Arlington, Va.—On Monday, April 22, 2013, the Colorado Supreme Court issued a unanimous ruling in favor of Mile High Cab, which has been fighting a years-long battle with the state’s Public Utilities Commission over the company’s efforts to provide low-cost, high-quality taxi service in Denver. The PUC refused to grant the company a “certificate of public convenience and necessity,” which the state requires before taxi businesses can operate in Denver. Although the PUC found that Mile High was both operationally and financially fit to operate as a taxi business, it denied the application because it was unsure whether additional taxi services were needed in the city.
“As the Colorado Supreme Court recognized today, Colorado law does not allow the PUC to shut new taxi businesses out of Denver just because the commissioners are uncertain whether the business is ‘necessary,’” explained Robert McNamara, a senior attorney with the Institute for Justice, which represented Mile High and litigates for taxi freedom nationwide. “The people of Denver don’t need a government agency deciding whether they have too many transportation options any more than they need a government agency deciding whether the city has too many restaurants or shoe stores.”
The court’s ruling today found that the PUC had disregarded a statute passed in 2008 that only allow it to deny a taxi application as “unnecessary” if the evidence shows that the company “actually would be detrimental to the public interest.” Because the PUC’s decision lacked “the required level of certainty, or predictability, concerning the public convenience, necessity, and interest, [it] was statutorily obligated to issue the certificate.”
“The 2008 amendments were a big step forward for taxi freedom in Colorado and part of a nationwide trend toward reducing barriers to entry in the transportation industry,” said McNamara. “Today’s decision just makes the wave of taxi freedom that much larger.”
In addition to statutory reforms like Colorado’s, there is a growing trend of judicial engagement as courts nationwide strike down or rein in restrictive taxi regulations. Today’s ruling in favor of Mile High comes on the heels of a Wisconsin court ruling this past Wednesday, April 17, which struck down Milwaukee’s restrictive taxi permit system.
For Mile High, which first filed its application in September 2008, however, the victory comes not a moment too soon.
“We have been fighting for more than 1,600 days just for the government’s permission to start a business,” said Mile High Treasurer Mekonnen Gizaw. “Today’s victory is a long-awaited relief.”
“Starting a taxi business is an excellent way for a would-be entrepreneur to get started: It doesn’t take much capital, and it doesn’t take much formal education,” IJ President and General Counsel Chip Mellor said. “Today’s ruling has a message for the PUC that should be heard by regulators nationwide: When it comes to taxi regulation, just get out of the way.”
Prof. Thomas D. Russell, J.D., Ph.D. represented Mile High Cab before the Public Utilities Commission and serves as local counsel.