Uber Announces Price Hike In NYC As Congestion Pricing Surcharge Moves Forward

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A New York State judge lifted a temporary restraining order that had blocked the state's congestion pricing surcharge from going into effect on January 1st.

In her order, Judge Lynn Kotler found that the surcharge would not cause “irreparable injury” to driver’s business, since the charge is passed on to passengers.

Now, Uber says riders can expect prices to go up, although the company didn’t say how much more. It did note that for the average UberX ride, which costs $22, 20 percent of that will go to taxes.

The state expects the congestion pricing fee will generate $1 million a day, which is expected to go only to the MTA. Medallion owners would charge riders in Manhattan below 96th Street $2.50, all other for hire vehicles, would charge $2.75. Car pooled rides would only charge an extra .75 cents.

Uber's announcement comes in response to Thursday’s ruling, and the city’s minimum payment requirement for app based drivers, which was expected to go into effect Friday, but is also the subject of a lawsuit from Juno and Lyft (although notably, not Uber). Uber will comply with the new wage requirements.

[UPDATE: 1:10 p.m.: After a modest social media campaign, Lyft announced Friday afternoon it will pay drivers the new minimum wage. "This TRO victory acknowledges that Uber was handed a sweetheart deal by the TLC that would irreparably harm Lyft. Drivers shouldn’t suffer while we work to right the TLC’s mistakes so we are immediately raising driver pay as we continue our fight in court," Lyft spokesperson Campbell Matthews wrote in a statement.]

On Thursday Judge Kotler also dismissed the state’s request to throw out the case entirely, which means the lawsuit will still move forward.

"We're calling on the governor not to move forward with fees that will force drivers to choose between food and medicine,” New York Taxi Worker Alliance Executive Director Bhairavi Desai wrote in a statement. “That is how dire the poverty is now among this workforce that has lost eight of our brothers to suicide in less than a year.”

She added that if the state implements the surcharge and ultimately loses, it’ll be responsible for figuring out how to refund riders, including those who paid cash.

A spokesman for the Taxi and Limousine Commission declined to comment. The outgoing head of the TLC Meera Joshi is critical of the fee.

“We’ll cooperate with the state as necessary to implement the surcharge and follow the legal case as it develops,” Nick Paolucci spokesman for the City Law Department wrote in a statement. “The City supports this important measure which will help open up our roadways, reduce pollution and generate millions in revenue for our subways.”

Asked about the Juno and Lyft lawsuit on the Brian Lehrer Show this morning, Mayor Bill de Blasio said, "I can't believe these huge companies literally have the gall to sue the city of New York because we're trying to raise wage levels." In regards to the congestion pricing surcharge, and the potential impact on ride hail companies like Uber, de Blasio said, "There's a very strong market for For Hire Vehicles and yellow cabs, and this surcharge isn't going to fundamentally change that market."

This fee was pitched to the state legislature as a way to raise money for the MTA and begin addressing congestion in Manhattan. But Charles Komanoff, who was on the governor's congestion pricing task force, doubts there'll be a noticeable impact on congestion from this fee.

The congestion surcharge will go into effect Saturday at 12:01 a.m., according to the state Department of Taxation and Finance.

Stephen Nessen is the transportation reporter for WNYC. You can follow him on Twitter @s_nessen.

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