N.Y. Taxi Drivers Will Receive Millions in Aid After Hunger Strike

If other lenders agree to the same terms, it would effectively amount to the bailout that drivers have sought since the debt crisis jumped into the spotlight in 2018, when several drivers facing financial devastation began to die by suicide.

“Today marks a new dawn, a new beginning for a work force that has struggled through so much crisis and loss,” said Bhairavi Desai, the head of the Taxi Workers Alliance, which says it represents about 20,000 drivers. “Drivers will no longer be at risk of losing their homes, and no longer be held captive to a debt beyond their lifetime.”

All drivers who own their medallion are eligible, even if they are not part of the group.

The roots of the crisis began about two decades ago, when a group of industry leaders began steadily and artificially inflating the price of medallions, which are regulated by the city.

As the price soared to $1 million, drivers who wanted to own their own cab, instead of working for a taxi fleet, took on hefty loans that they could not afford, while lenders pocketed hundred of millions of dollars, The New York Times reported in a 2019 series.

The market collapsed in 2014, leaving drivers in debt they could not repay. Hundreds went bankrupt. Industry leaders have long denied wrongdoing, blaming the crisis on ride-hailing companies like Uber and Lyft, which entered New York near the bubble’s peak and eventually took some revenue from cabs.

(Marblegate was not among the lenders that engaged in these practices; it did not begin acquiring loans until after the medallion bubble burst.)

Mr. de Blasio announced his original relief plan in March. That program, which was estimated to cost $65 million, provided individual medallion owners with up to $29,000 apiece in grants to help them negotiate with their lender to lower their outstanding debt. It did not provide a loan guarantee or persuade any lenders to reduce its loans en masse.