Gov. Tom Wolf, Pittsburgh Mayor Bill Peduto and Allegheny County Executive Rich Fitzgerald are criticizing the Pennsylvania Public Utility Commission for fining ride-sharing company Uber $11.4 million.
They said the hefty fine sends a message that the state is not a welcoming place for 21st Century businesses.
The fine, issued last month, was the largest the PUC has delivered. The commission voted 3-2 on the penalty, which was issued for operating without a state license. The PUC initially considered a fine of $50 million but lowered it when Uber modified internal practices, according to the commission.
The three Democrats didn’t say the ride-sharing company shouldn’t be penalized for operating in the state without permission, but rather the PUC should consider the broader impact such a large penalty could have on the economy.
“When ride sharing companies Uber and Lyft began operating in Pennsylvania in 2014, they were welcomed here with open arms,” the letter stated. “Like so many of our constituents, we understood at the time that our state’s future would depend on our willingness to embrace innovation and its potential to meaningfully improve people’s lives.”
The smartphone-based transportation service began operating in Pittsburgh in 2014 without authorization from the state. A similar company, Lyft, also started running without permission around the same time. Lyft settled with PUC last year for $250,000.
The joint motion from Commissioner John Coleman and Chairman Gladys Brown states that some argue the penalty should be reduced to a lower number than what was proposed in the motion.
“It must be recognized that Uber has deliberately engaged in the most unprecedented series of willful violations of commission orders and regulations in the history of this agency,” the motion states. “While we cannot disclose the number of proven violations, as this data is proprietary, this figure, in the many thousands, far exceeds any prior case involving the Commission. A record number of proven violations should be expected to result in a record setting fine.”
Uber has announced it will appeal the fine and officials with the company said they were shocked by the amount.
Jennifer Krusius, Pennsylvania regional general manager for Uber, said the PUC is not sending the message that the state welcomes innovation.
“(Or) inviting businesses to participate in sort of the new economy or that we think of fines in the context of what all businesses in Pennsylvania are fined for over history and when compared with competitors,” she said.
Krusius said it’s too early to determine the impact the fine would have on the company’s future in Pittsburgh. She said she’s pleased with the support of officials, but the fine is giving the company pause to determine whether or not the state is the right fit.
“We’d like PUC to consider the outcome and reconsider that or whether this is fair and in line with the mission of the PUC,” she said.
