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Fargo to study higher rates, deregulation for taxis

FARGO - The taxi fares the city regulates have gone unchanged for nearly eight years, so the owners of Lucky Seven Taxi Service have asked the city to raise them.


FARGO – The taxi fares the city regulates have gone unchanged for nearly eight years, so the owners of Lucky Seven Taxi Service have asked the city to raise them.

What Laurie Dodd and her husband, Jeff, forgot from last time was every taxi company in town must agree before the city considers the proposal. Laurie Dodd said she wished it didn't have to be like that.

"We would like to be able to just regulate it ourselves," she said. "We don't feel like any other businesses that get licensed in Fargo are regulated on what prices they have to set."

She noted Uber, a ride-hailing app whose drivers provide the same service as taxis , don't have regulated fares.

The city hasn't gotten to the point of agreeing with total deregulation, but Lucky Seven's request has caused some introspection.


"What are we trying to regulate with the cab companies?" said City Auditor Steve Sprague, whose office regulates taxis. "Is it the safety and the condition of cabs? I don't know."

He also recognizes Uber, which is regulated by the state, operates on different rules.

"I just want to ask the cab companies, 'What can the city do to make a level playing field?'" Sprague said.

At 3 p.m. today, Sprague will convene a meeting with all taxi companies in Fargo to talk about it.

City laws now require taxi companies to be licensed with the city, have insurance coverage, be able to provide 24/7 service and stick to standard regulated fares.

These requirements aren't uncommon among cities that regulate taxis, according to economists. Some limit the number of taxis on the road to encourage broader use of mass transit, limiting congestion and air pollution. Some cap fares to prevent discrimination against consumers, such as those from out of town or in unpopular parts of town. Some require inspections to ensure cabs are safe.

Sprague said now is a good time to review Fargo's taxi regulations because the market has been changing rapidly in the past three to five years with more cab companies. There used to be just one or two cab companies, but now there are six plus Uber, he said.

Dodd complained that some don't follow the rules, such as providing 24/7 service, but aren't punished.


Sprague said that may be because there are too many taxis on the streets for police to enforce the rules, especially after the early morning bar rush when officers have their hands full with more serious crimes.

The increased competition has made it harder for taxi companies to make ends meet, Dodd said, which is why Lucky Seven wants a fare hike.

But Dodd said Uber is not as great a factor as its reputation threatens.

Dodd said Lucky Seven competes head-to-head with Uber after bar closing but not so much during the day, which is where most of its riders come from.

Though Uber's surge pricing, the higher fares charged during peak demand, annoys her and other taxi operators, she said she doesn't think that Lucky Seven would follow suit because that would annoy established customers who provide most of her business.

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