The latest MTA funding package put forward by the Senate has a taxi problem. With taxi advocates agitating against the plan and practical collection problems cropping up, this reliance on a new taxi surcharge might just be enough to sink the whole thing.
The new plan — outlined here — is centered around a new taxi surcharge. The Senate will soon vote on whether or not to institute a $1 drop-off fee for all New York City taxi rides. This fee will lead to at least $190 million — and probably well over $200 million — in revenue. Half of that money will go to fund upstate roads and bridges, a point with which transit advocates have taken issue.
The eventual destination for those funds, though, is besides the point. Just how will the city collect this money to siphon off to the MTA and the upstate transportation infrastructure fund? Crain’s delved into the issue, and many aren’t sure it’s possible. “We can’t figure that out,” Ethan Gerber, a taxi lobbyist, said to the New York-based business journal. “Most people still pay by cash.”
Senate Majority Leader Malcolm Smith and his office punted on the issue. “I don’t think that has been worked out,” a spokesman for his office said. “There’s of course a technical aspect, just as there was for the collecting tolls.” That is, of course, a false argument as the collecting of tolls would have required the simple installation of high-speed tolling technology. Toll problem solved.
Daniel Massey and Erik Engquist have more from a taxi industry intent on protesting this hearty fee:
Taxi drivers said the $1 fee would eat into their already slim profit margins. “This is a wage cut on taxi drivers,” said Bhairavi Desai, executive director of the New York Taxi Workers Alliance, which represents 12,000 drivers. “Drivers would really suffer for a long time if this were to pass.”
Ms. Desai was leading a delegation of drivers to Albany on Tuesday to give legislators an earful. Thousands more are expected to participate in a phone-in campaign to legislators’ offices. “Who has ever heard of a private industry bailing out a government agency?” she asked…
The Alliance also agrees there would be no easy way for the state to collect the surcharge and charges that lawmakers lack a fundamental understanding of the industry. “There is an underlying assumption here that the money will just be deducted from paychecks and easily collected by the state,” Ms. Desai wrote in a letter to Gov. David Paterson, Assembly Speaker Sheldon Silver and Mr. Smith. “This is absolutely false.”
As anyone with any inkling of a clue about the taxi industry knows, cab drivers rent their cars for a flat fee each day and keep all of the cash they make. Instituting a $1-per-ride fee will either lead to more off-the-books rides or rampantly inefficiently collecting practices. Yet again the Senate has shown an inability to understand how transportation works in New York City.
Outside of these practical concerns, cab drivers are concerned about their bottom lines. Some taxi driver advocates believed rides could drop as much as 33 percent, and it’s nearly undeniable that tips will continue to drop as they do every time taxi fares go up.
For its faults, the Ravitch Plan got it right. It penalized the people taking advantage of the free roads and did so in a way that would have benefited the MTA specifically and New York City on the whole. This latest plan is just a mess, and while it may have enough votes to pass, it’s just another bad political compromise from the Senate.