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😒 Bad Vibes
Perpetual TLC policymaking-related lawsuits are creating bad vibes in the NYC for-hire transportation industry. Drivers, businesses and taxi medallion owners are frustrated
The City / TLC won a lawsuit brought by the New York Taxi Workers Alliance (NYTWA) related to the issuance of ~2,500 SHL Pilot for-hire vehicle licenses
Perpetual lawsuits related to City / TLC policymaking is not a sustainable norm for the industry and will prevent industry investment, ultimately impacting driver earnings and overall levels of market optimism
Just because something is technically allowable by referencing City law minutiae, doesn’t mean it’s the right policy
Although TLC cites SHL Pilot ruling to help advance current litigation around legality of reinstatement of EV exemption to FHV License Pause (TLC Plate Cap), regulator is missing the point
“We respect you, we’ve done good work together on the medallion-debt forgiveness, on the raise…But you, sir, you’re wiping all that good away right now…Adding 2,500 new cars, on top of the 1,000 that they just added with electric vehicles, that is a significant increase in this industry when ridership is still down by 30% from 2019.”
- NYTWA President Bhairavi Desai speaking to NYC TLC Chair David Do after the TLC Commission Board approved the SHL Pilot in May 2023 (Additional source: THE CITY)
Jose Martinez of the THE CITY reported that the TLC prevailed over the New York Taxi Workers Alliance (NYTWA) related to a lawsuit about the issuance of ~2,500 TLC SHL Pilot for-hire vehicle (FHV) licenses. The New York State Supreme Court Judge overseeing the case sided with the TLC, ruling that the two year Pilot will likely have “minimal” impact on the existing NYC for-hire fleet. NYTWA plans to appeal the ruling.
According to the TLC, about 700 FHVs are participating in the SHL Pilot currently.
“At most, the [street-hail livery] program will bring the number of licensed vehicles to 109,051, an increase of 2.34%…While this increase may not be entirely negligible, it is far from a given that it would impact the market in any significant way.”
- New York Supreme Court Judge Nicholas Moyne
In a statement to THE CITY, TLC Commissioner David Do said he was “pleased” with the ruling.
“We created this limited pilot program with direct input from drivers, with the goal of reducing up-front costs for green cab licensees as well as increasing outer-borough service, particularly for non-emergency medical trips,” Do said
- THE CITY (Taxi Workers Alliance Loses Battle Against Driver Permit Increase, by Jose Martinez, published March 29, 2024, 4:00pm)
TLC vs. NYTWA
Below, we’ll try to summarize what the SHL Pilot was/is as quickly as possible, while also providing important context. Then, we’ll speak about industry vibes 😒.
Background to NYC Green Cabs (a/k/a SHLs)
“Street-hail Liveries, also known as green cabs, are For-Hire Vehicles that are permitted to accept street-hails. In exchange, Street-Hail Liveries may not operate in the Hail Exclusionary Zone, south of West 110th St and East 96th St.
The Street-Hail Livery permit is a license that is attached to a For-Hire Vehicle license. Like all For-Hire Vehicles, green taxis affiliate to and accept dispatches from FHV Bases. In addition, green taxis can accept dispatches from licensed E-Hail companies, and must be outfitted with the same equipment as yellow taxis.”
- NYC TLC
Although this may now sound like an unimaginable past, just before Uber became a verb, NYC created the “green cab” in 2013. These Apple Green cabs were created in response to an NYC FHV shortage 👀 (yes, you didn’t read that wrong), especially for residents living in or needing to travel from/within outside central Manhattan.
When launched, the City made rules regarding how many new green cab FHV Licenses (known as SHL Permits) could be issued and established a new licensing regime. Near the height of the green taxi’s popularity in 2014, the Wall Street Journal reported there were 5,200 green taxis making 43,000 trips per day. Based on TLC data it appears the summer of 2015 was the green cab sectors “trip peak” at ~58,000 trips per day across ~6,500 unique vehicles.
Unfortunately times have drastically changed for green cabs (SHLs) from the rise of Uber/Lyft to the pandemic.
