The New York City Council on Wednesday agreed to cap the number of licenses for ride-hailing services such as Uber Technologies Inc for one year, dealing a blow to the companies that have relied on the largest us metro area for a major source of their revenue.
New York Mayor Bill de Blasio said he meant to sign the bills into law, which would start the 12-month period where no new for-hire vehicle licenses would be issued, with an exception for wheelchair-accessible vehicles.
Another source on the council, however, told Crain's that the legislature was still tweaking the bill in the lead-up to the vote so as to mollify the ride-hail industry while keeping the cap in place.
The package, opposed by major ride-hailing companies, is aimed at reducing traffic congestion and increasing driver paychecks in the wake of the explosive growth of for-hire vehicles.
GOP communications strategist Lee Carter said the ride-sharing cap campaign is less about driver wages and has more to do with congestion on the streets of NY.
In a committee meeting on Wednesday, New York City Councilmembers cited concerns over pay and quality of life for the 80,000-some drivers now working as independent contractors under Uber and Lyft. "It would also allow the Commission address incomes for app-based drivers, 85 percent of whom now make below minimum wage". Although a number of cities have tried to shut down Uber and Lyft altogether, or attempted to force the companies to operate exactly the same as taxicabs, this marks the first time a major city has passed legislation that will regulate ride-hailing apps as their own industry.
A Lyft spokesperson said the council's vote "will have a detrimental impact on those that have historically been underserved by taxis: communities of color and the outer boroughs".
Uber has campaigned against the legislation, warning riders that a cap on drivers will create higher prices and longer waits for cars. "Our city is directly confronting a crisis that is driving working New Yorkers into poverty and our streets into gridlock", de Blasio said. Lyft has acquired the Motivate bike-sharing company.
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