New York Times: Your Uber Car Creates Congestion. Should You Pay a Fee to Ride?

By Winnie Hu

The sputtering traffic in Manhattan has long been blamed on cars and delivery
trucks pouring onto the streets from the rest of the city and beyond.

Since at least the 1970s, New York City officials have proposed various toll
systems to deter drivers from coming over bridges or piling into the busiest
neighborhoods.

But today, the traffic landscape in the city has undergone a remarkable shift —
the problem is not just the congestion coming in, but the congestion that is already
here. An explosion of ride-hailing app services has transformed the way that people
get around the city and is choking the streets. Midtown traffic crawls at an average of
4.7 miles per hour from 6.5 miles per hour five years ago.

“You’ll see an entire row of Lyft, Uber and Juno drivers on the streets waiting to
pick people up,” said Chanse Gierbolini, 27, a baker in Lower Manhattan. “It seems
like everybody’s driving the same black sedan — they’re everywhere.”

About 103,000 for-hire vehicles operate in the city, more than double the
roughly 47,000 in 2013, according to the Taxi and Limousine Commission. Of those,
68,000 are affiliated with ride-hailing app companies, including 65,000 with Uber.alone,
though they may also provide rides for others. In contrast, yellow taxis are capped by
city law at just under 13,600.

Now a new report finds that ride-hailing cars are often driving on the city’s busiest
streets with no passengers — in effect, creating congestion without any benefits. The
report by Bruce Schaller, a former city transportation official, found that more than a
third of ride-hailing cars and yellow taxis are empty at any given time during
weekdays in Manhattan’s main business district.

The ride-hailing cars average 11 minutes of unoccupied time — compared with
eight minutes for yellow taxis — in between dropping off one passenger and picking
up another, according to the report.

The ride-hailing services have drawn scrutiny as Gov. Andrew M. Cuomo
formulates a congestion pricing plan that would not only reduce traffic, but also raise
money to modernize the city’s subways. A state task force, called Fix NYC, is looking
at measures including a new per-ride fee on all for-hire vehicles in Manhattan, which
would be paid by passengers, according to those familiar with the discussions. Mr.
Cuomo is expected to announce a congestion pricing plan, which must be approved
by the State Legislature, as soon as January.

“The governor has been clear we need to reduce gridlock, cut emissions and
fund mass transit,’’ said Peter Ajemian, a spokesman for Mr. Cuomo, “which is why
he empaneled Fix NYC to explore all options.”

Mayor Michael R. Bloomberg was the last to try a congestion pricing plan, in 2008.
His plan, which would have exacted an $8 fee for entering Midtown and Lower
Manhattan, died in the State Assembly.

Across the nation, a handful of cities have imposed per-ride fees. Seattle, which
began regulating ride-hailing services in 2014, charges two fees totaling 24 cents per
ride to cover the costs of regulating and licensing operators and to support
wheelchair-accessible cars. Portland, Ore., began charging passengers a fee of 50
cents per ride in 2016 to pay for safety inspections of cars and other regulatory costs.

In Chicago, where Mayor Rahm Emanuel contends the ride-hailing services have
cost his city millions in lost taxes and fees, the city introduced a 20-cent-per ride
fee in 2014 and raised that to 50 cents the following year. The fee will rise to 65
cents next year, and then to 70 cents in 2019 — with the additional increases
dedicated solely to modernizing the transit system, city officials said.

New York City is considering a new fee on for-hire vehicles at a time when the
state-controlled Metropolitan Transportation Authority is in dire need of money to
overhaul the city’s decrepit subway system. Advocates say it would be easier to push
through the State Legislature than tolls on the East River bridges and already has a
precedent: a 50-cent surcharge on cab rides that goes to the transportation
authority. The ride-hailing services are not subject to that surcharge, but collect state
and local sales taxes on each ride.

Mayor Bill de Blasio has criticized Uber’s rapid expansion for exacerbating
traffic, but his administration backed down from a proposed cap on Uber cars in
2015. The mayor, who opposes congestion pricing, has announced his own plan to
reduce traffic, including banning some truck deliveries and stepping up enforcement
of traffic rules.

In the meantime, there is no escape from gridlocked streets. Jennifer Brown, 46,
an architect, was recently trapped in a cab on Fifth Avenue near 72nd Street en route
to an appointment. After going two blocks in 20 minutes, she finally jumped out to
walk to a subway station. “I was late, so it was anxiety inducing,” she said.

Alexis Licairac, 47, a law firm clerk in Lower Manhattan, said it takes him about
two hours to get to work by bus from his home in the Bronx. “It’s absolutely
horrible,” he said. “When I see how bad the congestion is in the city, I think if there’s
a disaster, we’d never get out.”

Sam Schwartz, a former city traffic commissioner who is on the state task force,
said that a new ride fee could compel some passengers to seek cheaper alternatives,
including subways and buses. He said that growing car congestion has hurt the city
economy at all levels, from making it harder to get to work to increasing delivery
costs for stores and restaurants.

Alix Anfang, an Uber spokeswoman, said simply adding a fee would not address
an already unfair fee system in which Uber riders pay more in sales tax than taxi
riders pay with the 50-cent M.T.A. fee. The minimum fare for an individual Uber
ride in New York City is $8, which amounts to a sales tax of 71 cents. She said the
system is especially a burden on riders outside Manhattan, who have fewer subway
and bus options.

