Cities across the country are looking at New York. On Wednesday, the New York City Council approved a one-year pause on new licenses for Uber and Lyft vehicles while officials study the impacts of ride-hailing on the city. It’s is the first time a big U.S. city has capped the number of Uber and Lyft cars permitted, according to The New York Times.
New York will also have the ability to set minimum fare rates for drivers, as part of a package of bills passed Wednesday. There are some exceptions to the pause. For example, new wheelchair-accessible vehicles will be permitted. Speaking with the New York Daily News, one council member reportedly said he didn’t expect a permanent cap on ride-hailing vehicles to be established.
“The City’s 12-month pause on new vehicle licenses will threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion,” an Uber spokesperson said.
Although it is first with this type of regulation, New York is hardly the only city considering ways to reign in the nascent ride-hailing industry. If New York’s new rules are successful at reducing traffic and helping drivers earn living wages, they could provide a blueprint for other cities.
Seattle is a likely candidate. The city is eager to exercise some control over companies like Uber and Lyft, which are rapidly reshaping transportation infrastructure around the world. In 2015, Seattle passed a law that allows Uber and Lyft drivers to effectively unionize and negotiate pay rates and employment conditions. That law is stalled up in appeals court.
Other cities across the U.S. and abroad are also exploring regulations in the hopes of increasing driver compensation and reducing congestion. Last month, a new report from Schaller Consulting added to the sense of urgency. The study found that carpooling services like UberPool and Lyft Line exacerbate traffic by dissuading travelers from taking public transit.
In New York, the City Council paints an alarming picture. An average of 2,000 new on-demand vehicles are added each month, according to one council member. Over the next year, the city will study whether a long-term cap on ride-hailing companies makes sense. Whatever New York decides will certainly send a message to other cities.