Uber Annouces Plan to Leave Houston if City Keeps Existing Regulations

Uber announced Wednesday that the company plans to cease operations in Houston if the city council does not repeal its existing regulations relating to vehicle-for-hire companies.

Houston is one of two cities in the country where Uber continues to operate despite a local requirement that its drivers undergo fingerprint-based background checks. Uber has recently left three cities in Texas for approving similar regulations and has threatened to do the same in Austin.

The company's main competitor, Lyft, pulled out of Houston over a year ago in response to the new rules requiring its drivers to undergo fingerprint-based background checks. Uber had continued to operate in the city while publicly criticizing the regulation as burdensome.

"We have worked hard and taken extraordinary steps to help guide drivers through the current process in Houston," said Uber General Manager Sarfraz Maredia in a letter to Houston City Council on Wednesday. "However, a year and a half later, it is clear the regulations are simply not working for the people of this city."

Uber also released a report Wednesday on "The Cost of Houston's Ridesharing Regulations." The report claims Houston's regulations have led to a decrease in Uber drivers and, in turn, "fewer safe rides."

"Since the regulations were adopted, more than 20,000 people in Houston have completed Uber’s thorough screening process but did not proceed with the City’s multi-step licensing process and as a result, were unable to drive," Maredia wrote in the letter. "Houstonians who could most benefit from such flexible economic opportunities are often the ones who are least able to access them."

Houston's ordinance requires vehicle-for-hire drivers to apply for a specialized license in order to operate within the city's limits. This license includes a required fingerprint background check.

Uber has recently ceased operations in Corpus Christi, Galveston and Midland after the cities adopted similar background check requirements. In Austin, voters will decide on May 7 if the city should adopt a proposed ordinance, strongly backed by Uber and Lyft, that would prevent the city from requiring such checks.

Uber said the company will leave Austin if the ordinance is not adopted, despite recent reports from The Daily Dot that Uber has told drivers it will continue to operate in the city regardless of the outcome.

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Disclosure: Uber and Lyft have been financial supporters of The Texas Tribune. A complete list of Tribune donors and sponsors can be viewed here.