Free Market

362,361 Reasons Why Salt Lake City Favors Taxis over Lyft and Uber

In an exclusive interview published last month, we broke the story regarding Salt Lake City’s heavy-handed fines being imposed on Lyft and Uber drivers operating without the city’s blessing. Citations amounting to $6,500 and more have been issued to drivers for daring to drive consenting passengers without the drivers having jumped through the city’s regulatory hoops.

Records obtained by Libertas Institute this week suggest more reasons why the city may be resistant to the innovative disruption that these ride-share companies bring. In the last fiscal year, Salt Lake City received $362,361.65 in fees from the three authorized taxi companies for the ~200 authorized vehicles operating throughout the city. This is in addition to license fees paid by the three companies to the city.

These fees come in exchange for preserving the protectionist city ordinances that grant a monopoly to taxi drivers as to who can pick up passengers “on demand.” Other services, such as limos and shuttles, are required to wait at least 30 minutes before driving a passenger after the request for transportation is made, and the fare must be a minimum of $30. Obviously, this requirement does not work for the business model established by Lyft and Uber, and therefore its operators are asserting their right to commerce and freedom of association by driving their passengers without a city-issued license.

Salt Lake City Chief of Staff David Everitt has told media outlets in recent weeks that city staff will be recommending changes to the law in a work session scheduled for September 16. While it is expected that some of the current burdens will be reduced for Lyft and Uber drivers, they will still be required—at an absolute minimum—to obtain a license and pay fees to the city.

If one thing is to be expected with new revenue streams from licenses being required of Lyft and Uber drivers, the city will have more than 362,361 reasons to continue its licensing regime and impose itself between drivers and their passengers as a condition of legally driving others for pay within city limits.