City requires business licensing fees for ride-hailing companies

Ride-hailing companies such as Uber and Lyft will need to pay more fees if they want to keep operating in Las Vegas.

The Las Vegas City Council voted 4-2 Wednesday to begin charging the transportation networking companies a $50 semi-annual business licensing fee for each "active driver" who operates within the city over a six-month span.

Councilmen Bob Coffin and Steve Ross opposed the bill. Mayor Carolyn Goodman was absent from the vote as she was attending the U.S. Conference of Mayors in Washington, D.C.

About 30 people wearing pink Lyft T-shirts sat in the audience for the vote, but none spoke during the public comment period at the beginning of the meeting. It wasn't immediately known if Uber or Lyft plan to sue.

The new charges add to a growing list of fees for the transportation network companies in Southern Nevada. Companies that use apps or social media to connect drivers to passengers already have to carry business licenses from the state as well as Clark County. Henderson and North Las Vegas have no such requirements.

According to Las Vegas' new licensing law, the "active driver" number will come from a bit of simple math: The companies will report the number of drivers each month, and the city will take the average per-month number over six-month periods to come up with the number of "active drivers." That number will be multiplied by the $50 fee to come up with the final license price.

The money collected for the business licenses will go into the city's general fund, according to a city spokesman.

The fees levied by Clark County are slightly different than those in Las Vegas. The county uses a yearly, tiered-rate system that ranges from $1,000 for fewer than 100 drivers to $75,000 for 7,000-plus drivers. It also charges the drivers a $25 business license fee.

State-level fees paid to the Nevada Transportatipn Authority, which are good for two years, are even pricier. Having fewer than 100 drivers costs $6,000. If a company uses more than 7,000 drivers, it will have to pay $500,000.

The 2015 Legislature paved the way for companies such as Uber and Lyft to operate in Nevada. By September, both companies were up and running in Southern Nevada and have been operating with temporary business licenses from the city since. They will need to pay for the new licenses in March when the temporary ones expire.

Both Lyft and Uber criticized the city's decision.

"People in Las Vegas want options like Lyft, and we'd encourage the council to make it easier — not harder — for visitors and residents to get around," said Lyft spokeswoman Chelsea Wilson. "Rather than hit ride sharing with a duplicative tax, the City should encourage innovative new industries to grow."

"We are disappointed by today's city of Las Vegas City Council vote," Jason Raddison, general manager for Uber Nevada, said in a statement. "We believe that the city's action directly conflicts with existing state law and we are considering all of our options."

Coffin told the Review-Journal he took no issue with the fee, calling it a "reasonable number," but said he voted against the bill because it didn't address the safety of the passengers.

Coffin said he'd like to have the ride-hailing drivers go through the same fingerprinting and background process as taxi drivers, and thinks the city could offer a discounted license rate if that were done.

Contact Colton Lochhead at clochhead@reviewjournal.com or 702-383-4683. i him on Twitter: @ColtonLochhead.