L.A. City Council weighs appeal of PUC ruling on ride-sharing firms

Taxi drivers protest ride-share apps outside of Los Angeles City Hall. The City Council is considering appealing a recent state decision to allow the companies to operate.
(Damian Dovarganes / Associated Press)

The Los Angeles City Council is weighing a challenge to the app-driven ride-sharing companies that have given residents new transportation options while drawing protests from the taxicab industry.

Councilman Paul Koretz is pushing for his colleagues to appeal a recent decision by the Public Utilities Commission to allow companies such as Lyft and Sidecar to operate under regulation at the statewide level. The council is set to meet Tuesday behind closed doors to discuss the possible appeal with city lawyers.

Passengers using ride-sharing services schedule their trips using the companies’ mobile phone apps and almost always pay a fare lower than those charged by taxis. The drivers are typically private citizens using their own cars.


A previous version of this story said incorrectly that the Los Angeles City Council is scheduled to discuss a possible appeal of a Public Utilities Commission decision to allow app-driven ride-sharing companies with its lawyers Friday. That meeting is set for Tuesday.

Koretz said that arrangement makes them “21st century bandit cabs” and argued that companies such as Lyft, whose drivers adorn their cars with pink mustaches, are a threat to public safety.

“They’re not regulated the way taxis are, so we don’t really know what their background checks are like, or whether we can count on them,” he said. “We don’t know what conditions their vehicles are in. I see crummy cars with mustaches all over town — just people in their own regular cars, driving.”

John Zimmer, Lyft’s co-founder, sharply disagreed with Koretz’s assessment, saying the PUC’s rules on drivers’ history and insurance requirements are more rigorous than those imposed on taxis in Los Angeles.

“There are in fact very strict safety standards put on us by the state,” Zimmer said.

The taxicab industry, long a political force at City Hall, contends the app-based ride services have an unfair business advantage because they operate outside the city’s inspection and regulatory process. Scores of taxi drivers staged a downtown demonstration last summer, demanding action from city leaders. But Mayor Eric Garcetti, who took office July 1, has remained a supporter of ride-sharing services, saying he would also work with taxi companies in the city to modernize their operations.

The PUC’s decision, issued last month, classified ride-sharing services as so-called transportation network companies that rely on prearranged rides. Those companies will have to obtain permits, require criminal background checks for drivers and establish a driver training program, the agency said in its decision.

“The commission is familiar with and confident in its ability to protect public safety in the face of rapid technological change,” the report states.


City Atty. Mike Feuer had no comment on Koretz’s proposal. Councilman Mike Bonin, who heads the council’s Transportation Committee, said he supports ride-sharing companies but wants to make sure low-income neighborhoods are not underserved.

Koretz has also accused the PUC of violating the state’s environmental laws, saying they failed to consider the increased congestion and air pollution that would come from allowing thousands of for-hire vehicles to travel on L.A.’s roads.

An appeal of the PUC’s decision must be filed by Wednesday, according to a spokeswoman for that agency. If a request for rehearing is rejected, opponents would need to file a challenge in court.