This week, Uber started a campaign calling for a comprehensive approach to
congestion pricing, which could include a per-ride fee in Manhattan among other
measures.

“The existing ride-hailing tax unfairly burdens outer borough New Yorkers who pay
far more in taxes per trip than Manhattan taxi riders,” Ms. Anfang said, “which is
why Uber believes a new transit tax system should fully fund mass transit by setting
fees based on how crowded the roads are, not the type of vehicle people are traveling
in.”

Campbell Matthews, a Lyft spokeswoman, said the company has focused on
increasing occupancy in cars on the road and reducing individual car ownership.
“We are supportive of holistic efforts to address congestion in New York to ensure
that all transit options available to New Yorkers are convenient and affordable,” she
said.

Drivers for ride-hailing services and cabs said they would oppose a new ride fee,
arguing that they, too, are hurt by congestion and that such a fee would unfairly
single them out when there were other causes, such as construction, garbage pickups
and truck deliveries.

Mohammed Zzaman, who drives for Uber, Lyft and Juno, said he made fewer
pickups and less money during his “hell month” in December, when holiday crowds
descend on the city and it takes twice as long to cross Midtown.

George Vountouvas, 60, an Uber driver, said he started at 4:30 a.m. because
“there’s no congestion, no traffic at that time.”

Nino Hervias, a taxi owner and spokesman for the Taxi Medallion Owner Driver
Association, said the hefty prices for taxi medallions should already include access to
Manhattan streets, though he supported a new fee for ride-hailing cars.

While Uber, Lyft and Via have expanded their services outside Manhattan, Mr.
Schaller found that for-hire vehicles continued to crowd into Manhattan’s main
business district. There were an average of 10,500 yellow cabs and vehicles working
for ride-hailing apps from 4 p.m. to 6 p.m., or more than double the 5,100 vehicles in
2013. “It’s very easy to get a ride when you want one, but once you get in the car,
you’re stuck in traffic,” he said.

Mr. Schaller has called for reducing the unoccupied time for ride-hailing cars
and yellow taxis in addition to other efforts to reduce congestion, such as a new ride
fee or toll system. He noted that Uber already uses technology at the airports to
“rematch” cars dropping off passengers with new pickups to reduce congestion — a
practice that could be expanded to city streets.

Many riders said something had to be done about congestion, but were wary of
another fee. “We already pay taxes — what more do they want from us?” said Evelyn
Jimenez, 38, a dental assistant who already spends at least $15 a day on Uber.

But Mr. Gierbolini, the baker, said that he would be willing to pay a little more
since he still depends on the subway to get to work. He spends $25 a week on Lyft,
but only when he is not under pressure to be someplace on time.

“There’s almost no reliable way to get anywhere on time other than walking,” he
said.

Copyright 2017 The New York Times Company.  All rights reserved.

ProPublica reports on bankruptcy fraud in LA

ProPublica just posted a fascinating piece on bankruptcy fraud in the Central District of California (which includes Los Angeles).  It's the latest article in their important series "Too Broke for Bankruptcy: How Bankruptcy Fails Those Who Need It Most."

San Francisco taxi medallion owners "underwater" like NYC

As you may know if you’ve been keeping up with our work, we’ve been focusing on the trials and tribulations of NYC taxi medallion owners.  Now HotAir reports (based on a CBS San Francisco story) that San Francisco taxi medallion owners are facing the same issues of “underwater” medallions due to competition with Uber and Lyft, with its own unique local angle.  It’s far from a San Francisco treat for medallion owners.

NYC taxi medallion auction update

MEDALLION AUCTION UPDATE:

Crain’s New York Business reports that Aspire Federal Credit Union will be holding an auction of 14 New York City taxi medallions on Jan. 16, 2018.  To attract bidders, at least one of the medallions will have an opening price of $150,000.  The article notes that the last major auction that involved competitive bidding was a package of 46 medallions sold in September for about $186,000 apiece.  For updates on this auction and further developments in the taxi medallion industry, please keep reading our blog.

Taxi Limousine Commission (TLC) Medallion Sales Data from November 2017

Provided below is sales data from the sale of 14 taxi medallions as reported by the TLC for November 2017. The foreclosure sales prices for the two medallion sales at $750,000 are the result of foreclosure sales and those prices may be inflated because the banks “credit bid” at those foreclosure sales (they bid up to the amount of their loan balances); therefore, they may not accurately reflect the fair market value of a taxi medallion. Similarly, the estate sale at $150,000 may be too low a value because these sales reflect a sale by the estate of a taxi medallion owner who died, and those may “desperate sellers.” Medallion owners with “underwater” medallions (where the loan balance exceeds the value of the medallion) should contact Jim Shenwick to discuss their options under the law.

Price	Type of Sale	Number of Medallions
$750,000	Foreclosure	2
$750,000	Foreclosure	2
$400,000		1
$350,000		2
$350,000		2
$250,000		1
$190,874.15	Partnership Split	1
$150,000	Estate	1
$150,000		1
$0	Estate	1