As Sandy rages, the city releases controversial new rules about taxi apps

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Woman hails a cab in midtown, the old-fashioned way. (modenadude via Flickr)
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Today, at 11:47 a.m., just hours before the New York is to bear the full brunt of the worst storm in recent history, the city released controversial new rules about taxi apps.

"I kind of regret it, because I would like to have this get coverage and now nobody's going to pay attention," Taxi commissioner David Yassky told Capital, as he drove from Woodside to Office of Emergency Management headquarters in Brooklyn. "But it was just dictated by our hearing schedule. You have to [notify the] public 30 days in advance of the hearing."

The Taxi and Limousine Commission will hold  a hearing on the rules November 29, and vote on them December 13.

The rules, Yassky acknowledged, are likely to incite substantial opposition from some players in the city's taxi and limousine industry.

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"We've heard a fair amount of concern from the black car and livery industries, but I don't think these apps will have a significant impact on their business," said Yassky.

These new taxi apps are controversial because some believe they will upend the longstanding division of labor between yellow taxi and livery cars.

As the industry is now structured, yellow cabs respond to street hails, while black and livery cars respond to phoned-in requests, known as "pre-arranged" service.

The question is, when a smartphone user taps her phone and requests a yellow cab, and the yellow cab driver accepts that request, does that constitute a prearranged service, or simply a digital-age version of the old-fashioned arm-in-the-air street hail?

Today the city came down decisively on the issue, defining taxi app service as "e-hail" service.

The administration plans to alter city regulations accordingly.

"Our most important job is giving the passenger the best service possible and giving the passengers as many options to get service as are feasible," Yassky told me.

Passenger surveys indicate 70 percent of riders have smartphones, and 55 percent percent would like to be able to hail taxis and pay for them using smartphones, according to the city.

The proposed rules require Taxi and Limousine Commission approval of all new taxi apps, thereby ensuring, among other things, that they interface appropriately with its existing meter system.

All manner of taxi apps will be permitted, including those that allow the driver to confirm that he is going to pick up a passenger.

Drivers will not be required to use the new apps. 

They will be forbidden from using them at JFK and LaGuardia airports, and while their cars are in motion.

And, in an effort to prevent drivers from discriminating against passengers going to far-flung locations, apps will not be permitted to show passenger destination information to drivers.

Earlier this year, the city launched a competition for a new smartphone payment option.

Since then, taxi-app developers have been raising money with the intention of breaking into the New York City market, only to be stymied by lingering questions over the legality of taxi apps.

The new rules are intended to clear up the confusion.

And today, that original competition was declared null and void.

"We thought we needed to designate an exclusive person, but it turns out that there's considerable interest in providing this kind of a service, and so we'll just let the market do its thing," said Yassky.