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Congestion pricing fee on for-hire vehicles can proceed, judge rules

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The fee can proceed, but the Taxi Workers Alliance’s lawsuit has not been dismissed entirely

A State Supreme Court judge ruled on Thursday that the city’s proposed surcharge on for-hire vehicles could proceed, after the judge found that the charge did not “demonstrate irreparable injury” to the business of for-hire vehicles.

A lawsuit brought by the New York Taxi Workers Alliance in late December against the Taxi and Limousine Commission and Gov. Andrew Cuomo worked off the idea that the fees would be “an additional crushing burden on a workforce already facing financial despair,” said NYTWA Executive Director Bhairavi Desai.

The surcharge would add a per-trip fee of $2.50 for taxis and $2.75 for green cabs and other for-hire vehicles like Lyfts and Ubers making trips in Manhattan below 96th Street. The estimated $400 million annually that would be generated by the surcharge would be used to fund subway repairs. Yellow cabs already have a 50 cent fee that is funneled directly to the MTA—The congestion fee would provide additional funding to the MTA.

In addition to ruling that the surcharge could proceed, Judge Lynn R. Kotler denied the state’s motion to dismiss the lawsuit saying that the TWA’s concerns merited further investigation, the New York Times reports.

“We feel triumphant that the state’s motion to dismiss was denied and it gives us hope that ultimately the state will do the right thing and spare drivers the poverty and crisis that would result from this congestion fee,” Desai said in a statement on Thursday’s ruling. “We’re calling on the governor not to move forward with fees that will force drivers to choose between food and medicine.”

Desai added that implementing the surcharge before the lawsuit concluded could put the industry in the tough place of having to figure out how to refund passengers should the drivers win their case.

Patrick Muncie, a spokesman for Cuomo, told the Times that the decision was “a positive step in our efforts to find a dedicated revenue stream for our subways and buses, as well as easing congestion in Manhattan’s central business district.”

The for-hire vehicle surcharge was supposed to go into effect on January 1, but a temporary restraining order on the fee issued in late December has prevented it from going into effect.

The value of yellow taxi medallions has been plummeting amid competition from ride-hailing apps like Uber and Lyft. In June, it was announced 139 medallions would head to bankruptcy auction. The medallions were once worth as much as $1.3 million but have recently been auctioned off for as little as $160,000. Eight professional drivers in New York have taken their own lives within the past year, says the Taxi Workers Alliance. In October, the Taxi and Limousine Commission announced that it would waive the $1,100 renewal fee for the city’s 11,286 medallion owners.