City Council won’t appeal state rules for ride-sharing services

A motion to appeal California’s new rules for ride-sharing services failed by one vote Wednesday at a Los Angeles City Council meeting, capping months of debate about the city’s role in regulating the new taxi competitors.

The appeal motion, which needed eight votes for approval, failed on a 7-6 vote. It would have laid the groundwork for a lawsuit against the California Public Utilities Commission, which last month created the nation’s and the state’s first regulations for ride-sharing firms such as Lyft, Uber X and Sidecar.

Instead, the council voted unanimously to ask the PUC for certain changes and additions to the regulations, which will be discussed in further detail by a council committee. The proposals could include limits on greenhouse gas emissions and fingerprinting requirements for drivers, said Councilman Mike Bonin, who sponsored the motion. The city has until next September to request changes.


“A new economy is emerging,” Bonin said during a brief interview Wednesday. “The right way to address this is to create a new structure, rather than trying to make this industry meet existing definitions.”

Ride-sharing services use smartphone apps to connect drivers to people who need a ride. Drivers who use their own cars often charge less than cabs.

The Los Angeles taxicab industry, long a political force at City Hall, has maintained that the ride-sharing firms have an unfair business advantage because they are not regulated or inspected by the city.

Mayor Eric Garcetti has voiced his support for the ride-share companies and has said he would work with the city’s nine franchised taxi companies to “adopt similar innovations.”

Several council members, however, said the new PUC regulations put Los Angeles drivers and passengers at risk.

Councilman Paul Koretz, who sponsored the appeal motion, said the PUC did not have enough staff to enforce the regulations. Drivers will be required to undergo criminal background checks, receive training and carry insurance policies with a minimum of $1 million in liability coverage.

“We will do this until we have the first couple disasters, and then we will have to rethink it anyway,” Koretz said. “Why not do it now?”

Cab companies and their owners have provided at least $5,200 in donations to Koretz’s campaign and office-holder account since 2009, the year he was elected to the council. Councilman Curren Price won his seat this year after a political action committee set up by the taxicab companies spent nearly $27,000 on his behalf.

That same committee spent more than $49,000 to promote the candidacy of Councilman Gil Cedillo, who took office July 1.

“This, quote, new emerging industry wants to be exempt from a criteria and a standard that is well-established,” Cedillo said.

Times staff writer David Zahniser contributed to this report.