Uber and Lyft are leaving Minneapolis over driver pay hikes

and plan to go out of business after the city council votes to increase driver pay. The council passed an ordinance on the matter last week. On Thursday, he voted to override the mayor’s veto of the measure.

The new rules require ride-sharing companies to pay drivers at least $1.40 per mile and 51 cents per minute (or $5 per trip, whichever is higher) when they carry a passenger. Tips are above minimum wage. According to the council passed an ordinance to bring driver pay closer to the local minimum wage of $15.57 an hour.

However, Uber and Lyft say they will end service in the city before the wage increase takes effect on May 1. Lyft says the increase is “deeply wrong,” citing Minnesota showing that drivers can meet the minimum wage and still cover health insurance, paid vacation and retirement savings at rates as low as $1.21 per mile and 49 cents per minute. “We maintain a minimum income standard for drivers, but it must be done in a fair way that keeps the service affordable for drivers,” said spokesman CJ Macklin

An Uber spokesperson told the publication that the company was disappointed by the council’s choice to “ignore the data and kick Uber out of the Twin Cities,” leaving about 10,000 drivers out of a job. They noted Uber’s confidence that by working with riders, drivers and lawmakers, “we can achieve comprehensive legislation across the country that guarantees drivers a fair minimum wage, protects their independence and keeps ridesharing affordable.”

However, Minnesota Gov. Tim Waltz m.y to raise wages for Uber and Lyft drivers, citing concerns that the state would become one of the most expensive places in the country to rideshare. Other jurisdictions have imposed minimum driver pay for ride-sharing services, including New York, where the rate starts at about $18 an hour.

If Uber and Lyft follow through on their threat to leave Minneapolis, it could make it harder for people to get around (especially people with disabilities and those who can’t afford their own cars). The rise of ride-sharing has upended the taxi industry over the past decade. As such, an employee of Minneapolis there are now just 39 licensed taxi drivers in the city, a significant drop from 1,948 licensed drivers in January 2014.

Meanwhile, some ride-sharing start-ups and took over from Lyft and Uber. and , for example, have expressed interest in starting operations in Minneapolis. Both companies require drivers to pay a monthly subscription fee to use their platforms and find riders. In return, the drivers keep the entire fare.