SHL Pilot Program (May 2023)
On February 8, 2023, the TLC held a public hearing about the green cab / SHL sector. This was a few months before formally presenting the SHL Pilot (what the NYTWA lawsuit related to). The February 2023 meeting on SHLs lasted less than 25 minutes and only had a few, albeit good, speakers testify at length.
To many peoples surprise, not too dissimilar to what happened on October 18, 2023 with the shock full reinstatement of the EV exemption to the FHV License Pause (TLC Plate Cap), the regulator presented a Pilot in early May that allowed for the issuance of up to 2,500 new “SHL Permits” (Note: the TLC viewed it as a reissuance of retired permits). The regulator framed the SHL Pilot as being mostly about green cabs, but the program really seemed to be about using the SHL Permit licensing regime, created for green cabs, to help traditional black car & livery bases access new FHV Licenses (a/k/a TLC Plates).
As you can see from our side-by-side comparison below, the Pilot essentially created an outer borough “restricted” traditional black car & livery FHV license. It stripped away the street hail (“SH” in SHL) rights for green cabs, but called it an SHL Pilot?
As we covered in May 2023, audience members at a TLC Commission meeting (& vote) on the SHL Pilot, mostly belonging to the NYTWA, were visibly upset about the TLC’s decision to approve the proposed SHL Pilot. Remember, the Pilot specifics came with little notice or discussion. The yellow taxi medallion industry and NYTWA, its most prominent advocacy group, were upset because the Pilot called for the issuance of up to 2,500 new FHV Licenses, when the yellow cab sector was still struggling (see video at beginning of article).
Our opinion at the time tried to be balanced and also highlighted that the traditional black car and livery sector, was also calling for a way to access new TLC Plates. We thought the TLC setting a specific number (2,500) and making a restricted FHV License also made it a more thoughtful, but still controversial, Pilot program.
“…our readers will know, we’ve been pretty consistent on reiterating that the last thing the NYC for-hire transportation industry or City needs is **MORE TLC PLATES**, congesting our roads and dividing a limited driver earnings pie. However, we do also know and have worked with several long time black car & livery base operators who genuinely believe accessing more vehicles (that Uber/Lyft can’t effectively dispatch), is the only path forward and a way to turnaround their businesses.
Time will tell.”
- AutoMarketplace (May 1, 2023)
TLC Cites SHL Win In Ongoing EV Plate Case
In today’s political environment, celebrating a legal win over what is effectively a working class NYC taxi drivers union, might be ill-advised. Not sure that’s what the Mayor or TLC wants to be celebrating. What the TLC really should be reflecting on is why they were sued by NYTWA and why do they continue to be sued by this well established and large driver advocacy group? 🤔
However, the route the City / TLC has decided to take is once again to become unnecessarily combative (but, to be fair, expected if they plan on winning another legal action against NYTWA). They essentially want to take one legal victory (which will likely be appealed) and try to leverage it to dismiss another case that NYTWA probably views as a more existential threat - whether the TLC had (has) the legal right to fully reinstate the EV exemption to the FHV License Pause (TLC Plate Cap) in October 2023. That policy led to the addition of ~10,000 more NYC FHVs, until a TRO stopped the policy, at least temporarily. Note, the TLC believes the lawsuit is what caused so many FHV Licenses to be added.
On March 29th, the City filed a legal document “Letter informing Court of decision in similar matter” related to the ongoing EV exemption case referencing the SHL Pilot win.
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Good Guy, Bad Industry Vibes
It’s no secret there are moments this publication has been highly critical of NYC TLC Chair David Do and his Taxi & Limousine Commission. At the same time we try our best to provide balanced coverage, giving Do and the TLC credit where it is due, from taxi medallion debt relief success to understanding technical details about insurance to correctly identifying self-driving technology as an existential threat to NYC TLC-licensed drivers.
We actually think, contrary to what it may seem, Chair Do is a well meaning and decent person and also understand he has political superiors he must answer to. In addition, and we’ve said this many times, he and his political bosses have a mandate to govern. A mandate given to them by the voting public. This must be respected, but also does not mean they are immune from criticism. In fact, they fundamentally will be subject to a lot of criticism as public-facing officials and civil servants.
