Last Friday morning, the Minneapolis City Council approved an ordinance legalizing and regulating transportation network companies (TNCs) like Uber and Lyft. The new regulatory framework includes licensing fees, insurance standards, and driver qualification requirements. The ordinance also includes measures to significantly lessen the regulatory burden of taxi companies, ensuring a fairer regulatory playing field for decidedly similar businesses.
Transportation network companies are now authorized players in Minneapolis’ transportation landscape. I am pleased with the ordinance. It unobtrusively protects the public interest. Ward 5 Councilmember Blong Yang, however, expressed several reservations meriting attention. For one, taxi companies still bear a weightier regulatory burden. TNC’s can adjust fares, employing demand pricing while taxis cannot.
Yang was also concerned that low-income and high-crime neighborhood residents risked underservice or exclusion if the TNC were to become the dominant model. The use of TNCs requires access to banking services and a smartphone – a barrier for many. Drivers might discriminate against riders, too. The notion of drafting public policy to accommodate illegally operating multibillion-dollar companies that may disadvantage some of Minneapolis’ most vulnerable is unsettling.
Ward 3 Councilmember Jacob Frey, one of the authors of the ordinance, addressed Yang’s concerns. Responding to Yang’s fear that the wheelchair surcharge are insufficient financial subsidy incentives for taxi companies and TNCs to provide service to disabled passengers, Frey noted that the city will audit the TNCs and taxi companies to ensure that public interest goals are being met.
I am not a neutral observant of the TNC regulation debate. I reguarly use Uber. And, I am happy that TNCs are now authorized participants in Minneapolis’ rapidly evolving multimodal transportation mix. However, we – the government and innovators – must rigorously ensure that the system is fair. That will be an ongoing effort.
- No break for taxi drivers: New deal helps companies, not cabbies (Mary Turck, News Day, 2014)
- Minneapolis taxis versus pink mustache: Battle moves to city council (Mary Turck, TC Daily Planet, 2014)