A self-driving car operated by Uber Technologies Inc. (Uber) struck and killed a pedestrian in Tempe, Arizona last month.1 The incident has led policymakers to revisit concerns over autonomous vehicle (AV) regulations where currently, in the absence of any preemptive federal legislation, developers of AV technology face a complicated patchwork in which rules differ from state to state. The accident serves as a wake-up call that AVs, while they may inevitably be the future of transportation, are still far from perfect. Accidents, such as the one in Tempe, could not only further prolong the enactment of federal legislation, but could also lead to additional regulatory reactions among the states that will further complicate the regulatory landscape.2

The car involved in the accident was part of Uber’s AV testing program. The program made its home in Arizona due to the state’s favorable regulations and optimal weather conditions. At the time of the accident, the vehicle was operating in full “autonomous mode” but also had a safety driver behind the wheel to take control of the vehicle if the autonomous system failed.3 The National Highway Traffic Safety Administration (NHTSA) and the National Transportation Safety Board (NTSB) are investigating the matter.4 The results of these investigations, coupled with public reaction, could significantly impact policy decisions moving forward.

Patchwork of State Regulation

For the time being, regulation of AVs exists solely at the state level where states are left to strike a balance between safety and innovation. So far twenty-two states have enacted legislation regarding AVs, with an additional ten states issuing executive orders relating to the industry.5 States have taken different approaches to regulating the industry, which has led to a patchwork of rules that makes it difficult for AV companies to navigate through the legislative thicket.

States such as Arizona and Florida, eager to court the AV companies, have lax rules and limited oversight of the industry. In 2015, Arizona Governor Ducey signed an executive order directing all state agencies of Arizona to “undertake any necessary steps to support the testing and operation of self-driving vehicles on public roads within Arizona.”6 That executive order was followed by a March 2018 order that allowed AV testing on Arizona public roads without a safety driver present in the vehicle.7 Also, unlike many states, Arizona has no requirements for AV companies to submit reports detailing the results of their testing.8 Florida, which was one of the first states to pass AV legislation, took a similar hands-off approach. In 2016, Florida enacted a law that eliminated its previous requirements that a driver be present in the vehicle.9 Florida also eliminated the requirement that the operation of autonomous vehicles be done for “testing purposes.”10

Other states have taken a more safety-oriented approach to AVs. New York, for example, is set to allow AV testing in 2018 through a year-long pilot program. AV companies wishing to test their vehicles on New York roads must submit an application to the New York State Department of Motor Vehicles.11 The application must specify when and where the vehicles will be traveling, and the program also requires a licensed safety driver to be behind the wheel at all times.12

Familiar Road for U.S. Auto: From the States to the Federal Government

Due to the difficulties in complying with the current collage of rules, AV companies have urged the federal government to step in and take control. Federal legislation on the matter has been halted in Congress for now. When and if the federal government does step in, it will not be the first time auto-industry regulations went from the discretion of the state to that of the federal government.

From the inception of the automobile up until 1966, the industry was unregulated by the federal government.13 Auto manufacturers faced a nation-wide testing ground where individual states developed their own rules and regulations that they hoped would minimize the dangers of the automobile without completely smothering its innovation.14 In the early 1900’s, cities such as Detroit achieved notoriety due to the many injuries and fatalities incurred as policymakers debated how to handle the situation.15 By the 1960’s, over forty percent of unintentional deaths in the U.S. were associated with automobile accidents.16 In 1966, in response to the increasing number of injuries and fatalities linked to automobile accidents, Congress enacted the National Traffic and Motor Vehicle Safety Act (NTMVSA). The NTMVSA gave the federal government authority to create federal standards pertaining to motor vehicles and highways.17

Federal Legislation Currently Stuck in the Mud

Federal legislation that could provide oversight and clarity to the AV industry has currently stalled in the Senate. In September 2017, the U.S House of Representatives passed the Safely Ensuring Lives Future Deployment and Research In Vehicle Evolution (SELF DRIVE) Act.18 The SELF DRIVE Act provides a federal framework of regulations dealing with highly autonomous vehicles (HAV).19 The Act would preempt states from enacting any regulation regarding HAVs unless it was identical to those at the federal level. The Act also would give the Secretary of Transportation twenty-four months to come up with safety assessment certifications, which would identify “how safety is being addressed by each entity developing a highly automated vehicle or an automated driving system.” In the meantime, the SELF DRIVE Act would allow NHTSA to grant companies that manufacture HAVs exemptions permitting the companies to put more vehicles on the road.

Shortly after the SELF DRIVE Act was passed by voice vote in the House, the Senate Commerce Committee cleared a companion bill that took a similar approach to AV industry oversight.20 The bill, called the American Vision for Safer Transportation through Advancement of Revolutionary Technologies (AV START) Act, however, was blocked by a number of Senators over concerns pertaining to both safety and data security.21 The fatal Uber accident has only served to heighten those concerns.

After the fatal accident in Tempe, ten Democratic senators wrote a letter addressed to AV companies voicing concerns that the AV START Act fails to include any explicit prohibition on forced arbitration clauses in contracts between AV manufacturers and consumers.22 The letter confronts the reality that most AV companies are ride-sharing companies, or in the alternative, companies that would plan to use their AV technology to provide a ride-sharing service to the public.23 Currently, most ride-sharing apps function through a click through agreement that locks riders into forced arbitration clauses.24 The letter then presents a hypothetical regarding the Tempe accident: “had the victim been a passenger who had agreed to Uber’s terms of service, the victim’s family could have been denied recourse through the courts.”25 The letter goes on to ask the AV companies a series of questions regarding their current use and planned future use of forced arbitration clauses as they pertain to AV.26

Conclusion

As the investigation into the Tempe incident unfolds and as more accidents like it inevitably happen, the patchwork of state legislation will likely be re-stitched. This uncertainty has AV companies looking to the federal government for preemptive guidance and blanket regulations. However, until concerns over safety are cleared up in Congress, we will continue to see the states attempting to balance the potential economic benefits of innovation with the safety of their citizens.