A big win for consumers - Seattle's Mayor deregulates rideshare services

June 19, 2014

Seattle Mayor Ed Murray’s plan to deregulate rideshare services and reduce the taxi monopoly is a big win for the traveling public.

Over the past two months, Seattle Mayor Ed Murray has hosted negotiations between taxi owners, drivers, and representatives from rideshare companies like Uber and Lyft, to expand ridesharing and taxi services for people in Seattle. The Mayor announced a major agreement to expand the public’s access to competitive transportation choices.

The Mayor announced, “We have deregulated a highly regulated monopoly.”

For nearly a century, taxicab companies in Seattle have had to operate within a monopoly created by government officials. Without competition, taxi operations failed to meet increased customer demand for new services and options. For-hire car companies are also heavily regulated. For instance, for-hire drivers cannot pick up passengers on the street.

Earlier this year, the Seattle City Council imposed stiff restrictions on rideshare services. The Council voted to place artificial caps on the number of rideshare drivers operating in the city, severely limiting consumer choices and reducing competition.

Rideshare boosters, however, gathered enough signatures to place a repeal measure on the November ballot, believing voters would overturn the hefty burdens imposed by the Council. The Mayor, in order to avoid an election loss, tried something different: he sought finding common ground. The taxi, for-hire and rideshare compromise includes the following:

  • Eliminates the Council-imposed caps on ridesharing;
  • Allows for-hire companies to pick up street passengers;
  • Increases the number of taxi licenses over the next four  years;
  • Transitions taxi and for-hire licenses to medallions;
  • Creates a $.10 per ride surcharge to offset higher trip costs for riders who require accessibility services;
  • Licensing and insurance requirements for rideshare drivers.

Mayor Murray’s announcement is a big step in the right direction for consumers, but it faces challenges. His plan requires approval by the City Council, the same group that sought to strangle rideshare service in the first place. Rideshare companies could still follow through on their plan to put a repeal measure on the ballot in November. So far this looks unlikely, because the Mayor’s plan includes reasonable requirements to ensure the public safety, while providing more choices, lower prices, and better services to the traveling public – a clear example of how deregulation can serve the public interest.