For better or worse, the city of San Francisco is introducing legislation that will require a number of Lyft and Uber drivers to obtain a business license. This applies to the 37,000 drivers who work in the city seven or more days a year, according to a report from SFGate. It is not clear why this is coming about, and City Treasurer Jose Cisneros has not been much help in that regard. He has said, however, that the city launched its online business registration system just last month. Before then, registrants had to apply in person at City Hall.
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The ridesharing business has clashed with the city before. When drivers sued for employee status, the companies argued that the drivers were independent contractors. With this new system, the city is saying that’s just fine, but now the drivers have to register as such and obtain business licenses. The licenses will cost $91 per year for drivers who make $100,000 or less in gross receipts. If this is not a driver’s first year, the driver will have to make payments of back fees for the years that they weren’t registered.
It is believed that the city now has the names of the drivers, though Uber and Lyft have regularly refused to provide this information, and Cisneros is keeping mum on his sources. His letter will be sent out in three batches on Friday, Monday, and Tuesday. The recipient drivers will be notified that they due to their activity as a transportation network company, they must register for a business license within 30 days or face penalties.
“We have a very broad and comprehensive business registration requirement,” Ciseneros said. “This has been a law that has been around for many years. It’s very clearly spelled out on our website — the law here in San Francisco requires you to register your business with the city. If they missed that requirement, they are still obligated to do that.”
Uber is not planning to fight, according to an email from spokesperson Laura Zapata: “Uber partners with entrepreneurial drivers and as independent contractors, they are responsible for following appropriate local requirements.”
Lyft, on the other hand, is not so obliging. “We have serious concerns with the city’s plan to collect and display Lyft drivers’ personal information in a publicly available database,” wrote Lyft spokeswoman Chelsea Wilson in a related email. “People in San Francisco, who are choosing to drive with Lyft to help make ends meet, shouldn’t have to compromise their privacy in order to share a ride.”
The initiative is expected to generate over $3 million dollars annually for the city.