The item on medallions — permits that allow a cab to operate — had been an issue for several decades but has become a larger problem in the past 10 years as medallion leasing rapidly spread as a new business model. It created an industry of medallion brokers who illegally carried out color scheme functions without permits or oversight and took in profits, said Chris Hayashi, deputy director of SFMTA’s Taxis and Accessible Services Division.
Color-scheme leases are when a medallion holder leases out their taxi under a particular company name and color scheme. “The problem is, these brokers will have a whole stable of medallions and we don’t know what they’re charging and who they are and drivers are abused, getting overcharged,” she said. “This is going to help the economics of [taxi] companies quite a lot.”
Hansu Kim, president of the 170-taxi fleet DeSoto Cab Co., agreed and said the amendment “will change the industry in such a significant and positive way.”
“It makes it very clear that if you want to be your own boss, be your own medallion holder, you have every right to do that but you have to do it responsibly,” he said.
Another item on the agenda garnered attention before the transit meeting started.
About a dozen cab drivers staged a small-scale protest outside City Hall an hour prior, crying out against a proposed $9.75 raise in the cap for the gate fee, which drivers pay to rent a vehicle from a company for a shift. The legislation also includes a cancellation fee of up to $10 to passengers and permits drivers to charge a flat rate of up to $11 rather than a metered rate.
Most drivers complained during public comment about the additional fee in light of competition from newly recognized and regulated transportation network companies such as Lyft, Sidecar and Uber. Hayashi affirmed that the legislation had been in the pipeline for some time and was not meant to coincide with the taxi industry’s struggle for survival among the popular app-based services.
But SFMTA board Chairman Tom Nolan said that approving the change effective immediately would send a message that is “just too negative for [taxi] drivers right now.”
Board members voted to adopt the item but push its implementation to April 15 and review it for possible changes at a February meeting.
Charles Rathbone, assistant manager for Luxor Cab Company, which has about 250 vehicles and 800 active drivers, said his company would raise the gate fee only if justified with additional services to drivers.
He added that the fee increase provides some relief amid competition from Transportation Network Companies which he and many in the taxi industry feel “get a free ride while our industry is like, in a straitjacket.”