Just days after the City Council passed an ordinance designed to regulate transportation networks, Uber has shut down its service in Galveston.
Monday evening, people in Galveston who tried to use the phone app to order a ride received a message that Uber is no longer available in Galveston
“Due to new regulations passed by Galveston City Council, Uber is no longer available in the city,” the message says. “We hope to resume operations in Galveston under modern ridesharing regulations in the future.”
The council passed those regulations on Thursday.
The rules require that ride-hailing companies apply for operators’ licenses from the city, and require the company’s drivers to apply for chauffeurs’ licenses.
As part of the licensing procedure, drivers have to go through a background check that includes a federal fingerprint analysis.
Uber has objected to cities, including Austin and Houston, who require fingerprint checks from its drivers. In other cities, the company claims that its business model does not allow for the time required to conduct such background checks.
“These new regulations will make it difficult for partners to earn extra money on a flexible schedule and create barriers to entry instead of improving access to reliable transportation options such as ridesharing,” Sharraz Maredia, the general manager of Uber Houston said in an message to drivers sent on Monday evening.
City officials say the fingerprint check can take up to two weeks to complete.
Uber and other ride-hailing companies have never been considered strictly legal in Galveston. Before Thursday, drivers were expected to follow the same rules as taxis, including driving clearly marked vehicles and having operating meters.
Drivers caught operating as part of a ride-hailing service were ticketed for operating without a license, among other violations.
Still, the company claimed that it gave “tens of thousands” of rides in Galveston last year.
The city issued 103 violations to between 35 and 40 drivers, according to city spokesman Michael Gray. Some of the drivers were ticketed for multiple violations.
The city council passed the new rules Thursday, ostensibly to allow ride-hailing companies to operate under the same requirements as taxi cabs. Local cab companies had asked for rules that require the same inspections and background checks that their industry is required to follow.
Galveston’s rules go into effect March 1.
According to Quorum Report, an Austin-based political newsletter, Uber also shut down its operations in Midland.
Midland had recently passed rules that required drivers to be permitted by the city. Those rules went in effect on Monday.
Maredia told Quorum Report that the company had about 1,000 drivers in Galveston and Midland combined, and that the company was shifting its strategy to “focus on markets that acknowledge the benefits of ridesharing.”