A bill that is being proposed to the New York City Council could put a temporary cap on the number of for-hire vehicles in the city, potentially affecting companies like Lyft and Uber. (Tweet this)
Next week the City Council will hear the bill that hopes to analyze the effect of the ride-sharing economy on traffic congestion and the environment. The cap would last until the end of the study or August 2016.
New York City Council member Stephen Levin, a Democrat, told CNBC's "Squawk Alley" on Friday that over the last four years, the number of for-hire vehicles has increased from 38,000 to over 63,000 in the city.
"I think it's a reasonable thing to say that has some environmental impact and we need to study it," he said. "We need to limit the growth so that the findings can be accurate and not obsolete when they come out in a year."
He added that currently about 2,000 new licenses are approved every month, which means that without a cap there could be about 24,000 new for-hire vehicles on city streets in 12 months.
City Council Member Ydanis Rodriquez, also a Democrat, spoke in the same interview and said that because the industry has been changing so rapidly in the last couple of years, an environmental impact study is required.
The cap would affect all for-hire vehicles applications and not target any particular company, Levin said.
CNBC received the following statement from Uber regarding the proposal:
Three months ago, the taxi industry put forward a proposal to protect the status quo, and limit competition and innovation. Today, the de Blasio administration and city council members revived a nearly identical proposal. Unfortunately, this would reverse improvements made by Uber and others to our transportation system and most notably stand between New Yorkers looking for work and their opportunity to make a better living.
Earlier on Friday, Dean Baker, co-director at the Center for Economic and Policy Research, said that the sharing bubble is "largely hype."
"Which isn't to say that these companies don't offer benefits; they do," he said in an interview on CNBC's "Squawk Box." "But I think the idea that these are altogether novel, unique and a whole new way of treating the economy, that's very misleading and basically wrong."
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Baker raised concerns about how these sharing companies tried to evade regulations overall. Some of those regulations, he argued, are necessary, like protections for the handicapped or against racial discrimination. In addition, he said, there should be ways to protect workers who are deemed independent contractors by these companies rather than employees.
"The idea that we're [sharing companies] over the web and none of this [regulations] applies to us, that doesn't make sense," Baker said.