Ride-Hailing Companies Offered New York $100 Million to Drop Proposed Cap

City officials refused the offer.

Uber, Lyft, and Via offered $100 million to New York City in the form of a relief fund to taxi drivers in exchange for dropping a proposed cap on licenses for ride-hailing vehicles, reports TechCrunch. However, city officials refused the offer.

According to TechCrunch, which cites documents provided by Lyft, the three companies would have contributed $20 million a year over five years into a "hardship fund" to support taxi drivers, who have seen their earnings decrease thanks to competition from ride-hailing services. In exchange, the companies asked city officials to drop proposed regulations limiting the number of licenses for ride-hailing vehicles, as well as proposed legislation setting minimum pay standards for drivers.

Aiding the city's beleaguered taxi industry is one of the main motivations of the proposed ride-hailing cap. Taxis in New York City require special licenses, called medallions, which can cost tens of thousands of dollars. But drivers who invest that considerable sum have seen their earning potential plummet due to competition from the likes of Uber and Lyft.

The outlook isn't particularly good for drivers who switch to ride-hailing services, either. While these services are immensely popular in New York City, drivers don't earn a guaranteed wage and must pay for their own vehicle maintenance, insurance, and fuel costs, which can eat into earnings.

Uber has argued that a cap on ride-hailing vehicles will simply hurt riders living outside Manhattan, where taxis are scarcer and the public-transit system is less developed. The company has said New York should focus on aiding taxi drivers and rebuilding its crumbling subway system instead.

The three companies' $100 million offer is brazen, but not surprising. Shifting the narrative away from the problems caused by ride-hailing services (such as traffic congestion) to helping taxi drivers depicts the ride-hailing companies in a more positive light. With the offered refused, New York's City Council could vote on the ride-hailing cap as early as August 8.