ST. PAUL, Minn. (AP) — Uber and Lyft plan to keep operating in Minnesota after the state Legislature passed a compromise driver pay package, the companies said Monday.

The House passed the compensation bill but the measure was held up in the Senate before winning approval prior to the midnight Sunday deadline for lawmakers to pass bills before they adjourned. The bill now moves to Gov. Tim Walz to be signed into law, the Star Tribune reported.

The proposal was crafted by Democrats to replace a minimum pay measure the Minneapolis City Council passed that prompted Uber and Lyft to threaten to leave the state’s biggest city and the entire state.

The House agreement announced Saturday after weeks of negotiations would set a minimum pay rate at $1.28 per mile and 31 cents per minute. Uber and Lyft say they will keep operating in the state under those rates. The bill will take effect next January.

“While the coming price increases may hurt riders and drivers alike, we will be able to continue to operate across the State under the compromise brokered by the Governor,” Uber spokesperson Josh Gold said in a statement.

Lyft said in a statement that Twin Cities rideshare drivers were already earning higher than the national median, something drivers have disputed, saying many earn less than the minimum wage. Lyft said the legislation balances “a new pay increase for drivers with what riders can afford to pay and preserve the service.”

The city’s plan that raised objections from the companies would have required them to pay drivers at least $1.40 per mile and 51 cents per minute — or $5 per ride, whichever is greater — excluding tips, for the time spent transporting passengers in Minneapolis.

Marianna Brown, vice president of the Minnesota Uber/Lyft Drivers Association, told the Star Tribune that even though the pay rates are lower than drivers sought, they were happy to see the deal come together.

The governor said in a post on social media platform X that the deal “gives rideshare drivers a 20% raise and keeps these important services operating in Minnesota.”

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