Waymo and Cruise Receive CPUC Authorizations to Collect Fares for Autonomous Vehicle Rides in San Francisco

On August 10, 2023, the California Public Utilities Commission (CPUC) voted 3-1 to approve Resolution TL-19144 and Resolution TL-19145 (the "Resolutions") authorizing Waymo LLC (Waymo) and Cruise LLC (Cruise), respectively, to collect fares for driverless AV rides in San Francisco, without time restrictions. Prior to the vote on the Resolutions, Waymo and Cruise were already authorized to provide commercial driverless AV rides in San Francisco, without time restrictions, except without collecting fares. Nonetheless, the City of San Francisco ("City") filed motions to stay the Waymo and Cruise Resolutions, claiming that "San Francisco will suffer serious harm if [the AV companies are] allowed expansion in the City with no limitations on geographic area, service hours and fleet size." The City will have to explain why fare collection by itself will cause an expansion in the services that Waymo and Cruise already offer. The City also announced it will seek rehearing of the Resolutions at the CPUC on similar grounds.

The CPUC will decide whether to grant or reject the motion for stay or rehearing, but it seems unlikely that the city will prevail.

The City apparently has the vote of Assigned Commissioner Shiroma as she did not support the Resolutions. Commissioner Douglas was absent from the voting meeting so could present a wildcard and a possible second vote. However, the other three Commissioners clearly stated that they supported the Resolutions while considering the public safety impacts. And the City cannot expect Commissioner Reynolds—who previously served as in-house counsel at Cruise—to recuse himself. While voting in favor of the Resolutions, he explained that he will no longer recuse himself from decisions involving AVs after doing so for one year following his appointment as CPUC Commissioner. Given these dynamics, it seems the City is unlikely to prevail on its motions to stay or future applications for rehearing at the CPUC.

CPUC Found Waymo and Cruise Met Minimum Passenger Service Requirements

The Resolutions evaluated the applications of Waymo and Cruise to collect fares under the requirements established in a 2020 CPUC Decision (Decision 20-11-046, as modified by Decision 21-05-017). Specifically, the CPUC concluded that each company demonstrated compliance with the Commission's general order governing Transportation Charter Party carriers (which includes basic safety and insurance requirements) and submitted a Passenger Safety Plan that adequately described policies and procedures to minimize risk for all passengers in driverless AVs.

Current CPUC Operating Authority for Waymo and Cruise

The Resolutions do not change existing parameters for Waymo or Cruise such as pickup and drop-off locations, for example, or provide rules for structuring fares:

• Waymo Operating Speed and Conditions: Waymo is authorized to operate at speeds up to 65 miles per hour (mph), including in rain, fog, and inclement weather, throughout San Francisco and a portion of San Mateo County.
• Cruise Operating Speed and Conditions: Cruise is authorized to operate at speeds up to 35 mph in the City of San Francisco, except in extreme weather conditions such as heavy fog, sleet, rain, or smoke.

• Pickup and drop-off locations: Pickup and drop-off more than 18 inches from the curb creates hazards for passengers and surrounding road users, blocks the flow of traffic, and creates accessibility challenges for persons who may need or want direct access to the curb.
• Fares: The CPUC's decisions allow the AV companies to fare-split for shared rides but do not put any restrictions on how fares can be structured.

Ongoing Considerations

A central theme in both stakeholder commentary and the Resolutions relates to safety. During the voting meeting, public commenters and Commissioners alike raised questions regarding: (1) interactions with first responders; (2) sudden and unplanned stops; and (3) compliance with traffic laws. The issues are similar to those being considered at the federal level as part of the National Roadway Safety Strategy. Public commenters also voiced concerns during the voting meeting related to ADA compliance and passenger service accessibility. Additionally, the growing number of operating AVs requires increasing levels of connectivity, and recent developments highlight the demand placed on the wireless spectrum for AV operations.

The Commissioners requested a report from staff in three months (mid-November), and the CPUC's Executive Director committed to do so (but noted potential limitations based on reporting requirements and what information can be publicly disclosed). The CPUC may also revisit the operating authority granted to the AV companies; specifically, the CPUC has the authority to initiate investigatory and enforcement actions against CPUC permittees, and to modify, suspend, or revoke authorizations it has granted.

Federal and State Safety Requirements

Since 2022, Waymo and Cruise have offered AV passenger service in California pursuant to authority from the CPUC's Phase I Autonomous Vehicles Passenger Service Driverless Deployment program, and within the Operational Design Domain (ODD) approved by the California Department of Motor Vehicles (DMV).

Notably, while the National Highway Traffic Safety Administration (NHTSA) sets the safety standards that apply to every motor vehicle operating on public roads in the United States, including AVs, the DMV establishes state regulations governing AV testing and deployment on California roads. That Waymo and Cruise have active AV Deployment permits and ODD approvals from the DMV means that the DMV determined both companies met the safety standards required to deploy AVs in California.

However, Cruise already faces a setback with the DMV requiring Cruise to halve its operations in San Francisco following two high-profile accidents that occurred last week. This action by the DMV shows it is clearly focused on ensuring that AV companies continue to meet its safety standards.

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DWT's mobility and transportation industry group will continue to follow the development of commercial passenger service, safety, and reporting requirements. We advise on these and other emerging legal issues impacting the future of transit to ensure our clients are prepared to advance new technologies while responding to regulatory frameworks.