Local governments can’t deny a business license to ride-hailing companies if they’ve met all the other requirements that apply to the municipality’s businesses in general, according to state lawyers from Nevada’s Legislative Counsel Bureau.
The legal opinion issued Friday comes as Clark County officials work to amend their business license ordinance to create a special category for companies like Uber and Lyft, which allow passengers to hail a ride in someone’s personal car using their smartphone.
It also comes the same day that the Nevada Transportation Authority adopted final state regulations on ride-hailing companies.
Clark County business licensing officials said companies could apply to start operating there after the county ordinance is finalized, likely in October. That could mean Uber and Lyft cars wouldn’t hit the roads in Clark County for weeks after the companies receive a state permit from the Nevada Transportation Authority, which is expected to happen Monday.
But Clark County’s involvement might not jibe with the new state ride-hailing law passed this spring, according to state lawyers. They wrote that the law was meant to be comprehensive and “expressly prohibits the involvement and curtails general powers of local governments that would otherwise apply to transportation network companies.”
While the law doesn’t prevent a local government from imposing industry-specific business license fees on other types of businesses, it specifically bans them for ride-hailing companies, they added.
Clark County spokesman Dan Kulin said Friday that the county had no comment on the newly released legal opinion. It was not clear if any of Nevada’s 16 other counties planned similar local rules.
Local regulations could further delay the arrival of Uber and Lyft in Nevada, which is already behind the timeline lawmakers touted this spring. State senators previously said the companies could be up and running in July.
Uber briefly operated in Nevada last fall, but a judge ultimately ordered it to stop because it wasn’t abiding by the laws governing taxis and limos.
Lawmakers passed two hard-fought bills this spring that authorized the companies to operate in the state and imposed a 3 percent fare tax for taxi and ride-hailing companies.
The Nevada Transportation Authority then drafted detailed rules specific to ride-hailing companies. Among other things, the regulations that were adopted Friday call for an administrative fee to fund regulators and enforcement staff and require a decal placed on cars working for ride-hailing companies.
Taxi and limo interests have fought against the new legal framework for ride-hailing companies. Among other complaints, they say the setup endangers passengers because it doesn’t require Uber or Lyft drivers to undergo the pre-employment drug screening that applies to taxi drivers.
Ride-hailing companies instead have a “zero-tolerance” drug and alcohol policy and say they suspend drivers in real-time when a passenger reports a driver who might be under the influence.
Commissioners argued Friday whether pre-employment drug screening should be added to the rules, but the state transportation authority Chairman Andrew MacKay pointed out that the idea was considered and rejected by lawmakers multiple times this spring. Adding that requirement, he said, would go against the law.
“There is crystal clear legislative intent that drug testing isn’t to be considered,” MacKay said.