Controversy over Uber 'surge' rates in Charleston resurfaces

Desperate for a way home from a New Year's Eve party, Paul Field decided to take his friends' advice and download the Uber app. He had heard it was a quick and easy-to-use service, but he didn't realize an eight-mile ride would end up costing him more than $100.

Field was among the 20,000 people across the country who downloaded the app Dec. 31, according to Uber. He was also one of many who accidentally agreed to a "surge" fare, a higher rate that Uber charges during periods of high demand.

Although users are notified of the price hike when they schedule a ride, Field said he didn't realize what the notification meant because he was so new to the app. The notification tells the user how the fare will be calculated, and by how much the base fare will be multiplied.

"It told me I will be charged eight times the fare amount. I didn't understand at the time what I was clicking," Field said. "It was very confusing."

He was traveling with four other friends from the peninsula to his home on Shelmore Boulevard in Mount Pleasant.

"When I looked at the receipt it said they charged me $190 for an eight-mile ride," he said. In order to schedule rides on the app, users must have a credit card or PayPal account linked to the app so fares can be automatically drafted from their accounts.

Field disputed the charge with Uber and was given a 25 percent refund because it was his first time using the service.

"I feel like the idea for the app is fantastic, but they didn't give you much information about the 'surge' pricing,' " he said.

The company says the higher rates are used to encourage more of its freelance drivers to get on the road when demand for rides escalates.

"On the busiest times of the year, like New Year's Eve, dynamic pricing enables Uber to be a reliable choice for riders to get around cities safely," said Kaitlin Durkosh, spokeswoman for Uber. "Users are repeatedly notified of dynamic pricing ahead of confirming a trip request, and always have the option to wait until fares are lower."

Also, Uber notified users and media early this week of the times on New Year's Eve when fares would be the highest.

Charleston's Traffic and Transportation Committee is drafting an ordinance that would regulate Uber as a "transportation network company," which would be treated differently from taxis or limousines.

City Councilman Bill Moody, chairman of the committee, said he's unsure how the group will handle Uber's "surge" pricing practice, but that he "doesn't like it."

"We don't let taxis do that and we don't let limos do that. ... It's not a 'surge,' it's gouging," he said. "I don't care if they did agree to it. These people needed to get home, and they were taken advantage of."

Rasier LLC, an Uber subsidiary that operates the app, has applied for a license to operate in South Carolina. In its application, the company explained its rates system and that the maximum price increase can go as high as 15 times the regular rate of $0.20 per minute plus $1.75 per mile.

"In all situations, the prospective customer will be advised of the applicable rates being charged and will have the option of receiving an estimated fare before booking the ride," the document said.

Reach Abigail Darlington at 937-5906 and follow her on Twitter @A_Big_Gail