Gov. Tim Walz urged lawmakers to address rideshare driver pay in the state as Uber and Lyft announced they will stop providing service in Minneapolis due to a new city ordinance.

“We certainly want to see folks paid a fair wage for their work,” Walz said on Monday. “We also want to make sure that wage structure allows for the business to go forward. I’m deeply concerned should the rideshare companies leave.”

The issue came to a head after the Minneapolis City Council passed a new pay rate — meant to be an equivalent to the city’s minimum wage — for rideshare drivers who pick up, drop off or pass through the city. A 10-vote council majority overrode Mayor Jacob Frey’s veto.

While Lyft plans to end service only for trips that start or end in Minneapolis, Uber plans to cut options for the entire metro area, including Minneapolis-St. Paul International Airport. That’s causing concerns for many people, especially Minnesotans with disabilities who rely on those services.

The companies say the higher pay rate would price them out of the market, with customers not willing to pay for higher-priced rides.

Minneapolis City Council President Elliott Payne said last week the new rate is one a driver can raise a family on.

Some Minneapolis City Council members have stepped out to say they’ve been contacted by other rideshare companies that plan to move into the marketplace.

“I view this as a utility that is needed. To lose this, I don’t think it’s a plan to think somebody might step in. That’s not really a plan, that’s hopefulness,” Walz said. “We have an opportunity. We’ve got to get busy on this.”

There are bills at the Capitol that address statewide rideshare driver pay but at a slightly lower rate than what the Minneapolis City Council set at $1.40 per mile and 51 cents per minute while in city limits.

Senate File 4780 calls for $1.39 per mile and 49 cents per minute for rideshare drivers when taking a passenger on a trip.

A state report recently calculated what rideshare drivers would need to be paid to earn the Minneapolis city minimum wage of $15.57 per hour. It found drivers would need to be compensated at a rate of $0.89 per mile and 49 cents per minute.

“We are committed to working through this process with the stakeholders,” Lyft representative John Reich said during a recent Senate hearing on SF 4780.

House Majority Leader Jamie Long, who co-authored the House version of the DFL rideshare bill, shared the following statement with 5 EYEWITNESS NEWS:

“The House is committed to working with the Governor to provide fair compensation and appropriate protections for rideshare drivers,” Long wrote. “We have already had hearings on Rep. [Hodan] Hassan’s bill to do just that, and we’re in direct discussions to find a path forward to allow Uber and Lyft to operate in Minnesota while making sure drivers are treated fairly.”

On Monday, House Assistant Minority Leader Rep. Elliot Engen, R-White Bear Township, filed a bill to try and preempt the Minneapolis City Council’s action.

“There’s a difference from letting those municipalities and local governments to determine what is best for them, but this is going to have a larger implication than just Minneapolis,” Engen said. “This is going to not only impact the entire metro area but Minnesota at large. We need to get out in front of it.”

Engen’s bill, House File 5006, would stop any community from adopting or enforcing an ordinance that regulates a transportation network company.

“There are so many people that it’s going to impact that we want to protect these rideshare services,” Engen said.

Walz said he wants lawmakers to review the recent report from the Minnesota Department of Labor and Industry that studied 18 million rideshare rides in Minnesota.

5 EYEWITNESS NEWS has reached out to the Minneapolis City Council for comment on the legislation and hasn’t yet heard back.