The DMV’s position is that state law requires anyone who wants to make a profit off driving passengers somewhere get proper authorization from the state. But the business models of services like Lyft and Uber involve regular drivers making a few bucks by giving rides to people in need of a pick-up, and doing so without the standard formalities of taxi licenses, medallions, or whatever the local laws require.
Virginia has already hit both Uber and Lyft with thousands of dollars in penalties for alleged violation of the state’s passenger carrier laws, but yesterday, DMV Commissioner Richard D. Holcomb issued cease-and-desist letters to both of the companies, making it clear that the state believes these operations are illegal.
The letters [Uber version; Lyft version] also remind the companies that the DMV will issue civil penalties to Lyft and Uber drivers “that do not have authority to provide transportation for compensation.”
The DMV points out that while there is an exception for ride-sharing in the state’s passenger carrier laws, that exception requires that no profit be made.
According to Holcomb, Uber and Lyft’s operations “are not ride-sharing arrangements as defined by Virginia law” because the companies make money.
The letter invites Lyft and Uber to be involved in the DMV’s current review of these laws and of ride-sharing services.
“DMV has invited Lyft and other stakeholders to participate in this study and will produce a final report before the next legislative session,” reads the letter “I strongly suggest that [the companies] focus [their] resources on participation in this study rather than continue illegal operations in the meantime.”
But a rep for Lyft claims the company is doing nothing wrong.
“We’ve reviewed state transportation codes and believe we are following the applicable rules,” reads a statement to the Washington Post. “We’ll continue normal operations as we work to make policy progress.”
Meanwhile, a rep for Uber tells the Post the company was shocked by the DMV letter.
“Uber has been providing Virginians with safe, affordable and reliable transportation options for months and has continued to work in good faith with the DMV to create a regulatory framework for ridesharing,” reads the Uber statement. “We look forward to continuing to work with the Virginia DMV to find a permanent home for ridesharing in the Commonwealth.”