Uber and Lyft are facing a major crackdown in New York City

Uber and Lyft are facing a major crackdown in New York City

July 27, 2018 0 By Nazmul Khan

New York City officials are moving to restrict the number of Uber and Lyft vehicles allowed on the road as part of a move to contain the massive growth in the for-hire vehicle industry that has been blamed for worsening congestion and low wages for drivers.

The legislation that’s being considered by the City Council would make New York City one of the first cities to cap the number of ride-hail vehicles on its streets, according to the New York Times. Council Speaker Corey Johnson, a Manhattan Democrat, supports the measure, while Mayor Bill de Blasio has voice support for new rules for ride-hail companies. De Blasio proposed his own attempt to cap Uber and Lyft vehicles in 2015, but eventually dropped it after a bruising battle with the app companies. The City Council could vote on the measures as soon as August 8th, the Times says.

There’s a package of bills under consideration. One would freeze new for-hire vehicle licenses for 12 months while the city’s Taxi and Limousine Commission studies “utilization, congestion, driver income, and neighborhood service. Another would create a new category and licensing framework for Lyft and Uber, in which the city could limit future permits by geography and potentially decline to renew a permit if a “need” for the service isn’t demonstrated.

For their part, Uber and Lyft are portraying the cap as an attack on outer-borough residents, especially minorities, who lack access to public transit and are often passed over by yellow cabs. It is almost identical to the argument presented by these companies three years ago. On Thursday, as officials began discussing the proposal, Uber quickly released an ad that depicted available vehicles disappearing from its app as a result of the cap.

“The City Council’s Uber cap will leave New Yorkers stranded while doing nothing to prevent congestion, fix the subways and help struggling taxi medallion owners,” said a spokesman for Uber. “The Council’s cap will hurt riders outside Manhattan who have come to rely on Uber because their communities have long been ignored by yellow taxis and do not have reliable access to public transit.” A spokesperson for Lyft added, “This would take New York back to an era of standing on the corner and hoping to get a ride.”

The explosion of ride-hail vehicles in New York City, while wildly popular among riders, has been a source of almost constant strife for policymakers, disability advocates, taxi medallion holders, and driver groups. They complain that Uber and Lyft have been allowed to dominate the market without having to follow many of the same rules that apply to taxis. This has led to a glut of drivers that has outstripped demand, driving down wages and increasing traffic congestion.

Taxi medallion owners have seen the value of their licenses drop steadily since Uber’s arrival. Saddled with debt, some taxis drivers have committed suicide — six in as many months. Council members are also considering a bill that would set minimum pay rules for app drivers.

The number of new vehicles on the road has surged since the last time a cap was up for debate, growing from 63,000 in 2015 to over 100,000 today. These new vehicles have added an unprecedented number of new miles driven in New York City, according to a recent analysis by traffic analyst Bruce Schaller. Trip volumes have tripled in the last year and a half and 600 million of driving miles were added citywide. In addition, Schaller found evidence that ridership was shifting from public transportation to ride-hailing apps.

The Council thinks a vehicle cap is the way to go, but not all groups agree. The Independent Drivers Guild, which represents Uber and Lyft drivers, has called for a cap on new drivers rather than a limit on vehicles. “Limiting new TLC drivers will mean fewer cars on the street and more work per hour for current drivers — [for-hire vehicle] and taxi drivers alike,” the group says. “What’s more, a limited pool of drivers will force apps and taxi bosses to compete for drivers, which could mean better pay, better policies and app improvements.”

Some experts suggest that the best way to regulate the growth in app vehicles is not a cap, but congestion pricing that would charge vehicles to enter the most congested parts of Manhattan. That money could then be used to improve subway and bus service, which could attract riders back to transit and create a better balance in the city.

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