by Donald Wood
Last updated: 12:30 PM ET, Mon May 9, 2016
On Saturday, ride-hailing companies Uber and Lyft suffered a major blow as voters in Austin, Texas, upheld a regulation that would require drivers to submit fingerprint background checks.
As a result, both Uber and Lyft will halt operations in Austin.
According to Reuters.com, Uber and Lyft spent over $8 million to persuade voters to repeal the ordinance regarding drivers submitting fingerprint background checks, but the companies lost the battle by a vote of 56 to 44 percent in favor of keeping the current regulations.
Uber and Lyft reportedly outspent their opponents by 80-to-1 in an effort to repeal the rules, equating to more than $200 for each vote. The ride-hailing companies believe their current background checks are rigorous and ensure safety, but the voters in Austin felt the addition of fingerprinting would make the checks even more thorough.
"Disappointment does not begin to describe how we feel about shutting down operations in Austin," Uber's Austin General Manager Chris Nakutis told Reuters.com.
One major concern for Uber and Lyft is that the precedent set in Austin could become the launching point for other cities to begin a similar battle requiring the companies to provide fingerprint background checks for drivers.
"Lyft and Austin are a perfect match and we want to stay in the city," said Lyft in an official statement obtained by The Guardian. "Unfortunately, the rules passed by City Council don't allow true ride sharing to operate. Instead, they make it harder for part-time drivers, the heart of Lyft's peer-to-peer model, to get on the road and harder for passengers to get a ride. Because of this, we have to take a stand for a long-term path forward that lets ride sharing continue to grow across the country, and will pause operations in Austin on Monday, May 9."
For the latest travel news, updates and deals, subscribe to the daily TravelPulse newsletter.
Topics From This Article to Explore
