Taxi merger

With big changes in store for taxicab regulation, drivers fear ulterior motives by city officials and industry executives

A plan to merge the Taxi Commission with the Municipal Transportation Agency will be heard by the Board of Supervisors on Nov. 25. Most city officials and taxi industry bigwigs support the change, but some drivers fear it could signal the end of the semi-autonomous medallion system that has been in place for 30 years.

The merger legislation by Sup. Aaron Peskin is brief, simply transferring duties from the Taxi Commission to the MTA beginning March 1, 2009. But Peskin also helped write another key piece of legislation — last year's sweeping MTA reform measure Proposition A — that contains a provision allowing the MTA to wipe out all prior taxi regulations.

Skeptics fear that the real target of the merger is Prop. K, the 1978 law that created the current driver permitting system, which requires taxi medallions that are owned by the city to be in every car. With the MTA in control, the door could be open to privatizing taxi medallions. These permits are currently leased by the city for a fee — $658 a year for most cabs — to longtime drivers, but a scheme to sell or transfer them could mean huge profits for the select group of drivers who now hold medallions, with a potentially high transfer fee kicked back to the city.

Reguutf8g San Francisco's taxi industry involves ensuring cabs are being properly operated, with medallions held by legitimate drivers, and investigating various complaints. But the Taxi Commission barely has enough money to meet its mandate. Proponents of the merger say the MTA can bring more resources and professional attention to the industry. Mayor Gavin Newsom, who as a supervisor in 1998 pushed for formation of the Taxi Commission, has long supported the merger as a way to have all transportation housed in one agency.

"The benefit of merging is the MTA already regulates all surface transportation," said Jordanna Thigpen, acting director of the Taxi Commission, who was appointed by Newsom after the Taxi Commission ousted Heidi Machen in 2006. "Most cities in the country do incorporate taxis into the common transportation agency."

Currently, cab companies, medallion holders, and rank and file drivers essentially function as a feudal system, with the serfs driving San Franciscans around in vehicles usually owned by the lording cab companies and permitted by older drivers who hold the coveted medallions. There are only 1,500 of these permits, which are literally tin medallions that correspond to the numbers printed on the sides of cabs. They are owned and regulated by the city, and leased for life to drivers who wait years to move up the list.

Medallion holders make about $20,000 to $50,000 per year leasing their medallions to cab companies, which then charge drivers daily "gate fees" that are set by the city. Drivers pay an average of $96.50 per day to use a cab, but are allowed to pocket all their fares. Drivers usually clear about $150 a day, but that's before paying gas, tolls, and tickets, and before even sometimes allegedly slipping bribes to dispatchers to get the best assignments. Drivers have no health insurance and are essentially treated as independent contractors.

Drivers have criticized the newly formed Taxi Advisory Group, which has made recommendations to the MTA and is likely to be expanded after the merger into a 15-member council, which would have only three drivers, but seven medallion holders and cab company representatives. Five members of the public would also be seated and their unanimous support would be required for a driver-led initiative or idea to trump the medallion and cab company bloc.