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San Francisco Sues California Over Ride-Hailing Licenses

SAN FRANCISCO (CBS/AP) — San Francisco is suing California over a state law that allows Uber and Lyft drivers to have a single business license to drive anywhere in the state.

City Attorney Dennis Herrera says the law prevents San Francisco from requiring drivers who live outside the city to obtain a local business license when driving in the city. Herrera says that deprives the city of money that could be used to offset maintenance and traffic costs from the large number of out-of-town drivers.

The city filed the lawsuit on Thursday in state court.

Herrera says nearly every other business owner who operates in San Francisco is required to obtain a local license.

John Cote with the San Francisco City Attorney's Office said, "This is about everyone playing by the same set of rules, including Uber and Lyft."

While it may have been filed against the state of California, the lawsuit actually drives right into the ride-hailing industry, claiming that Senate Bill 182 has allowed Uber and Lyft to usurp San Francisco's authority to regulate its own affairs.

"What that state law does is it carves out an exemption for Uber and Lyft drivers. It exempts them from local business registration and tax purposes," Cote said.

Jose Cisneros, the treasurer of the City & County of San Francisco said, "Right now we have a law that says every business that operates in the city has to register with the city and pay a tax."

In a sweeping statement announcing his action Thursday, City Attorney Dennis Herrera pointed to a long list of now-familiar complaints, everything from clogged streets to dangerous driving. So why the very narrow scope of this lawsuit?

Cote said, "We're focused on a bill that just took effect in January. Certainly there have been a lot of discussions by policy makers about how to manage all of this, but we're just focused on one specific aspect of that, the companies - Uber & Lyft - creating a carve out for their drivers."

San Francisco has complained that out-of-city drivers are wreaking havoc on traffic and now it looks like the city has found a way to take at least that part of the issue to court.

The law was passed last year. The office of the state senator who authored it did not immediately have comment.

© Copyright 2018 CBS Broadcasting Inc. All Rights Reserved. The Associated Press contributed to this report.

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