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LAS VEGAS — The Vegas Strip is ground zero for a $400 million transportation turf war and the win is still up for grabs.
The fight over the profitable taxi territory started in October 2014, when the mobile app Uber set up shop in Reno and Las Vegas, arguing current laws regulating taxicabs didn’t apply as they are not a transportation company, but rather a tech company, according to company officials.
A Nevada judge didn’t buy Uber’s arguments that it is immune to transportation regulations and ordered Uber to shut down. With 41 million annual visitors in Las Vegas alone at stake, the company isn’t running away. In fact, it’s turned to old-school methods to get what it wants: lobbyists.
Uber has hired 16 lobbyists to push two bills through the Nevada legislature that would establish a framework by which it could legally operate. The ride-sharing company has tried the same strategy in dozens of other cities and states, often with successful results. But Nevada has been one of the toughest markets to penetrate, in part because of the powerful cab industry.
“What you are talking about is people who are in the industry for a long time, having relationships with people who have been in the legislature for a long time, and it just keeps passing on,” said Rick Vellota, a veteran reporter for The Las Vegas Review Journal.
According to campaign records, the taxicab industry has contributed at least $750,000 to various elected officials in the Nevada legislature since January 2014. It has hired a fleet of lobbyists and consultants to work the Capitol.
The industry’s grip is most apparent in Las Vegas, where not one new taxicab company has been allowed to open since 2001, according to the Nevada Taxicab Authority, which is charged with approving new cab companies. That agency receives most of its funding from fees paid by the cab companies it regulates.
All of this, Velotta says, may be why the Vegas taxi industry is sometimes referred to as a cartel.
“They have so much control over what is going on in the industry,” Velotta said. “Families have been in charge of these companies for years … for at least three generations in some cases.”
So far, the cab companies are winning the taxi wars. Earlier this month, one Uber bill already lost in the Senate in an 11 to 10 decision, failing to get a two-thirds majority. However, some of the language of that first bill has been added to a second bill that might pave the way for Uber to open for business in the state. That bill may go for a vote as early as next week.
If both bills fail, Uber will have to wait a while to lobby for another one: Nevada’s legislature only meets every two years. For now, it’s unclear if Nevada will become the 42nd state to allow Uber to operate, which isn’t exactly surprising to Vellota.
“We are not going to be like everybody else,” he said. “And sometimes that means we put the brakes on progress. Sometimes it means that we don’t accept things that are accepted everywhere else. That’s just how Nevada is.”
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