Minnesota lawmakers announce rideshare deal, Uber and Lyft say they’ll leave if it’s passed
After months of debate and concerns over a rideshare pay ordinance in Minneapolis, leaders on the city council and state lawmakers have announced a compromise for statewide legislation. However, the rideshare companies apparently weren’t consulted and are still not on board.
Uber and Lyft have already said they’ll stop doing business in Minnesota if the newly announced measure is passed. Both companies currently offer service in all 50 states and Washington, D.C., meaning Minnesota would be the lone state without them if they leave.
According to a joint news release on Monday, the statewide measure would set the minimum wage for rideshare drivers at $1.27 per mile and 49 cents per minute. The measure approved by the Minneapolis City Council — which the body later delayed until July — set those rates at $1.40 per mile and 51 cents per minute. The state analysis recommended rates of 89 cents per mile and 49 cents per minute.
“We are happy to come to a compromise agreement with the Minneapolis City Council on a minimum compensation standard that aligns with other major metropolitan areas,” House Majority Leader Jamie Long (DFL-Minneapolis) said. “This compromise represents significant movement from the Minneapolis City Council as we all work towards ensuring drivers in our state are fairly paid.”
Senate Majority Leader Erin Murphy (DFL-St. Paul) called the deal “the result of hard work from the authors and stakeholders,” and several Minneapolis City Council members also applauded the agreement.
Yet, two key stakeholders were missing from those talks: Uber and Lyft, the major rideshare companies that have threatened for months to reduce service or leave the Twin Cities altogether if Minneapolis’ measure takes effect.
A spokesperson for Lyft told 5 EYEWITNESS NEWS that if the new statewide measure passes, “we would be forced to shut down throughout the state.”
“Lyft continues to support a minimum earnings standard for drivers. However, as was the case with the extremely-flawed Minneapolis ordinance, the proposed rates in the state bill would be incredibly damaging for both riders and drivers,” Lyft said in a statement Monday afternoon. “Rides would become unaffordable for most across the state, not just in Minneapolis, and drivers would earn even less.”
“It’s disappointing some in the legislature are allowing the Minneapolis City Council to drive a decision that impacts millions of people who don’t live in the City,” Uber added. “We’ve made a serious offers and hope we can still work with the Governor and legislature on a statewide solution that allows rideshare to remain in the state.”
An Uber spokesperson also noted that the company sent a proposal to lawmakers and Gov. Tim Walz last week that expressed support of rates up to 68 cents per mile and 42 cents per minute, well below lawmakers’ proposal.
As the Minneapolis City Council pushed forward with its citywide measure earlier this year, other much smaller rideshare companies came forward and expressed interest in trying to fill the void if Uber and Lyft left the city. Covering the entire state would obviously be a much taller task, and many state lawmakers and the governor didn’t like the idea of the companies leaving just Minneapolis.
“We certainly want to see folks paid a fair wage for their work,” Walz said in March. “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.”
Some Minnesota Republicans also suggested a bill that would’ve prevented cities from enacting local rideshare ordinances earlier this year. But this measure initially appeared to have at least some bipartisan support.
“These wages will provide both the drivers and rideshare companies with the stability they need to continue to operate,” Sen. Jim Abeler (R-Anoka), a co-author of the rideshare legislation, said in the joint release on Monday.
However, Abeler told 5 EYEWITNESS NEWS shortly after lawmakers sent their joint release that he didn’t know Uber and Lyft weren’t included in the talks on the statewide legislation.
“I understood there was agreement. Not surprisingly, given the complexities of this matter, resolution is difficult despite the honest efforts by all parties,” Abeler said.
“I trust those in the room will keep negotiating in good faith to keep ride share companies operating for those who need them,” he added. “I’m disappointed that this announced deal didn’t include the agreement of the companies that provide this vital service. I hope everyone can stay at the table to find an agreement that works.”
“Let’s be clear about what is happening here: Democrat legislators struck a deal with Democrat City Councilmembers that will still drive Uber and Lyft out of Minnesota. If this bill becomes law, Democrats will be fully responsible for the severe consequences for the disability community, tourism industry, and thousands of Minnesotans who rely on ridesharing services each day,” Rep. Pat Garofalo (R-Farmington) said. “We desperately need Gov. Walz and reasonable members of the DFL to wake up and get to work on a real compromise with all stakeholders at the table that will keep Uber and Lyft operating.”
“This is a positive step in the right direction that indicates all parties are continuing to work together,” a Walz spokesperson told 5 EYEWITNESS NEWS. “The Governor’s goal remains to be finding a solution that ensures workers are paid fairly while allowing these essential services to remain in Minnesota. He will continue discussing this issue with legislative leaders over the coming days.”
However, Minneapolis City Council member Robin Wonsley was part of the negotiations and said she kept Uber and Lyft up-to-date on the conversations in real-time.
With just two weeks left in the legislative session, lawmakers will have to make a decision quickly on whether or not to move forward with this measure, which is expected to get a hearing on Tuesday. If not approved before the session ends, it’s possible a special session could be called later in the year, although that would only be likely if a deal involving all parties is reached.