Ride-sharing service Lyft, known for the iconically ironic fuzzy pink mustaches that adorn its vehicles, has agreed to pay $300,000 to settle allegations from the New York Attorney General’s Office that it was operating illegally when it briefly jumped into the Rochester and Buffalo markets last year.When it first began operating in the area, local government raised concerns that it was operating in “open defiance of state and local licensing and insurance laws designed to protect the lives and well-being of New Yorkers,” according to the original complaint.

That included not requiring drivers to be commercially licensed, not following local for-hire licensing procedures, and not carrying adequate insurance (one recent survey found that 77% of cars inspected needed maintenance or repairs — and that kind of risk could be passed along to consumers).

At the time, the company negotiated a deal with the Attorney General’s office that would prevent it from operating in Rochester and Buffalo, but would allow it to operate in New York City.

By agreeing to the new settlement, which puts an end to the 2014 lawsuit, Lyft does not admit any wrongdoing.

In addition to paying the fine, Lyft will also be required to give three weeks’ notice to any municipalities where it intends to launch service and abide by all laws applying to for-hire vehicles. That will include auto insurance from state-authorized companies.

Ride-Sharing vs. Traditional Taxis

Ride-sharing has become a complex issue in recent years, with the rise of app-based services such as Lyft and Uber challenging traditional taxi services.

Lobbying groups for taxi drivers, unsurprisingly, tend to criticize ride-sharing platforms, saying they skirt regulations in order to offer lower fares. Flooding the market with these part-time drivers via ride-sharing apps will put full-time taxi drivers out of business, they claim.

But 20- and 30-somethings have embraced ride-sharing. The Rochester Young Professionals Group even held a rally this month to raise support for legislation that would allow Lyft and Uber to begin legally operating upstate.

RYP President Brad Flower told the Democrat and Chronicle pn June 11 that this is the first issue that has motivated the group to publicly organize around specific legislation. “It’s huge among our peer group,” he said.