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August 14, 2013 at 7:42 AM

Seattle on shaky legal ground in limiting taxi licenses

Taxis protest the lack of regulation for services like Uber and Lyft in Seattle on Aug. 2, 2013. (Genevieve Alvarez / The Seattle Times)

Taxis protest the lack of regulation for services like Uber and Lyft in Seattle on Aug. 2, 2013. (Genevieve Alvarez / The Seattle Times)

The city of Seattle limits the number of taxi licenses to 850. That number has not kept up with demand as unlicensed competitors such as UberX, Lyft and Sidecar have crept into the market.

These new services, powered by smartphone apps, should be regulated by the city for safety, but I also argued that it’s time for the city to lift its cap on taxi licenses in a Tuesday column, “End the city’s taxi monopoly and let Uber roll.”

A Seattle City Council committee is studying demand for ride services in Seattle and could raise the total amount of licenses allowed, change the strange division between “taxi” and “for hire” licenses and require the new services to be regulated for safety.

If the city continues to limit the number of taxi licenses, it could risk potential litigation.

In April, a Milwaukee Circuit Court judge ruled its taxi monopoly was illegal and ordered the market opened. In Minneapolis, a U.S. District Court judge also ruled its taxi cap illegal in 2006. The Arlington, Va., nonprofit Institute for Justice was involved in both lawsuits.

Here is more legal information from the Institute for Justice on the Minneapolis ruling, which survived appeal. The plaintiffs in the case were Luis Paucar, an immigrant from Ecuador who tried to start a taxi and limousine service in Minneapolis, and Blanca Prescott, a blind, single mother of three who relied on taxis for transportation. Minneapolis reformed its laws in 2006 to issue 45 new licenses twice a year from 2006 to 2010, then lifted the cap, according to the Institute for Justice.

In Milwaukee, the U.S. District Court judge ruled the city-created monopoly illegal. Here is the Institute for Justice’s summary of the case, and here is the Milwaukee Journal-Sentinel’s editorial, which also argued in favor of lifting the cap. Our editorial board urged the city of Seattle to consider lifting the cap in this editorial.

Institute for Justice is a libertarian organization. While I’m not libertarian, I am clearly having a moment. In fact, declared libertarian and editorial writer Bruce Ramsey said he liked my column Tuesday. He’s clearly trying to woo me over to the dark side. Next thing you know, we’ll be smoking dope together. (He wrote about lighting up in this column.)

Comments | Topics: Seattle City Council, taxis, transportation

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