The Salt Lake City Council took action Tuesday that may soon end a Wild West situation for peer-to-peer car-sharing company Turo at Salt Lake City International Airport.
It passed an ordinance to allow — after a 90-day warning period ends — handing out hefty $500 tickets to people who use Turo and similar companies to rent their personal cars there, unless the company starts paying airport fees.
Turo has escaped those fees and many taxes by claiming it really isn’t a car rental company, that it just connects those who want to rent their cars with customers. Traditional car rental companies howled that allows the upstart firm to lower its prices unfairly by up to 30 percent.
On Tuesday, the council also stepped back from initial plans to pass an additional ordinance to impose a $6 per reservation fee on car- sharing companies to conduct business at the airport. Traditional car rental companies pay more, 10 percent of the rental price, but they also usually use more airport facilities.
City Council Chairman Charlie Luke said the council thought it had an agreement on that $6 fee, but backed away at the request of legislators, rental car companies and Turo to allow more negotiation about what fees and taxes for all parties should be.
“As these discussions move forward, we hope that peer-to-peer car sharing companies will notify and educate their app users that operating at the airport is currently not authorized, but all parties are working to legalize the service equitably,” he said.
Meanwhile, the Utah Legislature also is advancing legislation that could start imposing some other tourism and rental sales taxes that Turo and similar companies also have evaded, but which traditional car rental companies have paid.
Steve Webb, senior communications director for Turo, said that rental car companies never had to pay sales tax when they bought their fleets — unlike Turo’s private car owners who did — so rental car companies have a big financial advantage of their own, too, that also should be addressed to ensure equity.
Previous city ordinances banned anyone from conducting business at the airport without a written agreement. Violation of that was a stiff Class B misdemeanor — and the city had charged some Turo app users under that law.
The new ordinance now makes violations a civil offense, but one with up to a $500 fine. It takes effect in 90 days.
“The hope is that during those 90 days that Turo, other car-sharing companies and the rental car industry can all work together with Salt Lake City to establish a legal path forward,” Luke said.
“We don’t want to disadvantage anybody who plays by the rules. But we understand the market is changing, that disruptive technology is just that: it’s disruptive. That means it puts pressure on us to figure out a way forward,” he said.
“We had to do something similar a few years ago with [ride-sharing companies] Lyft and Uber,” Luke said, amid complaints from the taxi industry.
Owners who use Turo to rent their cars do not store them at the airport. The owners and renters make arrangements on where to meet, and the owner often picks the customer up at the airport to exchange keys and information.
This week Turo advertised online that it had 81 vehicles available at Salt Lake City International Airport. Luxury vehicles available included a Bentley Continental Flying Spur for $335 a day, and a Mercedes-Benz E-Class for $315. The least expensive were a Nissan Sentra and Versa for $26 a day.
Michelle Peacock, Turo’s vice president for governmental affairs, said recently in an interview with The Salt Lake Tribune that traditional car rental companies are trying to stop Turo from operating at airports nationally, including in Salt Lake City.
“We know that the rental car industry is in close communication with airports across the country trying very hard to stop us from getting permits from any airport …. and we do not yet have a permit with any airport,” she said.