(Bloomberg) – New York City has arranged more than $225 million in debt relief for more than 1,000 taxi medallion owners to help an industry battered by competition from Uber Technologies Inc. and… other app-based automotive services, Mayor Eric Adams said.
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Last month, the Adams administration finalized a deal with Marblegate Asset Management, the city’s largest medallion lender, and the New York Taxi Workers Alliance that provides debt relief to more than 3,000 medallion owners. Many struggling drivers cannot afford the expensive loans they took out from private lenders to buy city taxi operating medallions.
“There’s something iconic about our yellow cabs,” Adams said at a City Hall event where he was joined by union members and officials, including U.S. Senator Charles Schumer and Rep. Alexandria Ocasio-Cortez. “It’s the foundation of our city.”
Schumer said that because of the agreement, “things are fairer today for our hard-working taxi drivers.” Bhairavi Desai, executive director of the alliance, cited the number of taxi drivers who committed suicide due to financial difficulties.
Called Medallion Relief Program+, the program allows homeowners to restructure their loans, capping debt at $200,000, with monthly payments limited to $1,234 for up to 25 years. Under the program, the city makes a $30,000 down payment on the loan and agrees to cover the cost of the medallion if the owner defaults.
The city also extended the deadline for homeowners to restructure their loans by one week, to Oct. 7.
New York raked in around $850 million in revenue from the sale of 1,000 medallions from 2004 to 2014, promoting them as solid investments before 80,000 Uber and Lyft Inc. drivers hit the city streets and wreaked havoc the yellow taxi industry.
The debt relief deal was originally reached in November with former Mayor Bill de Blasio’s administration following a 15-day hunger strike by taxi drivers.
“We thank those of you who went on the hunger strike,” Schumer told the crowd.
(Updates with union leader’s comment in fourth paragraph. An earlier version of this story corrected the debt relief amount.)
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