This publication was never meant to be overly political. It was meant to be a technical trade publication for NYC for-hire transportation drivers, fleets and businesses. On the street and NYC TLC-specific industry insights provided by people who know and live the details. While many of our articles still qualify as technical trade pieces, we’ve realized over time, politics has a significant influence on writing technically about the “TLC business”.
For example, when drivers and fleets asked us whether they should buy electric vehicles (EVs) in October 2023, the answer was not so straightforward. Our experience and expertise as a fleet operator would say it’s too early or the financial math is difficult or full coverage insurance is not readily available. However, our political mind might have advised them to consider buying an EV to get hold of a FHV License (TLC Plate), before the opportunity disappears. We’ve even advised our own fleet customers in ways that resulted in them returning our vehicles.
Our customers and readers (hopefully) trust us, because they know while we can be opinionated, our thoughts do not lack technical detail. Nuanced, deeply researched opinions that analyze how policy and other details impact the business of being a NYC TLC driver or operating an industry-related business (i.e., fleets, insurance brokers and companies, car dealers, auto lenders, financial institutions, bases, rideshare companies, auto service shops, etc.).
What’s The Point?
We thought the above commentary would be relevant because this industry seems to find itself in a never-ending cycle of intra-industry hostility and lawsuits: TLC vs. Uber, Driver advocacy groups vs. TLC, Driver advocacy group A vs. Driver advocacy group B, Driver advocacy groups vs. Uber, TLC vs. “Predatory” leasing companies, Leasing companies vs. TLC drivers, Taxi medallion owners vs. TLC, TLC drivers vs. insurance companies, etc, etc, etc. The industry vibes 😎 aren’t great 😒.
Specifically, running a business in the NYC for-hire transportation industry remains very difficult because no one has regulatory visibility or clarity, not even for a shorter time frame. How does the regulator expect anyone, individual driver to corporation, to make any sort of investment into the marketplace when no one knows what the next morning, day or month may bring?
Will the TLC open up unlimited EV TLC Plates again in February 2025? As our friend, Carolyn Protz (NYC_TMODA on X) often says to us and others, there is a sort of perpetual “Sword of Damocles” dynamic happening with NYC for-hire drivers and businesses. Every time people think they’ve stabilized their earnings or business, a major policy change is enacted that forces everyone to question almost every assumption they had.
For example, many question whether the TLC is genuinely interested in a taxi medallion industry recovery? Some fleets we know often fear the TLC wants to kill, not regulate, the FHV leasing/rental industry? You can’t really expect people to a take a long-term view on the industry if this is the dynamic.
Simply put, what is the TLC trying to solve for? It’s not clear when observing policymaking. Speak to NYC FHV drivers and businesses, and we’ll bet the majority think “special interests” and lobbying might explain counterintuitive and counterproductive TLC policies. We’re not saying just because many people might think something is true, that makes something true, but there is usually also a lot of wisdom in NYC street truths (“wisdom of the crowd”).
Yesterday, when commenting on a yellow cab airport dispatch bribery scheme, TLC Chair Do stated the following.
“I’d like to thank District Attorney Katz, the Port Authority, and our own dedicated Enforcement officers, who assisted in cracking down on this reprehensible bribery scheme. More than 90 percent of our drivers are immigrants, and many of them came here to avoid exactly this kind of corruption in their native lands…”
- David Do, NYC TLC Chair & Commissioner
Do is exactly right, many immigrants or peoples parents (other ancestors) came to America to avoid “old country” corruption. Has he reflected on why so many NYC drivers and other industry participants might view the organization he currently runs as being corrupt in a way that reminds them of countries left behind?
Why does he think so many people, from working class immigrants to long-time New Yorkers, get so worked up when talking about the TLC? Who does he think NYTWA members represent? Is this just a normal complaint dynamic, or is something more happening. Remember, perpetual lawsuits against the TLC almost seem to be the norm now, this pace of legal action was not the norm before.