Car-sharing app Lyft may find hurdles in Minneapolis

Lyft, a car-sharing app that has spurred regulatory fights and taxi protests in cities across the country, could encounter similar obstacles in Minneapolis.
The San Francisco-based company connects willing drivers and would-be passengers via a free smartphone app. It isn’t operating in Minneapolis just yet but is already soliciting drivers on Facebook and other social media sites.
“Join the Lyft community and earn up to $20/hr while meeting great people around Minneapolis,” reads an online ad from the company, beside a photo of a car bearing one of Lyft’s signature pink mustaches.

Minneapolis’ head of business licensing, Grant Wilson, believes Lyft drivers would need licenses in order to operate in the city. He said Minneapolis has not been contacted by the company, however, nor has the city discovered Lyft operating.

Obtaining taxi licenses would run against Lyft’s business model, which relies on easily signing up people with a vehicle and time to drive. Lyft’s website says drivers must be 23 years old and pass through a phone screening, in-person meeting and background checks.

Lyft, which is now live in six U.S. cities, said it has not determined a launch date for Minneapolis.
“As we always do, we will review all city and state regulations prior to launch,” Lyft spokeswoman Erin Simpson said in a statement. She noted that California regulators have recently proposed rules to accommodate services such as Lyft, as long as they adhere to certain safety and liability requirements.
Minneapolis City Council Member Gary Schiff, the council’s authority on taxicab ordinances, said licensing taxis is important to ensure that drivers are not fugitives, that vehicles are inspected, and that consumers can lodge complaints.
That means licensing drivers and the company itself, regularly inspecting the vehicles and installing meters.
“It’s a little dumbfounding to me that this start-up company has this business model that leads them to get into fights with cities all across the country,” Schiff said.

“I don’t know what they’re thinking. It’s a very basic accepted piece of regulation for every city in the country to regulate driving services.”
St. Paul may be a different story. Licensing Inspector Tom Ferrara said licensing requirements depend on whether there is a meter in the vehicle, per city ordinance.
“If there was no taxi meter, we would not require them to have a license,” Ferrara said. St. Paul has not, however, been contacted by Lyft.
Rather than a meter, Lyft’s model relies on a suggested “donation” that appears on the passenger’s smartphone at the conclusion of the ride. The donation is “voluntary” and can be adjusted, according to the company’s website.

A similar app
Lyft isn’t the only smartphone car-sharing app expanding into the Twin Cities. Another popular national service, Uber, began operations in Minneapolis last year.
A key difference? Uber’s Minneapolis general manager, James Ondrey, said the app only partners with limousines and sport-utility vehicles that are licensed through the state Department of Transportation.
Still more apps have made it easier to hail a traditional taxi around town. TaxiMagic and a new app, iHail, use GPS to connect people with licensed taxis in the area without calling a dispatcher.

Source: StarTribune, by Eric Roper, August 5, 2013