It should come as no surprise that the Metropolitan Transportation Authority (MTA) is moving forward with Congestion Pricing. We knew it was coming, it was just a matter of how devastating it would turn out for drivers licensed by NYC’s Taxi & Limousine Commission (TLC). When we went to press in late May, the finer points of the plan had yet to be determined, but we at least found out that TLC-licensed drivers will not have to pay $23 every time they enter Manhattan below 60th Street – which seemed like the worst of all possible scenarios. (Drivers also will not be charged if they remain on the FDR Drive or West Side Highway.)
The new worst-case scenario is slightly better, but still deeply concerning: Drivers could be forced to pay up to $23 per day, if they enter the city’s Central Business District during peak hours (overnight tolls are expected to be at least 50% lower). Of course, better is better, but that is still excessive, potentially creating unnecessary – and significant – accounting issues. This is particularly true for drivers who accept jobs from multiple bases… but also for companies that provide work to drivers who accept jobs from multiple bases.
“[Congestion Pricing] is only approximately one year away from becoming a reality,” noted David Eckstein, co-owner of Valera Global, in an email to Black Car News. “It will be interesting to see how everyone deals with clients, and even affiliates. One vehicle might only go into the central business district once a day and some might go in several times. How do you split up the charges? Will buses pay a higher rate? Will they charge delivery trucks higher rates, creating more inflation pass-throughs? This is going to be an accounting nightmare!”
It’s always frustrating when “answers” lead to more questions, and this is one of those situations. The solution that I think makes the most sense mirrors what Ira Goldstein, advisor for the Black Car Assistance, said in his column this month (on page 5). Mr. Goldstein expressed his concern the fee would devastate TLC-licensed drivers. A typical FHV trip receipt already has a laundry list of surcharges, but a much smaller, per-trip fee, paid directly by passengers, would be a BETTER alternative than (potentially) $23/day. Much better.
“The exact toll prices are yet to be determined, but the MTA is considering seven scenarios ranging from $5 to $23, with variations based on vehicle type and time of day,” Mr. Goldstein said. “We will continue to advocate for the surcharge to be issued on a per-trip basis, rather than once per day so that the burden doesn’t fall on drivers. We want to see the surcharge kept as low as possible and applied equally throughout the ground transportation sector. Ultimately, when there is a final decision, we may need to explore our legal options.”
In his column this month on page 28, TLC Chair David Do added an important point: “As we all know, since 2019 TLC vehicles have already been paying surcharges on trips that start, end, or pass through the zone south of 96th Street. This has amounted to well over a billion dollars. And while it comes as a relief that TLC vehicles won’t be paying every darn time they move into the zone, we will be watching the MTA board very closely as they approach a final decision. It is my hope that the outcome actually benefits our industry.”
I get that the MTA wants to plug the stadium-sized hole in its budget, but forcing people who have already been paying their fair share for years now to pay what could easily amount to an additional $100-150 per week is beyond excessive. So now, the clock is truly ticking. It will take the MTA at least another 300 days to launch the tolls, requiring the installation of tolling infrastructure and E-ZPass readers, but that day will be here before we know it – and the effect a project this massive might have on a city so large and crowded also remains a giant question.
The draft environmental assessment released in August 2022 projected that tolls could reduce demand for taxis by up to 17% within the congestion zone, potentially pushing TLC drivers out of a job. Brendan Sexton, president of the Independent Drivers Guild told amNY the plan would unfairly “double tax” commercial drivers: “It is unfair to add another congestion tax on these drivers – and it also violates federal law by disproportionately harming minority and low-income populations. To double tax those who can least afford it is obscene and puts the livelihood of thousands of low-income, immigrant rideshare drivers in jeopardy. The MTA should leave the status quo in place for the drivers, and reassess in a few years.”
Agreed, Mr. Sexton. Now, we wait and see…
I would like to apologize if our piece last month, titled “Airport Access Fee Increased,” was unclear. It is not a new fee; it is an increase in the fee the Port Authority was already charging on every taxicab pick-up trip and every for-hire vehicle pick-up and drop-off trip at LaGuardia Airport and John F. Kennedy International Airport. According to the TLC, “After a delay due to the coronavirus pandemic, the initial access fee at the rate of $1.25 went into effect on April 5, 2021. On April 5, 2023, the Port Authority increased the amount passengers in TLC-licensed taxis pay at LaGuardia and John F. Kennedy Airports to $1.75.”