Yellow Cab leader touts transparency, then fights release of reports

By Nolan Hicks
Austin American-Statesman
Originally published Aug. 31, 2016

When Yellow Cab Austin President Ed Kargbo went to the Capitol to address state lawmakers back in June, he hammered on one issue in particular: transparency.

There was no way to verify Uber’s and Lyft’s claims they serve minority communities and disabled people, or how much their drivers were making, Kargbo said, because the ride-hailing giants refuse to release any data.

“We report our data, all of our data, to a third party, the city,” Kargbo told the Texas House’s Business and Industry Committee, which held a hearing on ride-hailing rules in June. “Our information has been released to the public. We don’t make claims about (having) 10,000-plus (drivers), this, that or the other.”

He added: “Transparency is a critical part of this process.”

However, in the weeks after he made that statement, Yellow Cab sought to block the American-Statesman from obtaining those very reports from the city of Austin, even though those reports have routinely been made public in the past. The Statesman requested the monthly reports — which include total and per cab earnings, ridership numbers and customers’ average wait times — in an attempt to examine the impact of the May departure of Lyft and Uber from Austin.

Competitive concerns

His company argues the reports are exempt from release under the state’s Public Information Act because they contain proprietary information. Kargbo’s firm is the only one of Austin’s three cab companies to object to releasing the reports, city spokesman David Green said.

Texas Attorney General Ken Paxton’s office hasn’t yet ruled on the Statesman’s June 7 request, but his office did uphold a previous request to withhold the information from another requester, Green said.

For years, the cabs have been part of a highly regulated industry in Austin, with only three taxi companies allowed to operate. The city set the rates they charge and, until recently, capped their number of drivers.

But the events of the past year have made the market more competitive. Uber and Lyft signed up legions of drivers for hire, and, although the companies left Austin in May, eight other similar startups have arrived. That same month, city staffers recommended a partial deregulation of the taxi industry, and, in June, the City Council approved creating a fourth taxi franchise, a driver-owned cooperative.

It’s too soon to say how closely these new companies will guard the ridership data they provide to the city. An Aug. 22 memo by the city’s transportation director provided aggregate numbers for drivers and rides across all eight ride-hailing companies, and only percentages for company-specific data on fingerprinting.

However, the tech leaders who created the RideAustin app said they plan to lift some of the veil on how the young ride-hailing industry works, vowing to share much of their ride and driver information with University of Texas researchers.

The Boeing exemption

Government transparency advocates see Yellow Cab’s success in claiming the reports are proprietary as another blow to the state’s open records law, an essential tool for news organizations and others seeking to obtain documents that shed light on how government works.

The cab company’s argument grew out of a Texas Supreme Court ruling last summer involving the aerospace giant Boeing’s operations in San Antonio. The Boeing decision expanded the rights of companies to block the public release of information they have provided to government agencies.

Previously, companies had to prove that releasing the documents would result in the disclosure of trade secrets or proprietary information. Now, they can simply assert the documents would put them at a competitive disadvantage. The decision also made it easier for government entities to block the release of their own records on these grounds, too.

“It’s like the dam broke,” said Kelley Shannon, executive director of the Freedom of Information Foundation of Texas. “There’s so many cases of this happening across the state, it’s put a huge hole in the state’s Open Records Act.”

She said the attorney general has issued rulings in some 300 cases in which companies or government entities have claimed the so-called “Boeing exemption.” Many of those rulings have favored keeping those documents from the public.

In El Paso, the hospital system can now keep secret its contract with a consulting firm it hired to recruit its new chief executive. In McAllen, the city hired Latin pop star Enrique Iglesias for a holiday parade and was then able to block records requests that sought to see how much it cost. And in Houston, it means that Uber has blocked the city from releasing how many drivers it has permitted for the ride-hailing service.

“It’s taxpayer money being spent that’s being put off limits,” Shannon added. “The horror of this is that it leaves the public totally without information about their government.”