• Greg Hinz On Politics
  • Greg Hinz On Politics

    Another 'new economy' battle hits Springfield—this time over cars

    Thinkstock
    Car apps like Turo let travelers lease cars directly from individual car owners.

    79彩票注册网址If you liked Airbnb versus the hotel industry or Uber-Lyft against taxi operators, a similar fight over what rules to apply to car-sharing companies is brewing in Springfield. And it could turn into a beaut, with the future of the transportation business and millions of dollars a year in tax income at stake.

    Pending before the House Executive Committee is that would require emerging car-sharing competitors to follow the same licensing and regulatory rules that they do. The new competitors, such as do not own and rent out their own vehicles but instead use an app-based system in which travelers lease cars directly from individual car owners, with Turo playing intermediary.

    79彩票注册网址Turo spokesmen argue that the bill, which is scheduled for a committee hearing tomorrow, would "effectively slow or stop Turo's ability to offer a marketplace to 200,000 Illinois citizens and similar peer-to-peer car-sharing companies."

    The company also argues that the 6,600 renters it has in the state, or "hosts" in company jargon, already are at a competitive disadvantage, because unlike Enterprise, they are required to pay the state's 7.25 percent sales tax on car purchases.

    79彩票注册网址But advocates of the bill say it's the traditional firms that are losing out because lower-priced upstarts aren't held to the same disclosure, insurance or consumer protection standards.

    The bill in question "would put a stop to the disparate treatment under Illinois law of what is in essence the same rental transaction by two competitors for the same rental car customer," the American Car Rental Association, a trade group, said in a letter to Senate leaders.

    To make their case, both sides have enlisted some heavy lobbying talent, with former Chicago intergovernmental relations chief Victor Reyes working for Enterprise and well-known lobbyists John Kelly and Roger Bickel on Turo's team.

    Adding a little spice to the fray are some big political contributions in recent years from Enterprise to the chief Senate sponsor of the bill, Tony Munoz, D-Chicago. His campaign fund from a division of the firm and since then has garnered at least $10,000 in smaller donations.

    Particularly interested in how this fray turns out are local governments that tax car rentals at O'Hare, including the city of Chicago and the Metropolitan Pier & Exposition Authority, the agency that runs McCormick Place.

    79彩票注册网址The latter, for instance, lost about $3 million a year when the city authorized Lyft and Uber to begin picking up passengers at O'Hare but did not require them to pay the same taxes as Yellow, Checker and other cab companies, McPier CEO Lori Healey said. The agency is trying to get the money via a city administrative appeal, but there's no question taxes have fallen behind technology, she added. "We believe they all should be paying the same tax."

    79彩票注册网址If the bill clears committee, it will have to pass the full House and then go back to the Senate. It could happen, but time is running short on the legislative calendar, with the General Assembly scheduled to adjourn its spring session on May 30.

    This story has been corrected to show that Turo hosts are paying the 7.25 percent sales tax, while Enterprise is not.

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    Earlier:

    Which neighborhoods use Uber and Lyft most

    What's making traffic worse in Chicago? Signs point to Uber, Lyft.

    Opinion: Zipcar isn't a sin. Why tax it like one?

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