Today, Councilman Greenfield will introduce legislation in the City Council to rein in Uber’s exorbitant “surge pricing” and protect consumers from price gouging fares. Uber, a car service company which allows customers to hail a private car or taxi from a mobile app, has faced increasing scrutiny over its surge pricing model. Surge pricing allows for normal rates for car service to increase during peak demand hours, such as during rush hour, inclement weather or holidays to as much as nine times the original price. Many consumers who have used Uber while surge pricing was in effect have complained about exorbitant charges. Councilman Greenfield’s bill would put a cap on what prices Uber can charge during surge pricing. The fare may be no greater than 100 percent higher than the normal range of prices as opposed to Uber’s current max – 900%.
“Surge pricing is a fancy name for price gouging. It’s an unchecked system in the regulated taxi and livery industry that takes advantage of New Yorkers. A yellow cab in New York City may not charge you $225 for $25 ride simply because it’s snowing – neither should Uber,” said Councilman David Greenfield.
This legislation puts a prohibition on excessive rates by stipulating that no driver of a for-hire vehicle shall charge a fare greater than 100 percent higher than the normal range of prices. The normal range is determined by identifying the fourth highest rate charged by the base station dispatching such a vehicle, on four separate dates during the previous sixty days. Drivers found in violation of this prohibition would be penalized with fines no less than $200 or more than $500 for the first offense, drivers in violation a second time within a twenty-four month period could be given a fine between $350 to $1,000 and the Taxi and Limousine Commission could suspend the driver’s license for a period of 30 days or less.
Greenfield is introducing his legislation right before the holiday season because last year during the holidays, especially on New Year’s Eve, there were many complaints from Uber customers who felt they were victims of the unfair surge pricing system.
After its introduction in the City Council at this afternoon’s stated meeting this bill will head to the Transportation Committee for a hearing.