A Manhattan state judge on Wednesday ordered New York City to stop issuing new licenses to for-hire vehicles, throwing a wrench into Mayor Eric Adams’ plan to allow companies like Uber and Lyft to put more cars on the street as long as they’re fully electric.
The temporary restraining order goes into effect on Monday at 9 a.m.
The ruling comes in a lawsuit brought last week by the New York Taxi Workers Alliance, which represents yellow taxi medallion owners and drivers, against the city's Taxi and Limousine Commission. The suit argues that Adams’ new rule opens the floodgates to Ubers and Lyfts on city streets and unfairly harms yellow taxi drivers.
“Our end goal here is to create a proper standard to measure how new plates can be released, how they must be limited to drivers, and to ensure that the TLC does its job and regulates the predatory leasing and financing in this industry,” TWA Executive Director Bhairavi Desai said at a press conference on Thursday. “It's not too late for the TLC to set this right.”
Adams touted the rule change last month, saying it would help make the city's entire taxi and for-hire vehicle fleet fully electric by 2030.
But the plan has raised concerns among traffic experts, who feared more cars on the streets would undermine the MTA’s goal to reduce gridlock in Manhattan through congestion pricing. The first-in-the-nation tolling program for drivers is expected to go into effect below 60th Street next year.
Taxi drivers have said the lifting of the cap for electric for-hire vehicles is a blow to their business. The cap was put in place in 2018, following several suicides by cash-strapped taxi medallion owners. By then, Uber and Lyft deployed more than 70,000 cars on the streets.
The TLC reported that as of Wednesday, there were 1,746 applications for new electric for-hire vehicle licenses and more than 90% of those drivers already had a TLC driver's license.
Ryan Wanttaja, the TLC's first deputy commissioner, said in a statement the change would help drivers become for-hire vehicle owners instead of being forced to rent the vehicles from groups that already have operating licenses.
“Resuming the issuance of EV licenses not only promises long-term environmental benefits but also relief for drivers stuck in predatory leasing arrangements,” Wanttaja said. “A halt on this initiative is nothing short of a loss for drivers who dream of small business ownership in an environmentally friendly and sustainable way.”
Desai, the head of the TWA, acknowledged 70% of her union’s roughly 28,000 members work for Uber and Lyft. Since last year, yellow taxis have been allowed to take ride-hail passengers through the app-based companies.
Desai said she supports lifting the city’s for-hire vehicle cap to allow existing drivers to obtain licenses for electric for-hire vehicles but fears the city’s rules are too broad and will lead the city to become saturated with for-hire cars.
