Nashville Repeals $45 Minimum Fare Law
Nashville, Tenn.—In a major victory for Nashville’s transportation entrepreneurs and customers, the Metropolitan County Council voted 29-3 late yesterday to reduce the city’s $45 minimum price for limousine and sedan service to $9. The original law, passed in 2010, nearly doubled the price of car service in Nashville, driving small transportation businesses off the road and leaving their customers out in the cold. The change will go into effect immediately once Mayor Karl Dean signs it into law.
The change in the minimum fare follows a three-year legal battle over its constitutionality. A group of local transportation entrepreneurs and the Institute for Justice (IJ) filed a federal lawsuit in 2011, pointing out that the law was literally written by Nashville’s most expensive limousine companies and designed to destroy their affordable competition. The case came to a dramatic conclusion in January 2013, when a jury upheld the law.
“The $45 minimum fare almost destroyed my business,” said Ali Bokhari, a plaintiff in the lawsuit and owner of Metro Livery, a popular car service that charged as little as $25 for trips between downtown Nashville and the airport before the minimum fare went into effect. “We have fought to repeal the minimum fare every day since it passed. After years of struggle, we are pleased to have regained the basic right to charge our customers a reasonable price.”
“Today’s decision is a victory for consumers, entrepreneurs and basic common sense,” said IJ Attorney Wesley Hottot, the lead lawyer in the case against the minimum fare, “but it should not have taken more than three years and a federal lawsuit for Nashville officials to recognize that consumers do not need the government’s protection from prices that are too low, any more than they need the government’s protection from pillows that are too soft.”
The change was prompted by the Nashville Convention and Visitors Bureau (CVB) over concerns that there are now too few private transportation options to meet visitors’ needs. Less than a year ago, however, the CVB helped defend the minimum fare in court, arguing that it was essential to draw more visitors to the city.
“Unsurprisingly, a law that was written by the city’s expensive limo companies turned out to be no good for anybody except the expensive limo companies,” explained IJ Senior Attorney Robert McNamara. “Nashville’s minimum fare was not the only law of its kind and we are committed to seeing similar laws join Nashville’s where they belong: off the books.”
The Institute for Justice is currently challenging the constitutionality of similar minimum-fare laws in Portland, Ore., and Tampa, Fla.