Fans of Uber will be relieved to hear that a longstanding City criticism of the app-based car services industry has lost some of its legitimacy.
Some have said that the explosion of app-based car services, or e-dispatch vehicles, in New York City (like Uber and Lyft) would lead to an unmanageable congestion burden, but an official report from the Mayor’s office says that their arrival is not a primary factor in the City’s worst congestion increases.
Titled “The For-Hire Vehicle Transportation Study,” the report reveals that there has indeed been net driver growth on city streets since the arrival of Uber in 2010. Besides new drivers joining the for-hire vehicle ranks, many former yellow cab drivers have simply switched to Uber and Lyft. In the past two years, the number of active yellow taxi drivers declined five percent, but new for-hire vehicle registrations by former yellow taxi drivers rapidly increased.
The report found that while e-dispatch vehicles do contribute to overall congestion, they are not to blame for the recent uptick in congestion in Manhattan’s Central Business District (CBD). The area south of 60th Street has seen vehicle congestion rapidly increase in the past five years. Peak hour vehicle commuters in NYC saw an average annual delay of 74 hours in 2014. The annual cost of lost time due to congestion is estimated at $14.7 billion. In the last two years, average vehicle speeds have fallen nearly 10 percent.
But if it’s not an increase in for-hire vehicle volume, what’s causing the congestion increase in the CBD? “Population and job growth, increased construction activity, growth in the number of deliveries, and record levels of tourism have all contributed to the reductions in vehicle speeds,” the report reads.
The question of putting a cap on for-hire vehicles was the primary question when a vote over restrictions on Uber was postponed by city council last summer. The Mayor’s office report does not recommend a cap “at this time.”
However, the report’s authors predict the rise in app-based car services could be detrimental to the amount of accessible options in the City, as most accessible options are provided by yellow and green cabs.
They also see that the trend toward e-dispatch vehicles could create a revenue shortfall for transportation funding. Yellow and green cabs pay a 50 cent MTA surcharge on each ride that for-hire vehicles do not pay. Instead for-hire vehicles pay a per trip sales tax of 8.875 percent, with 0.375 percent for the MTA, 4.5 percent to the City, and the balance to the State. Experts recommend regulatory changes to ensure that the continued rise in e-dispatch vehicles is not accompanied by a funding deficit.