Is Uber’s Paratransit Service Anything But a PR Move?

Uber wants to take over San Francisco’s system of transport for disabled and elderly residents. Are they serious, or just trying to look better to the public?

01.13.15 10:45 AM ET

Point to point transportation for anyone with a disability can be a challenge, and at the moment many rely on what are known as paratransit networks—accessible public transportation services. But that may change in the near future, thanks to another Silicon Valley disruption.

Uber, the popular app that helps users hail taxis and private cars, has been in talks with the San Francisco government to take over the city’s paratransit network, according to documents obtained by the San Francisco Examiner last week. Although the talks ultimately didn’t result in Uber doing business with San Francisco—the company was interested in taking over the city’s entire paratransit network—Uber’s foray into the public service does raise the issue of transportation network companies (TNCs) expanding into other niches.

And Uber isn’t the only such company interested in the paratransit market. “There’s a frenzy of innovation going on right now,” said Katherine Freund, President of ITN America, a nonprofit that specializes in transporting the elderly. “There’s going to be lots and lots of innovation. Transportation is changing at warp speed and networks are the future.”

Emily Castor, Director of Community Relations for Lyft, one of Uber’s competitors, said that the company is looking for ways to expand access for disabled riders—including paratransit. “[We’re] exploring partnerships to make fleets of paratransit or other accessible vehicles available for new and existing passengers on-demand,” she wrote in an emailed statement.

But some officials believe that the private sector involvement in paratransit, or at least Uber’s interest, is an idea rife with problems. “How long does it take to say, 'That is a bone-head, ill-considered idea that we have zero incentive to support?’” Chris Hayashi, the former taxi director at the city’s transportation authority, wrote.

“Technology is rapidly transforming the transportation industry and we are excited about how the Uber app has already increased mobility options for users with disabilities,” an Uber representative said in an emailed statement. “We will continue to look for opportunities to meet the high demand for rides that we see in cities throughout the world.”

Hayashi doesn’t buy it. “[Uber] needs to make themselves look good for their September report to the [California Public Utilities Commission, which regulates taxis], and they are holding their hand out asking us to let them use the infrastructure that we built in order to set themselves apart from their competitors—while they enthusiastically and deliberately tear it down with the other hand.”

ITN’s Freund said that there are public safety issues, and that policy is a necessary step to allowing TNCs into the paratransit business. “That’s going to limit some of the business models, change them,” Freund said. “There’s going to be a lot of frothy water for a while, but using IT to access unused private transportation capacity is good for the environment and economy.”

In spite of Hayashi’s reluctance to entertain Uber’s overture as anything more than a stunt to make them look good in front of government regulators, there are a growing transportation officials across the country are interested in the possibility of using TNCs to augment existing services, according to Susan Shaheen, a transportation expert at UC Berkeley.

“Policy makers and decision makers are looking at this tool, and asking the question: Could it be used to advance social and environmental good? It might provide more options for filling gaps in transportation systems, such as for first-mile-last-mile and during disasters,” she said.

Shaheen pointed out that it isn’t just government or major TNC players like Uber and Lyft eyeing the new market. Several startups, with more likely on the way, she said, have cropped up to service the elderly (Lift Hero) and children (Shuddle), for example.

Typically Shaheen said, such services were focused on a single niche or market segment, and typically those that are underserved or not served presently. “It’s not really surprising, in the light of the things about taxi services that Uber has shown us,” she said. “There’s a demand for transportation, and at the moment the ecosystem is very dynamic, and disrupted. It’s in play. ”

As a result, startups and existing business in the on-demand transportation sector are blending approaches and business models, as well as crafting specific approaches for regional and specific markets, such as the elderly.

Paratransit systems are, for the most part, federally funded through the Transportation Department, which doles out funding to their state counterparts. Then federal dollars are allocated to municipalities across each state, resulting in a motley patchwork of paratransit operations, providing different levels of service from municipality to municipality.

Since the programs to move around the disabled are usually run at the municipal level, some are worse than others. In Dallas, for example, complaints about the paratransit system totaled more than 2,500 pages for the first seven months of 2014—standing a foot tall, according to the Dallas Morning News. There have been problems in other regions as well: Orange County had difficulties with providers in 2007, as did Staten Island more recently.

San Francisco’s paratransit program has a 93 percent satisfaction rate, according to city officials.

Shrinking revenue from government operations such as casinos, lotteries, and taxes, can also result in cuts to paratransit services, leaving the elderly and disabled stranded, or reliant on friends and family for rides.

With point-to-point transportation’s landscape rapidly changing, Uber’s negotiations with San Francisco are likely among the first of many partnerships. And if the demand for taxi service exposed by TNCs is any indication of what America’s aging population needs, paratransit-like services may well be another promising market for the Ubers of the world as the baby boomers slowly retire.