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Cabbies steamed over proposed taxi overhaul

Jim Welte
The Public Press
 — May 12 2009 - 12:17am

Tuesday afternoon, the Board of Supervisors is expected to consider a resolution to reject the proposed budget of the San Francisco Municipal Railway because of steep fare hikes, deep service cuts and millions of dollars in questionable reimbursements to other city departments.

But the proposal that has drawn the most ire at public hearings is Mayor Newsom's plan to overhaul the city's taxi industry by changing the system for awarding the coveted driver permits known as medallions. Newsom and Muni's parent, the Municipal Transportation Agency (MTA), say the scheme would generate $15 million a year in new revenue for the cash-strapped transit system.

Newsom announced the proposal in January, but few details have been released. Muni officials say they are still trying to reach agreement with taxi industry groups. The revenue would come from the public auction or transfer of taxi medallions, which are held by nearly 1,500 of the 6,000 cab drivers in the city.

Under the current system, created by Proposition K in 1978 and affirmed several times by voters since then, taxi drivers put their names on a lengthy waiting list to buy a medallion. Drivers can wait 15 years or more to move up to the top of the list to buy a medallion, which costs them about $500 a year. Other drivers can then lease permits from the owners, often for as much as $4,000 per month.

Because medallion owners are mostly older, the permits are seen as a source of income for retired drivers. So the proposal to radically alter the medallion system attracted hundreds of drivers to a series of public hearings on the MTA budget in recent weeks.

"This process has shown contempt to drivers, the taxicab industry as a whole, and to the public," said Mark Gruberg, co-owner of Green Cab, who also represents the United Taxicab Workers. "This has not been an open process. This is no way to conduct public policy."

Fellow Green Cab co-owner Joe Mirabale went a step further. He warned the MTA board that if it went forward with plans to sell medallions on the open market, cab drivers would propose a ballot measure to strip the MTA of its recently acquired authority to regulate the taxi industry.

"By enabling the transfer of medallions, you will cripple this industry," Mirabale said.

Medallions auctioned by other cities have fetched more than $100,000. In New York recently, one sold for almost $500,000.

"We have been a stand-alone, debt-free industry for decades, and now the mayor has decided that we're going to be the cash cow that's going to bail out Muni," said Ruach Graffis, past chair of the United Taxi Workers.

The $15 million the MTA hopes to generate from the taxi medallion program was included in the budget, but the MTA board emphasized that it would find other sources of revenue if it could not come up with a program that had the broad support from the taxicab industry.

"This budget isn't contingent on raising this $15 million from the taxi industry," said MTA board member Malcolm Heineke, who is part of a task force examining taxi reform.  "I'm not voting for this budget locking us into selling medallions. These are people who have organized their lives based on the opportunity to get a medallion, and the uncertainty out there is paralyzing to them."