Congestion pricing fee lawsuit could cost MTA millions in revenue

In December, a judge issued a temporary restraining order on the congestion fee on taxi and other for-hire vehicle rides below 96th Street that was scheduled to go into effect on January 1. The lawsuit was filed by a coalition of members from the New York Taxi Workers Alliance against the Taxi and Limousine Commission and Governor Andrew Cuomo, seeking to stop the congestion surcharge, arguing that the fee adds an “additional crushing burden on a workforce already facing financial despair.”

But the MTA is countering that claim by highlighting the need for the fee and says that the delay could result in millions of dollars in lost revenue in the beginning weeks of 2019. The agency expected to receive about $1 million a day from the fee to fund subway repairs, but is now worried that it could miss out on around $17 million if the judge decides to delay the charge any longer or even issue an injunction, reports the Wall Street Journal.

Taxi medallion owners, who already pay hefty licensing fees have stated that the additional congestion fee unfairly targets their industry at a time when it is facing severe hardship. Last June, 139 medallions, once worth as much as $1.3 million, headed to bankruptcy auction and sold for as little as $160,000. The fee is slated to add $2.50 to yellow cab rides and $2.75 to green cab rides, despite yellow cabs already equipped with a 50 cent fee that is funneled directly to the MTA. Ride-hailing apps like Uber and Lyft would have a $2.75 congestion fee.

A spokesperson for Governor Andrew Cuomo told the WSJ that that state is “preparing a strong and comprehensive submission to the court in advance of the hearing” but would have to “rethink its congestion fee” as a source of long-term funding for the MTA if the judge ruled in favor of the Alliance.

The judge is scheduled to make a decision today, but could postpone if necessary.

• Congestion Fee Lawsuit Could Cost MTA $17 Million in Revenue [Wall Street Journal]
• Congestion pricing fee on for-hire vehicles temporarily stalled [Curbed]