Uber, Lyft Bail on Minneapolis After Dem-Run City Council Overrides Mayor’s Veto on Minimum Wage Ordinance

2024-03-23 15:00:30

Democrats in Minnesota are scrambling to undo the damage done after the Minneapolis City Council passed a minimum wage ordinance related to “transportation network companies” that caused rideshare giants Uber and Lyft to follow through on threats to bail on the state’s largest city.

The city’s Democrat mayor, Jacob Frey, had opposed the measure and vetoed it when it came across his desk. But the City Council, which has zero Republicans, 12 Democrats, and one Democratic Socialist of America member, easily overrode the veto despite Frey’s objections and Uber’s and Lyft’s public statements that they would cease operations should the ordinance become law:

Both rideshare companies released statements condemning the City Council’s vote. Uber says it will leave the entire metro area, including the airport, on May 1 when the ordinance becomes law.

“We are disappointed the Council chose to ignore the data and kick Uber out of the Twin Cities, putting 10,000 people out of work and leaving many stranded,” Uber’s statement said. “But we know that by working together with all stakeholders — drivers, riders and state leaders — we can achieve comprehensive statewide legislation that guarantees drivers a fair minimum wage, protects their independence and keeps rideshare affordable.”

Lyft says it’ll shut down operations in Minneapolis on May 1, but it’s unclear if services will be affected in the wider metro area, like Uber’s plan.

“This ordinance is deeply flawed, and the rates it sets are far higher than what the state’s study suggested,” Lyft’s statement said. “We support a minimum earning standard for drivers, but it should be done in an honest way that keeps the service affordable for riders. This ordinance makes our operations unsustainable, and as a result, we are shutting down operations in Minneapolis when the law takes effect on May 1. We will continue to advocate for a statewide solution in Minnesota that balances the needs of riders and drivers and hope to return to Minneapolis as soon as possible.”

As a result, some of the same members of the City Council who pushed for the ordinance are now calling for it to be reconsidered—and are also looking to the state to help rescue them:

On Thursday, during a Minneapolis council meeting, Council Member Andrea Jenkins gave notice that she intended to move for reconsideration of the ordinance. Jenkins voted for the bill twice, first during initial approval, then again to override the veto.

On Thursday, Jenkins said her motion would give council members the chance to make changes to bring about a “broader resolution” to this issue. She also said two council members, Aurin Chowdhury and Emily Koski, have been working with state lawmakers on a resolution.

When Jenkins was asked by the local media why the council proceeded forward with the original ordinance prior to the release of a state transportation department report on ridesharing income instead of waiting to review it so the ordinance could be tweaked, she had no good answers:

Despite the controversy, the council is now considering both the state data report on ride-hailing driver wages and their own data. FOX 9 asked why council members didn’t wait on the data release before passing the ordinance in the first place.

“We had been waiting on this data for quite some time,” Jenkins explained. “I have been asking folks from the state personally and there was no clear answer as to what was going on.”

[Council Vice President Aisha] Chugtai said she had no regrets about moving forward with the ordinance before getting the state data. “To be clear, none of us has any control over the actions of a multi-billion dollar corporation. They will do what they’re going to do. We will do what’s best for our city.”

Chugtai, I should note, is a former campaign manager for Rep. Ilhan Omar (D-MN).

Adding to the pressures being put on the City Council to reconsider/revise the ordinance is how Uber and Lyft leaving Minneapolis would impact the elderly and disabled:

In 2023, Minnesota’s Democrat Gov. Tim Walz vetoed similar legislation after Uber said at the time that they would have no choice but to pull out of Minnesota:

In a letter Thursday announcing the veto, Waltz said that “rideshare drivers deserve fair wages and safe working conditions,” but said that “this is not the right bill to achieve these goals.”

He also argued that the bill would have made Minnesota “one of the most expensive states in the country for rideshare.”

A similar ordinance from the Seattle City Council that went into effect at the first of the year also backfired, with Door Dash and Uber Eats drivers complaining their workload had declined as a result of residents deleting the apps off their phones over elevated fees that made meal deliveries way too expensive.

As to what happens in Minneapolis over the next month? We’ll keep you posted.

— Stacey Matthews has also written under the pseudonym “Sister Toldjah” and can be reached via Twitter. —


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Uber, Lyft Bail on Minneapolis After Dem-Run City Council Overrides Mayor’s Veto on Minimum Wage Ordinance


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