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LA City Council’s Proposed Challenge To Ridesharing Services Fails

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(credit: PAUL J. RICHARDS/AFP/Getty Images)

(credit: PAUL J. RICHARDS/AFP/Getty Images)

LOS ANGELES (CBSLA.com) — The Los Angeles City Council won’t be challenging a state regulation that gives smartphone-enabled rideshare services like Lyft and Uber permission to operate in California.

The city’s appeal of the Public Utilities Commission’s rules failed on a 7-6 vote as Wednesday’s deadline for appealing approached. The city’s appeal was proposed by City Councilman Paul Koretz.

Mayor Eric Garcetti, who supports the rideshare companies, had threatened to veto any decision to pursue an appeal.

Instead of appealing the rules, the City Council decided to pursue modifications to the rules while PUC works to fine-tune its regulations.

The Council will ask the PUC to address the city’s concerns over “insurance, safety, greenhouse gas emissions, red-lining and access for people with disabilities as well as other concerns that may be raised by other members of this council,” City Councilman Mike Bonin said.

Proposed modifications will likely be discussed in the City Council’s Transportation Committee, which Bonin chairs.

Last month, the PUC signed off on regulations that classifies phone-app-enabled rideshare services as “transportation network companies.” Such companies allow people in need of rides to use a downloadable smartphone app to make arrangements with those willing to drive them to their destinations, often for a fee.

Under the new rules, the rideshare companies must get a license from the PUC, require criminal background checks of drivers, create a driver training program, adopt a “zero-tolerance” policy on drug and alcohol use, buy commercial liability insurance policy with a minimum $1 million coverage and do a 19-point car inspection.

Opponents of the regulations had until Wednesday to submit their request to have the PUC reconsider the new rules, which were approved in September. The step is necessary to pursue future legal appeals in court, city officials said.

Officials with Yellow Cab said the company was appealing the rules. Cab company representatives said that the PUC regulations essentially legalizes “bandit taxi” companies.

(©2013 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services contributed to this report.)

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