(The Center Square) – The Minneapolis City Council passed an ordinance starting Jan. 1, 2024, that ride-share companies say will force them out of the city because of increased costs and regulations.

The vote passed 7-5-1 to enact a minimum compensation of $1.40 per mile and $0.51 per minute while transporting a rider, subject to annual adjustment.

Minimum compensation only applies for ride portions occurring within the city and the per-mile and per-minute minimum rates would be tied to the municipal minimum wage every Jan. 1.

In an email sent to frequent customers Monday, Uber said the legislation “could force Uber to leave the city.”

downtown minneapolis
Aaron Galloway, Townsquare Media

The email said the legislation would “greatly limit our ability to remove unsafe drivers from the platform, including drivers accused of sexual assault, harrassment, impaired driving, or discrimination”, and significantly increase the ride of Minneapolis’ Ubers to possibly more than Manhattan costs.

READ MORE: Private Minnesota Company Just Posted Largest Revenue In U.S.

The ordinance moves to Mayor Jacob Frey, who holds veto power over the proposal but whose office hasn’t yet sent a statement of his position.

Ward Six Council member Jamal Osman welcomed the passage.

“Just as any other employee in Minneapolis deserves protection, drivers should also be afforded the same rights and protection,” Osman told The Center Square in an email.

Minneapolis traffic
Canva/Getty Images

“The corporate pressure presented by Uber and Lyft to withdraw their services is absurd. Uber and Lyft trying to scare us with their threat to leave doesn't impress us. These companies need to care more about their drivers than just making money. We won't give in to their pressure tactics. We're standing strong together. It’s time for these corporations to prioritize their drivers over corporate greed.”

SEE ALSO: How Heinz Offended the Entire State of Minnesota

In a letter to the council, Lyft said the ordinance “could turn rideshare into a luxury service…” by doubling trip costs within Minneapolis.

“A trip today that would cost $20, could cost $40 next year,” the letter said. “Simply put, most Lyft riders in Minneapolis could no longer afford to use Lyft.”

Minneapolis City Council members Robin Wonsley posted on social media: “Today we are proud that the majority of the Minneapolis City Council stood with @TheMulda against corporate lobbyists and passed a policy that will protect basic workers’ rights and provide dignified wages for thousands of Uber and Lyft drivers.”

In a statement, Uber said “We are disappointed by the results of yesterday's vote and the overall process in Minneapolis. We are determining next steps.”

Lyft hasn't yet responded to a request for comment.

106.9 KROC-FM logo
Get our free mobile app

LOOK: Cities with the Most Expensive Homes in Minnesota

Stacker compiled a list of cities with the most expensive homes in Minnesota using data from Zillow.

Minnesota Cabin on Lake Superior is the Sexiest Airbnb

I would argue that this Minnesota Airbnb that's right by Lake Superior is the sexiest Airbnb in the state. Check out the pictures.
The Center Square is a project of the 501(c)(3) Franklin News Foundation. We engage readers with essential news, data and analysis – delivered with velocity, frequency and consistency. If you would like to read the original article, click here.

More From 106.9 KROC-FM