Politics and Government

DFL lawmakers advance rideshare plan despite Uber, Lyft pushback

A committee meets in a crowded room
The Labor and Industry Finance and Policy Committee hears testimony regarding HF4746 during a meeting in St. Paul on Tuesday.
Ben Hovland | MPR News

A DFL plan designed to boost pay for rideshare drivers in Minnesota without driving away Uber and Lyft got its first public airing Tuesday at the Capitol. While drivers applauded the bill, Uber and Lyft said it still won’t work for them.

The plan would set both Minneapolis and statewide wages for drivers at $1.27 per mile and $0.49 per minute. Those rates are lower than those approved as part of a new Minneapolis city ordinance. City officials, though, backed the proposed compromise, and a Minnesota House committee advanced the proposal with members voting along party lines.

Even as the plan moved forward, officials with Uber and Lyft said the companies still expect to leave the Twin Cities region on July 1. The disagreement leaves about two weeks before the Legislature’s adjournment to refine the proposal or see if Uber and Lyft follow through with threats to leave the Twin Cities. 

Two representatives sit at a desk
Bill HF4746 co-authors Rep. Hodan Hassan (left) and Rep. Mohamud Noor listen during a Labor and Industry Finance and Policy Committee meeting in St. Paul on Tuesday.
Ben Hovland | MPR News

Rep. Hodan Hassan, DFL-Minneapolis, brought the bill before the House Labor and Industry Finance Policy Committee. She began the hearing by reading statistics showing most rideshare drivers in the Twin Cities metro area are people of color, immigrants and living below the poverty line, people “deserving of our protections.”

Hassan stressed rideshare driving is not a part-time job for many of the workers. Many rideshare drivers and members of the Minnesota Uber/Lyft Drivers Association.

While parts of the bill are acceptable, the rate structure is still a problem for doing business in Minneapolis, Uber representative Joel Carlson told the lawmakers.

A man speaks into a mic
Joel Carlson, a lobbyist for Uber, testifies during a Labor and Industry Finance and Policy Committee meeting in St. Paul on Tuesday.
Ben Hovland | MPR News

“We have this experience in other cities and we know when you price rides out of the reach of riders that utilization goes down,” he said.

It’s not clear if DFL Gov. Tim Walz, who vetoed a rideshare pay raise bill last year, supports the current language.

At an event Tuesday, Gov. Tim Walz told reporters that negotiations will move ahead on ride-share driver protections that can also satisfy Uber and Lyft, the dominant players in the industry.

Walz said progress is being made even if a deal isn’t in hand.

“Step in the right direction. There was a little bit of movement,” Walz said. “We've still got time. Hoping to get this done.”

The legislative language heads now to the Ways and Means committee, which is the last stop before it hits the House floor. It could be amended there or on the House floor. Lawmakers, though, must adjourn by May 20 and any final resolution could come down to the last minute.

Audio transcript

[MUSIC PLAYING] CATHY WURZER: The proposed framework between DFL lawmakers at the Capitol and the Minneapolis City Council over wages for rideshare drivers is moving ahead. This morning, a House committee approved the plan that aims to better compensate Uber and Lyft drivers, although the companies say the plan does not work for them. MPR'S Clay Masters was there and joins us with more. Hey, Clay.

CLAY MASTERS: Hi, there.

CATHY WURZER: This is a new proposal hammered out. It was teed up pretty fast at the capitol, wasn't it?

CLAY MASTERS: Yeah, it was a pretty quick turnaround from when the news broke yesterday afternoon about the deal lawmakers had reached with the city council. Reminder, they proposed a minimum wage rate of $1.27 per mile and $0.49 per minute. Those numbers are lower than rates approved as part of a Minneapolis City ordinance.

But this agreement is not endorsed by all parties. The dominant rideshare companies, Uber and lyft, say they still plan to leave the Twin Cities metro on July 1, even with these new rates. And remember, not a lot of rideshare users outside the Twin Cities. Today, the house labor and industry finance policy committee heard testimony from just a lot of rideshare drivers. The labor commissioner, as well as representatives from Uber and Lyft and committee members, passed the bill along party lines to send it to yet another committee before it would hit the House floor.

CATHY WURZER: Describe what the hearing was like today.

CLAY MASTERS: Yeah, the room was almost full as the committee heard testimony. A lot of drivers, members of MULDA, were there. That's the Minnesota Uber Lyft Drivers Association. This bill was brought forward by Minneapolis DFL Representative Hodan Hassan. She started things off by reading some statistics about who these drivers are-- immigrants, people living below the poverty line, and that it's not just a part-time job.

HODAN HASSAN: The reason why I'm sharing these numbers is to underline the importance of protecting these members of our community who are predominantly BIPOC, new Americans, low income, and deserving of our protections.

CLAY MASTERS: Drivers followed with passionate testimony of their own. Here's Marianna Brown with the group MULDA.

MARIANNA BROWN: We have to pay gas, insurance. All our expenses come from that $0.06 to $0.08. At the end of the year, we have to pay taxes. Do you know my-- I owe taxes from last year. We have to pay taxes from the little that we make.

CATHY WURZER: So I'm wondering here, Clay, did this hearing offer any first remarks by anyone from Uber or Lyft?

CLAY MASTERS: Yeah, they obviously said yesterday that they didn't think this plan was workable. Uber's current offer was $0.68. That's what Ms. Brown was just referring to in that sound clip we heard. Lyft has called for the low end of a state reports metro range, which was $0.89.

And remember, Cathy, the current proposal that they were voting on is a $1.27. So Joel Carlson represents Uber. He says, while there are parts of this bill that are acceptable, the rates are still a problem for doing business here.

JOEL CARLSON: We have this experience in other cities. And we know that when you price rides out of the reach of riders, that utilization goes down.

CLAY MASTERS: So other remaining sticking points involve how the companies handle appeals from drivers who are removed from the ranks. This one comes down to how fast the rideshare companies have to respond, yet another thing that lawmakers will still have to through. Representative from Lyft echoed a lot of the same sentiments that Uber brought forward.

And we heard from House Majority Leader Jamie Long yesterday on the proposal, some call it compromise. And he thinks Uber and Lyft are bluffing about vacating. Again, Uber and Lyft say at this point, they plan to leave in July.

CATHY WURZER: Now, we should say that this issue has been going on for a couple of years at the Capitol. And last year, the governor vetoed a bill that would have raised pay for the rideshare drivers. So any indication as to what Governor Walz thinks of all this.

CLAY MASTERS: Yeah, the lead Republican on this committee actually asked point blank to the state labor commissioner if Governor Walz supports the language. She didn't give a yes or no answer, just that he supports a minimum compensation that is supported by the study his administration put forth after his veto last year. But in a statement to MPR News yesterday, a Walz spokesperson tells us it's a positive step in the right direction, he says, that indicates all parties are continuing to work together. And the governor will continue discussing the issue with legislative leaders over the coming days.

CATHY WURZER: Not many days left on the calendar here, just a couple of weeks left in session. So, what can happen between now and May 20th when they're scheduled to adjourn?

CLAY MASTERS: So next, this language is headed to the Ways and Means Committee. That's the last stop before it hits the House floor. They could amend it there if there are some agreed-upon tweaks or they could amend it on the House floor. But like you said, lawmakers must adjourn by May 20th, and this thing could all come down to the last minute as Minnesotans are just waiting to see how they'll use rideshare services going forward.

CATHY WURZER: All right. Clay masters, thank you.

CLAY MASTERS: Yeah, you're welcome.

CATHY WURZER: That's MPR News Senior Politics Reporter Clay Masters.

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