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Kansas City Council Closes Lyft Loophole

Via Tsuji
Flickr / Creative Commons

Transportation company Lyft says it will find you a friend with a car via mobile device app. But, the Kansas City, Mo., City Council says the company is running a taxi cab service and trying to loophole its way out of city regulations covering drivers, vehicles and insurance.

The council amended to its “livery service” ordinance Thursday to make it clear the city makes no distinction between charging a fee for a ride and asking for a “suggested donation,” which is the way riders were to begin paying for the service within the next few days. Mayor Sly James said he had no problem with the service concept, but does object to the company's disregard for city regulations and ordinances.

Drivers register for the service electronically and are matched with riders through the Lyft app. Lyft has been offering rides in Kansas City for about two weeks, and a number of its drivers have been ticketed for operating taxi cabs without the required livery licenses.

The Lyft company has contended that the licensing requirements do not apply rather than being charged fare, riders are "requested to make a donation" of a suggested amount.

The city has maintained that the practice constituted charging a fee.

Despite objections from two members, the council bypassed the usual process of committee review and public hearing on the language change, honoring the city attorney's request to pass the clarifying language before Lyft ended its initial two week “free sample ride” promotion.

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