LOUISVILLE, Ky. (WHAS11) -- Neither of two ride-sharing companies which recently began operations in Kentucky have applied for a state license and Metro Louisville government is unsure whether they are subject to taxicab regulations. Like a taxi service, the businesses, Uber and Lyft, allow customers to book and purchase automobile transportation in exchange for a fare. Yet, the companies do not regard themselves as taxicab services. Instead, they describe themselves as "technology companies," in part because the paid rides are booked through apps on smartphones. "It's really just a platform for connecting people looking for rides with available drivers," said James Ondrey, Uber's General Manager for the Ohio Region. The president of Procarent, the parent company of Yellow Cab in Louisville, begs to differ, arguing that Uber and Lyft are skirting the law and regulations, potentially endangering the public." "Make them play by the rules just like we do," said Steve Coston, Procarent president. "And the rules are there for a good reason. They're not there to block out competition, they're there to ensure public safety." It's a key distinction. Taxi companies have to go through a rigorous and costly application process to first be licensed by the state, then adhere to some 35 pages of Louisville Metro's ground transportation ordinances. The city inspects and certifies each vehicle and requires police background checks of each driver. "The whole basis of that is for the health and safety of the community" explained Jim Mims, Metro Codes and Regulations Director. Ondrey said Uber takes care of those concerns on its own. "Any of the drivers who want to work on our system, they go through a very stringent background process before they have access to that system," Ondrey explained. "It involves a multi-state crininal database check, a federal background cehck, a county background check. We look at their motor vehicle history report, stuff like that before someone has access to the system." "We look at the vehicle and inspect it," Ondrey continued. "And there's some training involved." In addition, an Uber spokeswoman said the company has a "best-in-class insurance policy." "From the time a driver accepts a trip request through our app until the completion of the ride, our partners have $1 million of coverage for driver liability," said Lauren Altmin, "which is ten times higher than the requirement for taxi companies in Louisville." With no independent oversight of Uber's operations, however, Jim Mims, Louisville's Codes and Regulations Director, said Uber's customers need to take safeguards. "A consumer has to be aware what they're getting into relative to the ride," Mims said. "Make yourself aware." "After consulting with the county attorney we concluded we needed to study this a bit more," Mims said, explaining that the city's initial assessment is that the ground transportation ordinance does not adequately address transportation network companies. "It's not only a new company but a new concept," Mims said. The city may also lack jurisdiction because Uber has not applied to the Kentucky Transportation Cabinet for a license to operate. "This is the kind of thing the community wants," Mims said. "Now we have to figure out a way to make sure that they can be integrated into our ground transporation system in a... good and orderly fashion." Uber is not waiting for any legal determination, but gearing up for a big demand on Oaks and Derby Days. "The reason people love it is because it's super-reliable," Ondrey said, "it's convenient and the hassle free payments. You never need cash." Uber may need some cash - however. In March, it was fined $26,000 by the Commonwealth of Virginia for operating without a passenger carrier broker's license. Ride-sharing companies face similar legal challenges in Los Angeles, San Francisco, Detroit, Chicago, Atlanta and Columbus, Ohio. Louisville's top convention officicial says vistors should steer clear. "It's a service that we won't recommend to our clients necessarily because they are not regulated," said Karen Williams, Louisville Convention & Visitors Bureau President. On Thursday, Costen sent a letter to Kentucky Secretary of Transportation Mike Hancock, complaining that Uber and Lyft are "operating blatantly and illegally." Uber says it's the wave of the future. "You just hop in a vehicle," Ondrey said, "go where you need to go, hop out and you're automatically charged through the app." "I think there is a novelty to that," Coston said. "but I think there is also a public safety risk feature attached to that." Coston rejected Uber's distinction of itself as a technology company, pointing out that customers can hail a Yellow Cab via an app. "You can order a cab, a legitimate legal cab just as easily as you can one of these that are operating outside the law," Coston said.