VA to Uber, Lyft: You can do business for now if you follow the rules

By Kathryn Watson | Watchdog.org, Virginia Bureau

ALEXANDRIA, Va. — The Old Dominion is open for business to rideshare companies Uber and Lyft — at least, for now, and with lots of strings attached.

Gov. Terry McAuliffe and Attorney General Mark Herring announced Wednesday the commonwealth has reached a temporary agreement with the two companies that allows them to operate, so long as Uber and Lyft comply completely with a slew of safety-related precautions.

The next battle for the two companies will be winning the legislation war come 2015, by which time the Virginia Department of Motor Vehicles will have completed a study of how best to allow the companies to operate in a well-regulated fashion.

In June, the Virginia DMV invited the rage of Uber and Lyft passengers, and the praise of taxicab companies that have run the show for years, when it sent cease-and-desist letters to the companies, urging them to stop operating or face fines because they didn’t comply with all of the state’s regulations. But public backlash and pressure from Uber and Lyft forced the state to reconsider in what has become a very tangible tale of free markets, government regulation and the role the government should or shouldn’t play in keeping its citizens safe.

Uber allows riders to check driver satisfaction ratings — and allows drivers to check rider satisfaction ratings — before selecting a ride nearby, all from a smart phone app. Lyft works similarly.

Herring, who sent out a letter to supporters with the rideshare update and used that opportunity to ask for donations as a “P.S.,” insisted this cooperation is the best way to keep Virginians safe.

“I knew there had to be a better way to ensure the safety of Virginia passengers,” Herring said in a statement. “These companies offer services that Virginians want, but it just wasn’t acceptable for them to operate without complying with regulations or other measures to help ensure the safety of passengers and motorists. I’m proud that we were able to get folks back to the table and get them talking again, and now we’ve shown that Virginia can be responsive to innovative businesses while promoting public safety and the rule of law.”

McAuliffe focused on the business angle, saying that, “In order for Virginia to remain economically competitive, it is important that we welcome innovative companies like Uber and Lyft and provide them with the resources they need to safely and effectively operate in the commonwealth.”

Virginia is just one of the many places where Uber and Lyft have had to wrestle with government officials and regulations to do business, and where rideshare companies and their lobbyists have gone up against the more established taxicab lobbyists. Similar stories have arisen from New York to New Mexico.

Uber and Lyft expressed appreciation to Virginia’s leaders — but didn’t celebrate too soon.

“The temporary authority granted by the state ensures that we continue to provide the Uber you know and love for the short-term,” reads an email from Uber to users. “But the work isn’t done yet. We’ll need your voice again in January when legislators are back in session to make sure they pass legislation that permanently allows us to operate.”

State officials haven’t said how long the temporary agreement lasts.

— Kathryn Watson is an investigative reporter for Watchdog.org’s Virginia Bureau, and can be found on Twitter @kathrynw5.