New York City taxi drivers and their advocates are experiencing sticker shock over a significant fare hike set to take effect in much of the city, which they fear will spell doom for the already struggling industry.
Starting in January, it will cost $5.80 just to start a trip in a yellow cab in most of Manhattan, thanks to a $2.50 "congestion fee" included in the budget passed by the state legislature in April. That new charge will affect for-hire vehicles that touch a congestion zone below 96th Street, and comes on top of an existing $2.50 pick-up fee and 80-cent accessibility and mass transit charge levied on yellow taxis. Taken together, the fees represent a "potentially devastating" threat to the cab industry, according to Taxi & Limousine Commission Chairwoman Meera Joshi.
App-based services like Uber and Lyft also face a new fee—$2.75 for single rides and 75 cents for pooled trips in the same zone. But they will feel less of an impact, Joshi told the Wall Street Journal, because "they're not bound to a metered fare" and "can reduce the price of the trip so that the passenger doesn’t feel the effect." A spokesperson for Uber disputed that characterization, noting that the state law requires the fee "be passed along to passengers.”
According to Uber drivers who spoke to Gothamist anonymously, there are rumors swirling that the company is preparing to institute a major fare increase in New York City in the coming weeks—and widespread confusion about whether the hike will impact their wages. A study conducted last year by Uber and New York University found that the take home pay of drivers is essentially unaffected by fare changes, due to the ease that drivers and customers can exit or enter the system.
But yellow cab drivers, who face a more stringent regulatory environment and plummeting values for their required medallions, do not have the same luxury. They say that the city's long delay in regulating the e-hail industry has made it nearly impossible for them to earn a living, and contributed to an ongoing suicide crisis. Last week, Queens-based cabbie Roy Kim became the eighth professional driver to take his own life in the past year, after he reportedly racked up more than $500,000 in debt on his medallion purchase.
According to the New York Taxi Workers Alliance, the congestion fee will dramatically exacerbate this crisis, and could cost yellow cab drivers as much as $15,000 a year in income. "The state and the city need to understand that the once stable path to middle class earnings for yellow cab drivers has been destroyed by uneven competition," NYTWA Executive Director Bhairavi Desai said in a statement. "Now is the time to stabilize income for this workforce, not to sink workers deeper into poverty and despair."
Asked about the reaction to the fee, a spokesperson for Governor Andrew Cuomo, Tyrone Stevens, called the charge a "first step" toward congestion pricing, and noted the money would go toward the MTA's Subway Action Plan. "Next year," he added, "we will continue to work with the Legislature to evaluate this surcharge and pass comprehensive congestion pricing once and for all."
When the taxi surcharge appeared in the budget earlier this year, City Councilmember Brad Lander told Politico, "I still see nothing approaching a serious effort to fix [the subway system]. Everyone seems to think the scale of what’s required... is at an order of magnitude higher than what we’re spending.”