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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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