Kansas City’s licensed taxi business is about to all but disappear. But not its taxis. On Monday, Missouri Gov. Eric Greitens signed a law pushed by ride-hailing companies Uber and Lyft. It poses lighter regulation than Kansas City’s ordinance governing drive-for-hire businesses. Crucially, it declares that the rules passed in Jefferson City trump those adopted by City Hall.
That Kansas City ordinance had been designed, amid much debate, to adapt to the app-driven business models used by Uber and Lyft. Those companies recruit vehicle owners to make themselves available to customers using smartphone apps to hail a ride. The city wanted those businesses to operate under the same rules as traditional cab companies, including stringent background checks on drivers.
On Tuesday, the CEO of Kansas City’s dominant taxi business said that all but about 40 of the roughly 450 vehicles the company operates won’t bother with a city license come fall. Instead, said Bill George, cabs that have operated under the Yellow Cab and 10/10 Taxi will be shifted to zTrip, a “transportation network company,” or TNC — subject to the same state licensing standards as fellow TNCs Uber and Lyft.
“We were ambivalent about the bill” that Greitens signed into law, George said. “But it gave us the flexibility we needed. … We’re always going to survive.”
Scott Wagner, Kansas City’s mayor pro tem and chairman of the council’s finance committee, said he was disappointed that the state had taken control of overseeing the businesses. “I never celebrate when the city is pre-empted from what it should be able to do,” the council member said. “I am a little disappointed about the decision to transition taxis over to TNCs. But I’m not surprised, because it’s always been the desire to treat those the same.”
City Hall could lose some revenue if it’s licensing fewer taxis, but it also will have less work to do on inspections and background checks, said Assistant City Manager Rick Usher. “That’s a decision that the state has made,” he said. “Once it’s law, the governor has signed it, it’s just a matter of complying with that. … I don’t think it’s worthwhile for the city to have a chip on our shoulder about regulatory power.”
George said Yellow Cab would continue to get city licenses for 40 to 50 traditional taxis, at a cost of $250 each, so that those vehicles can pick up passengers hailing rides from the curb at Kansas City International Airport. The rest of the fleet will take a can’t-beat-’em-join-’em approach to competing with Uber and Lyft.
Under the zTrip brand, the cars will be available by smartphone app. George notes that unlike the better-known ride-hailing networks that grew out of Silicon Valley, his zTrip cars will also be available by dispatch, can be booked in advance and will accept payments not just through an app, but with credit cards and cash. “We’re all picking up riders on demand for a fare,” George said. “We’re all in the same business. As long as we all have the same flexibility, I’m fine with the new rules.” He expressed a slightly different view. wf