Ride-sharing services Uber and Lyft are planning to shut down their operations in Austin, Texas beginning May 9 due to a vote that would continue to require fingerprint checks for drivers.
Uber and Lyft shared the expenses of a campaign that cost $8 million as the companies aimed to gather support for the passing of Proposition 1, a proposal that would exempt Uber and Lyft drivers from fingerprinting as part of their background checks.
The results of voting showed 56 percent opposed the proposal, blocking the implementation of Proposition 1.
According to Lyft, with the rejection of Proposition 1, it will be much harder for part-time drivers to operate under a ride-sharing company in the city.
The ceasing of operations of Lyft is what the company claims is its move to take a stand for the long-term growth of ride-sharing in the U.S.
Uber, on the other hand, claimed that disappointment does not begin to describe what the company feels regarding its planned closure in Austin, spurred by the rejection of Proposition 1.
However, Austin Mayor Steve Adler stated that the ride-sharing companies are very much welcome to continue their operations in the city, with Austin City Councilwoman Ann Kitchen adding that Uber and Lyft are not being asked to leave.
"We held the election they said they wanted. It's time to listen to the voters and for them to sit down with us," Kitchen said.
Both companies have long maintained that the background checks that they are implementing on their drivers are sufficient. In some instances, though, such as in Austin, municipal regulations dictate stricter laws for drivers who provide transportation services.
The outcome of the election on the proposal was closely monitored by other cities in the country as various local governments are deciding on the best way to regulate ride-sharing services.
Last month, San Francisco began requiring Uber and Lyft drivers to acquire a business license to be able to continue operations.
