Lyft supporters gather at a City Hall rally in February.
Lyft supporters gather at a City Hall rally in February.

In less than three weeks, Seattle may issue a cease-and-desist letter to transportation companies like Lyft, Uber and Sidecar.

Representatives from the San Francisco-based startups, taxi companies and City officials are currently in the midst of a negotiation process to establish a new regulatory framework that would allow Lyft, Uber and Sidecar to operate legally in Seattle.

The City Council originally approved an ordinance in March, but a coalition group that received more than $400,000 in donations from UberX and Lyft submitted enough signatures last month to suspend the ordinance regulating the transportation companies, which utilize smartphone apps and everyday drivers to shuttle people around town.

uberxLyft and UberX voiced displeasure with the original ordinance, specifically the law that allowed 150 “active drivers” for each company.

“Ride-sharing has become wildly popular in Seattle, but City Council doesn’t get it,” Lyft employee Emily Castor wrote in March. “Last week, they voted for barriers and caps that would crush ride-sharing just as it is beginning to blossom.”

Those from the taxi and for-hire industry, meanwhile, were happy that the City decided to add 200 new taxi licenses in the next two years — the first license increase in 23 years — but also expressed concern over the 150 cap.

“I don’t know how the city will enforce the cap,” Eastside For Hire General Manager Samatar Guled said in March. “What happens after the Mayor signs this — are the companies going to respect the law, or are they going to ignore it, just like they’ve done all this time?”

Now that the ordinance has been suspended, the Mayor has hired a mediator in hopes of reaching a compromise between all the stakeholders. Megan Coppersmith, the City’s public information advisor, told GeekWire that negotiations are ongoing and the group is meeting again Wednesday.

“All sides are still at the table and progress is being made,” Coppersmith said.

Seattle Mayor Ed Murray.
Seattle Mayor Ed Murray.

The Mayor himself is not involved in the negotiations, but is offering his support. Coppersmith added that the City also has a role “to ensure any proposals protect public interest and safety.”

A deadline has been set for June 2, and if no agreement is reached, Murray said last month that he’ll have no choice but to issue a cease-and-desist letter. If that happens, Seattle citizens would then vote on the original ordinance later this year.

Murray’s number one concern making sure that drivers and passengers using the new services are properly insured. The original ordinance required UberX, Lyft and Sidecar drivers to carry commercial insurance.

“The ability to make sure there is a level of insurance and level of certification of both the driver and the car — those are key things for me that have to be solved,” Murray told us in April.

If a compromise is indeed reached during the negotiation process, the City Council could repeal the ordinance it approved in March and then work together on a new set of regulations. If that’s the case, the referendum would not appear on a ballot.

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  • Guest

    If Uber and Lyft are illegal, wouldn’t the so-called “cease and desist” have already happened? This is just posturing intended to get a little $ for City Hall.

    TNCs are not only legal, but necessary. In a city without sufficient taxi medallion stock and whose electorate routinely votes to destroy its own public transit system, we need the private sector to step in and offer the services that our “regulated” services do not.

    For safety, replies to this comment will not be read.

    • Guest

      Love this! Apparently, this person alone knows the law, even though they clearly haven’t read any of it. To cap it off, for “safety,” whatever that means, they’re not even going to listen to anybody else. Good thing they’re not actually in charge.

      In other news … about time the city got some spine.

    • John Kane

      So let me see if I follow your “logic” here….

      You somehow know that the public of Seattle votes to destroy public transit that they actually need, yet you’re able to divine the “true” intentions of the Seattle public with regards to Lyft and Uber.

      You’re apparently also a municipal judge in Seattle and can also divine the true intent of the taxi regs in Seattle. You magically realize they don’t apply to Lyft and Uber.

      Is there anything you can’t do? How do you perform these miracles? Do you read the entails of slaughtered Seattle pigeons to obtain your “knowledge”?

    • ClaimsAdjuster

      Uber-troll: “For safety, replies to this comment will not be read.”

      It is much safer for you not to read the mockery that your inane arguments provoke. You risk a stroke if you read the replies.

    • Clarence789

      To avoid intellectual confusion, the previous post will not be read.

  • Guy

    No tunnel, no 520 bridge, the Mercer mess, no increase in taxi licenses in 23 years, the roads are in ruin, and meanwhile we spent $250 to appease the bicycle lobby? Yes, certainly when it comes to transportation, given the fabulous record of Seattle elected officials, it makes sense to now issue a cease and desist on the one bright spot in our entire transportation “system.”
    Thanks, but not one of these people will ever get my vote again. Ever.

    • John Kane

      So in other words, living in a city like Seattle with dozens of pressing issues, you choose to make the existence of Lyft and Uber– two hedge fund money driven enterprises that syphon money off of your community– the sole issue upon which you’ll vote or not vote for a candidate? You’ll ignore how the candidate addresses any of a variety of pressing issues facing your modern city because somehow Lyft and Uber trump any other possible city concerns Seattle might have?

      I think your extremist attitude speaks for itself and makes Lyft and Uber supporters appear as whacky as they actually are.

      • Guy

        Always amazing to see how some people attempt to distort another’s views. “Hedge fund money” is bad? Is that what you’re implying? I’m not sure how that’s the case. Isn’t that money coming from other Americans? The Uber drivers I’ve spoken to, both in Seattle and in other cities where I’ve used the service, love working for Uber and about 3/4 of them are ex-cabbies. That’s bad too? I just want to make sure I understand how someone who is doing something they like and getting paid for it is bad. Also, aren’t Uber drivers local? Doesn’t that mean that they are keeping and spending the money locally? That’s what our City Counsel understands, ask them, that’s why they just raised the minimum wage 60%, because “the money goes back in to the community.”
        In all of the other transportation issues I’ve mentioned the city has failed to execute. Is that not obvious to you? That’s bad management no matter how you slice it. Now they want to ban a car service that people really like and use, one that aligns with their precious environmental causes. That’s just foolish.

        • Guest

          The big profits from the California cab companies will always go back to California. That’s why the hedge fund companies are interested, and why they have values in the billions based on investments of hundreds of millions. It’s all about taking revenue that could be and should be local and taking it to California. What’s the line? “Follow the money.”

          In the long run, cabbies working for the California cab companies will fare no better (actually, worse) than if they were working for local cab companies. The fact that a minuscule subset of the population finds it convenient doesn’t negate reality.

          If you really think the transportation system is broken, do things to fix it. Don’t replace it with something worse that sends all the profits somewhere else. That’s just foolish.

          • Guy

            You mean something “worse” that consumers have overwhelmingly said they love? That kind of worse?

          • us0r

            As I understand – the drivers get xx% and uber takes a cut. Are they not using local drivers?

    • ClaimsAdjuster

      It makes sense to issue the C&D against Lyft and Uber because their operation is illegal and their insurance is sketchy. The other things you mentioned are irrelevant.

  • ClaimsAdjuster

    What cards do Uber and Lyft have to play in these negotiations? Are they going to trade getting commercial insurance and licensing for removing the caps? Since these are things that they will have to do anyway, they can’t play these cards.

    Maybe Lyft and Uber think that the referendum is their trump. But this is unlikely to get on the ballot since the city attorney could get a court ruling that the for hire laws are not subject to referendum. If the referendum were to get a vote, it would lose.

    Lyft and Uber have nothing to trade. This isn’t a negotiation but a meeting where the city makes an offer that Lyft and Uber can’t refuse.

  • elbowman

    Hopefully, Seattle City Council will grow a pair and stand up to the deep pockets and shut down their foolishness. Three weeks can’t come soon enough for me.

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