State lawmakers grapple with internet-fueled economic changes

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BOSTON >> When it comes to grappling with the internet-fueled changes roiling the Massachusetts economy, local political leaders are taking a glass half-full/glass half-empty outlook.

At the Statehouse, lawmakers have largely embraced major players in the online economy. They've passed ride-booking regulations, but agreed not to require drivers for Uber and Lyft to be fingerprinted, despite calls from Boston Police Commissioner William Evans, noting that Boston taxi drivers must submit fingerprints.

In another concession, lawmakers dropped a provision that would have barred the ride-booking firms from picking up passengers at Logan International Airport or the Boston Convention and Exhibition Center for the next five years — a proposal designed to provide a temporary boost to taxi companies. The law does require the companies to pay a 20-cent per ride fee, a portion of which would go toward helping cabbies hurt by competition.

Lawmakers also abandoned a proposal this year that would have applied the state's hotel and motel taxes to online lodging services such as Airbnb, as well as vacation rentals — even though Airbnb publicly backs the tax.

Republican Gov. Charlie Baker initially said he supported the proposal, then said he wasn't interested in raising taxes — but also said he wants to create a level playing field with hotels.

Baker also signed off on legislation that would let the biggest of online sellers — Amazon — avoid paying workers at a planned distribution center in Fall River overtime on Sundays, a move that has been roundly criticized by local retailers. The Fall River location is expected to employ up to 500 workers.

Smaller stores said classifying Amazon as a distributor instead as a retailer creates an unfair playing field, an argument central to the debates over regulations for ride-hailing companies and online lodging services.

For all their innovations, the digital wunderkinds have relied on an old school method to ensure their voices are heard on Beacon Hill: paid lobbyists.

During the first 18 months of the current legislative session — from January 2015 through June 2016 — Uber spent just under $500,000 lobbying Beacon Hill lawmakers.

During the same period, Lyft spent nearly $192,000. Airbnb spent about $114,000 while Amazon spent $108,000. That's according to lobbying records filed with the Massachusetts state secretary's office.

While Statehouse leaders are hoping to build up the state's reputation as an East Coast hub for the "innovation economy," other political leaders say they are concerned about the plight of workers caught up in the churn.

U.S. Sen. Elizabeth Warren has warned of the downside of the so-called "gig economy" that allows workers to piece together a living from online odd jobs, from driving cars to performing household errands.

The biggest problem in Warren's eyes is that those workers are often denied access to benefits many traditional workers have long taken for granted — from paid vacation and health coverage to retirement plans, workers compensation and the ability to unionize.

"To fully realize the potential of this new economy, laws must be adapted to make sure that the basic bargain for workers remains intact, and that workers have the chance to share in the growth they help produce," Warren said in a speech earlier this year.

The Democrat said others — including temporary workers, contract workers, part-time workers and those reclassified as "independent contractors" — are facing the same shifting economic sands.

She said the nation must guarantee that every worker, even those without an employer, pays into Social Security, is covered by catastrophic insurance, and has some paid leave. Employee benefits, including health care and retirement, should follow the worker no matter what job they're doing, she added.


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