Thursday, April 19, 2012

Legal Challenges to New NYC Livery Rules

The New York Taxi and Limousine Commission is voting today on the proposed rules for outer borough livery cabs. Just in time, the yellow cab medallion owners have filed suit to block the program. From the NY Times:
A group representing owners of New York City’s signature yellow cabs filed suit on Wednesday over plans to allow livery cars to pick up passengers on the street outside the heart of Manhattan.
The State Legislature authorized the change in February, and the city’s Taxi and Limousine Commission is expected to vote Thursday on whether to enact it.
City lawyers said they were confident that the plan, proposed by the Bloomberg administration last year, met legal requirements. It would allow 18,000 livery drivers buy permits to collect passengers when hailed in Upper Manhattan and the four other boroughs. Advocates of the plan say it would benefit millions of people in areas where yellow cabs are not common.
But the taxi owners’ group, the Metropolitan Taxicab Board of Trade, said the plan violated the rights of yellow cab owners who paid hefty fees for what has been an exclusive citywide right. It is seeking an injunction.
The proposal will also add 2,000 new yellow cab medallions. One of the issues here is that the medallions are worth about $1 million each, so the owners of the medallions seek to protect their economic rents and maintain the NYC taxi industry as a capital intensive industry with high barriers to entry. However, the goals of the taxi medallion owners do not perfectly align with broader social goals of mobility and access to transportation choices.

Perhaps more to the point, the new livery program is designed to legitimize activity that is already happening. It remains to be seen if it will work, but it is an attempt to provide a regulatory structure that will allow the market for street hails in New York City to expand beyond parts of Manhattan and the airports.

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Here is a bonus link about regulating New York City's Green Carts and food vending. From the Washington Post:
Fruit-and-vegetable carts might seem like an idea that everyone can get behind in a city where some areas only have one supermarket per 60,000 residents. But New York’s Green Cart initiative was hotly debated here when it was proposed. City planners worried about congestion on the sidewalks and by busy subway stations. Small grocers objected to new, non-bricks-and-mortar competitors, especially those who didn’t have to pay high rents and utilities. But legislation ultimately passed in June 2008, granting up to 1,000 permits to vendors to sell fresh produce in underserved areas.
Open questions about these local regulations involve  what should the regulatory priorities be. Safety? Competition? Wages? Health? Traffic? The optimal number of bananas? These are all good issues deserving policy interventions, but regulating all of them simultaneously is next to impossible. What is most important to one actor in the process is not necessarily the highest priority for another actor.
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