After getting contentious in Thursday's Minneapolis City Council meeting over a rideshare ordinance that would raise the mandatory minimum wages for Uber and Lyft drivers in the city, the council ultimately passed it, threatening rideshare services across the city.
The ordinance will increase pay for Uber and Lyft drivers in the city, a move those companies have threatened to leave the city over. The change guarantees drivers get 80% of canceled rides and earn no less than $5 per ride.
Minneapolis Mayor Jacob Frey plans to veto the ordinance and calls Thursday's action by the council "irresponsible". While he supports higher pay for drivers, he said the Council's ordinance goes too far. Despite his veto, there are enough votes on the council to override it.
Rideshare company Uber released a statement Thursday afternoon, essentially saying they will stop operating in Minneapolis if the ordinance takes effect as planned May 1. However, Uber supports a statewide proposal to pay all drivers 35-dollars an hour. If that legislation is enacted, superseding Minneapolis' ordinance, Uber says it would bring rideshare service back to the city.
Uber also accused the City Council of "hijacking" the state's process and said most members of City Council refused to meet with ridesharing companies or look at the data they provided. Uber says it has been fully engaged with the State of Minnesota to assess driver earnings, and that the Department of Labor and Industry is conducting a study on earnings and benefits that is informed with hard data.
This comes after information was introduced that a state report on the issue is set to come out Friday. That report is from a task force created by Governor Tim Walz to make recommendations on driver pay statewide, after a similar measure had been introduced during 2023's Legislative Session.
That state bill was passed by the legislature but Walz did veto it after both Uber and Lyft threated to cut service in the state. He then ordered further studies on the legislation and set up a task force.
Some councilmembers had been saying the city should wait two weeks to vote on the ordinance and take the state recommendations into consideration because its the "wise and prudent thing to do."
"We have an ordinance in front of us right now that will get drivers minimum wage and we should proceed with that and rip the band aid off," said Councilmember Robin Wonsley. "Just do it."
"I do support taking that data from the state and making sure that it is informing this policy going forward," said Council President Elliott Payne.
Both the Minneapolis Regional Chamber and Minneapolis Downtown Council had asked the City Council to delay passing the ordinance until more information became available.
“Today, the Minneapolis city council voted to end ridesharing not just in Minneapolis, but potentially across the entire state of Minnesota," said Jonathan Weinhagen, President and CEO of the Chamber. "The business community has been asking for patience while the ridesharing task force appointed by Governor Walz compiles statewide data that will be helpful in guiding this conversation. By moving forward without the benefit of that information, nine city councilmembers could be taking away a transportation option that has been helpful to underserved communities, people with disabilities, and Minnesotans traveling to events, the airport, work, and appointments around the state.”
Drivers WCCO Radio spoke to said they weren't afraid of losing rides within the city and stood by the Council's decision.
"It's a good step for the city council members, I give them credit," said one driver who spoke anonymously to WCCO Radio. "They have a job to do, so they did not defer their job waiting for information from a government."
Another driver told WCCO he doesn't believe the threats to leave Minneapolis by rideshare companies.
"What I'm saying is Uber and Lyft will never leave the city, never, because they make a lot of money," said a driver. "They don't give us money. So this is just like talking. They will never leave the city."
“We’ve seen the excitement and economic impact of everything that happens in Downtown Minneapolis – whether it’s this week’s Big Ten Women’s Basketball Tournament, world-class theater performances, or the Twins, Timberwolves, Lynx, and Vikings," says Adam Duininck, President and CEO of the Downtown Council. "This policy won’t just hurt Minneapolis, it will hurt our region and our state. The last thing we need as people continue to visit Minneapolis – either from around Minnesota or from other states – is to have ridesharing not available. Frankly, it would be embarrassing and would diminish our standing as a world-class destination. We are encouraging Mayor Frey to veto this ordinance and are hopeful the City Council will uphold that veto and choose to work collaboratively in an approach that involves all stakeholders – ridesharing companies, drivers, policymakers, and the community – to address concerns and strike a balance that will keep ridesharing operating here.”
Councilmember Jamal Osman says he's not worried about Uber and Lyft and certainly not worried about an impending veto from the mayor.
Rideshare companies are still operating in New York City, New York state, and Washington state, which all passed new rules or legal ordinances that require higher driver pay.