New York City officials are accusing the rideshare company Empower of evading tens of millions of dollars in congestion pricing tolls, potentially by operating without the required city license. City Council Democratic Majority Leader Shaun Abreu has urged the Metropolitan Transportation Authority (MTA) to investigate the company's practices.
In a letter to MTA Chair Janno Lieber, Abreu stated that Empower appears to be avoiding both the state congestion surcharge and the MTA's Congestion Relief Zone toll, which are mandatory for licensed competitors like Uber and Lyft. This alleged non-compliance allows Empower to offer lower prices to consumers while other transportation providers adhere to the law. Abreu estimates that Empower, which he claims handles up to 1 million trips monthly in New York City, could be shorting the city's public transit system by tens of millions of dollars annually.
Congestion pricing in New York City officially went into effect on January 5, 2025. According to Abreu, who also chairs the City Council's Committee on Transportation and Infrastructure, Empower's business model, where drivers pay a monthly app fee, set their own prices, and keep the full fare, positions it as a marketplace rather than a traditional dispatcher. However, the company has not enrolled in the MTA's per-trip congestion plan and lacks a Taxi and Limousine Commission (TLC) license. Consequently, riders using Empower do not see a congestion fee on their receipts, and Abreu alleges the company is not collecting these charges from passengers.
MTA Chairman Janno Lieber acknowledged the issue, stating that the authority is seeking to recover the lost fees and close any loopholes that allow companies to circumvent the system. "They're ripping off the public," Lieber said. "We have to find a way to make sure if they found a loophole it has to be closed."
Empower has countered these claims, asserting that the company has attempted to pay congestion fees and that their offers have been rejected by city officials. A spokesperson for Empower stated that the company met with city officials in late March and offered to facilitate the payment of any taxes or fees, including congestion fees, for TLC-licensed drivers using their software. However, a spokesperson for the mayor's office did not immediately respond to a request for comment on this meeting.
The legal dispute between New York City and Empower is ongoing. City lawyers filed a lawsuit earlier this year arguing that Empower, despite presenting itself as a neutral software provider, functions like a rideshare company by matching riders and cars, setting trip economics, and processing payments, all while avoiding TLC licensing costs and related fees.
Empower has faced similar regulatory challenges in Washington, D.C., since its launch there in 2020. Courts in the district ordered the company to cease paid rides for refusing to register as a for-hire operator, and both the company and its CEO, Joshua Sear, have been fined millions of dollars for contempt of court due to continued operation. Empower is reportedly still contesting these D.C. rulings.
Abreu has requested that the MTA investigate the extent to which Empower trips have bypassed the Congestion Relief Zone toll, determine the number of untolled rides, and calculate and recover the outstanding revenue. He also seeks a briefing for the City Council on the MTA's findings and future enforcement strategies.