Ride-share service Lyft gets OK from NY regulators

Dara Jenkins, a driver for the ride-sharing service Dara Jenkins, a driver for the ride-sharing service Lyft, uses Lyft's smartphone app to see where other drivers working at the same time on March 12, 2014. Photo Credit: AP

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The ride-sharing service Lyft began operating in New York City last night, under an agreement with the state to use only commercial drivers.

San Francisco-based Lyft, whose vehicles are distinguished by a pink, fluffy mustache on the front, won't be importing its business model from other cities under which drivers in their personal vehicles chauffeur passengers in exchange for donations. The service initially resisted abandoning its model but has relented.

Lyft spokeswoman Paige Thelen said the service would begin with a "limited beta test" to be followed with a full launch in the coming weeks.

Earlier this month, Lyft provoked the ire of the city and the taxicab industry with a plan to place unauthorized cabs on city streets. A state judge ordered a halt to that plan with just hours to go

The city's Taxi & Limousine Commission spokesman, Allan Fromberg, said Lyft agreed to a slew of agency regulations, including being licensed for for-hire service, drug testing, fingerprinting, vehicle inspection and insurance.

Commission chairwoman Meera Joshi said in a statement: "We are pleased to welcome Lyft as a fully-licensed for-hire service in New York City."

New York State Superintendent of Financial Services Benjamin M. Lawsky and Attorney General Eric T. Schneiderman, who negotiated with the company, said in a statement: "Regulators can work constructively with companies so that new ideas can come to the market" with"smart regulation."

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Lyft vehicles, which prospective riders summon through a smartphone app, is competing with traditional street-hail taxis as well as those via the app Uber.

With Lyft's entrance into the market imminent, Uber on July 7 slashed its fares to be 20 percent cheaper than yellow cabs.

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