FOR IMMEDIATE RELEASE
Monday, November 19, 2018  

Contact: Eliza Bates, elizamargarita@gmail.com, media@nytwa.org, 646.285.8491

NYTWA Calls on City Council to Exempt Yellow Cabs from Congestion Pricing 

Failure to Act will lead to more Bankruptcies and Homelessness Among Drivers 

Eight drivers pushed to suicide by financial despair in the past year
 
Drivers from every sector, yellow cab, black car, livery and Uber drivers themselves are facing foreclosures, bankruptcies and homelessness at an unprecedented rate

 
(New York, NY) After eight drivers were pushed to suicide by financial devastation in the past year, the New York Taxi Workers Alliance is calling on City Council to intervene to exempt yellow cabs from congestion pricing. Four of the eight suicides in the past year were yellow cab drivers, three of whom had been sunk into poverty after purchasing their own medallions - once a sure route to a middle class income. Among them was yellow taxi owner-driver Roy Kim, the most recent driver to die by suicide. 


Statement from NYTWA Executive Director Bhairavi Desai:

The City Council and Mayor must step in and defend yellow cab drivers who are already facing unprecedented devastation and could lose as much as $15,000 in income if they are not exempted from congestion pricing. 
 
Congestion pricing on the backs of New York City's struggling drivers would be one more case of shamelessly stealing from the poor, from people who have nothing left to give. 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. Now is the time to stabilize income for this workforce, not to sink workers deeper into poverty and despair.  
 
When Albany passed the congestion pricing measure in March, four drivers had taken their own lives due to financial devastation.  It was a heartless and cruel attack by Albany to pass the surcharge.  Today, the number has risen to eight suicides, among them four yellow cab drivers.  

Yellow cabs have already contributed close to $1 billion toward the MTA since 2009. Meanwhile, Uber and its cohorts are getting a break on surcharges for the same pool trips that have driven down MTA ridership.  
 
Albany is crushing a sector and workforce that has contributed to MTA funding all these years, while rewarding a business model that is directly trying to gut MTA ridership and is directly responsible for the congestion choking our streets. Once again Albany is letting Wall-Street bankrolled companies write the laws, while we bury drivers dead from financial despair. 

In 2009, when the 50 cent MTA surcharge was passed for yellow cabs, the livery sector was exempt because of the financial hardship it would create for a small business sector.  Why would that consideration not be given to the yellow cab sector now in crisis?  


We call on the City Council to intervene with a home rule message, demanding the state to delay implementation in order address the devastation Congestion Pricing would have on the yellow cab sector.    

 
Background:

The surcharge will create a deeper poverty among drivers who are facing the harshest economic conditions we have ever seen. There have been eight driver suicides in the past year, all due to despair from their deepening poverty.
  • Adding a surcharge will reduce ridership.  In fact, that is the stated goal of the surcharge.  Reducing driver fares will be crushing.
  • Drivers will also lose on vital tip earnings when riders skim on tipping to make up for higher fares.
  • It will be impossible to raise the metered fare in order to give a raise to drivers in desperate need of higher earnings.  The surcharge will have a crushing impact on driver incomes for years to come. 
Yellow and green taxis have been paying their fair share to the MTA for years.  
  • Yellow cabs have contributed close to $1 billion toward the MTA since 2009.  
  • Yellow and green cabs are already required to pay a $0.50 surcharge per fare that is earmarked for the MTA.
  • In 2015 alone, it was estimated that yellow cabs contributed $94 million to the MTA through the $0.50 surcharge. 
  • On top of the existing surcharge, yellow cab lease drivers pay a sales tax of $4.77 per shift on the vehicle lease which is also earmarked for the MTA.
  • DRIVERS themselves have subsidized the $1 billion - paying the full amount even when the passenger pays by credit or debit card and the driver loses 5% on the transaction and paying for gasoline, and maintenance of the car.
     
Uber, Lyft & co. have been responsible for the drop in MTA revenue and congestion.  
 
  • While yellow and green cabs pay the $0.50 surcharge, Uber and Lyft only pay sales tax, of which ⅜ of 1% goes to the MTA. 
  • In one day, a double-shifted taxi that makes 25 trips per shift collects $34.54 in tax revenue, of which $27.40 directly funds the MTA. One the other hand, in one day of full-time work, an Uber car may bring in $20 in general sales tax, handing over only $0.75 to the MTA.
  • Uber and Lyft meanwhile have targeted MTA passengers, further undercutting mass transit revenue.
  • Uber, Lyft and other App-based dispatch companies operate a business model that depends on saturating the streets with vehicles so they can be the first to monopolize. 
  • Uber alone has 68,000 affiliated vehicles.  Of the 13,500 taxis licensed in NYC, less than 10,000 are operational as bankruptcies and foreclosures spread.
 
Instead of holding them accountable, Albany is rewarding them. 
 
  • Given Uber, Lyft and co. subsidize fares to charge riders at below-cost - and that's despite having less than half the costs of regulated taxis - and because they operate group trips, the companies know a surcharge will not have the same effect on their ridership.  These companies are also new entrants into the market, unlike regulated taxis which have expenses prior to their entry and are going through a crisis.
  • Any further loss of revenue would devastate the taxi industry, giving Uber and Lyft a higher chance at monopolization.
  • Until May 2017, Uber profitted off the sales tax by charging its commission on the tax amount.  Uber also passed the cost of the tax onto the drivers, rather than adding it to the passenger's fare.  For years, a tax obligation was turned into a windfall for Uber.  Any congestion pricing charges in the FHV industry should not be passed onto the drivers and must come with strict enforcement against wage theft
  • Uber has spent $100,000 lobbying for a version of CP that would give it an advantage against both taxi, livery and black car competitors, as well as against the MTA itself. Albany, once again, got bought by Wall Street. 



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Founded in 1998, the New York Taxi Workers Alliance (NYTWA) is the 19,000-member strong union of NYC taxicab drivers, representing yellow cab drivers, green car, and black car drivers, including drivers for Uber and Lyft. We fight for justice, rights, respect and dignity for the over 50,000 licensed men and women who often labor 12 hour shifts with little pay and few protections in the city's mobile sweatshop. Our members come from every community, garage, and neighborhood. To find out more visit NYTWA.org, follow us on twitter.com/nytwa or like us on facebook.com/nytwa .
 


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