Home Taxis Bloomberg’s livery cab plan on the rocks

Bloomberg’s livery cab plan on the rocks

by Benjamin Kabak

The Taxi & Limousine Commission believes it has an Outer Borough* problem. They know that yellow cab drivers, looking to maximize their own profits, dislike long trips out of Manhattan, and they know that in all but the most well-off areas in Brooklyn and Queens, yellow cabs are nearly impossible to come by. The Commission has tried upping fines for belligerent drivers, and Mayor Michael Bloomberg has put forward an ambitious plan to allow livery cabs to pick up hails outside of Manhattan.

Yet, that plan appears to be on the chopping block. In the face of widespread and well-organized resistance from cab drivers and their advocates, City Hall’s plan to expand the contours of livery service is as good as dead, according to The Wall Street Journal. Per Andrew Grossman, the T&LC, in the face of opposition from the yellow cab drivers, is now looking for ways to, as the Journal says, “use yellow cabs—not livery cars—to expand taxi service outside of Manhattan.” Said on person, “I believe we are completely off the mayor’s original plan. I would go as far as calling it dead.”

Grossman has more on the opposition and the shape of things to come. He writes:

Yellow-taxi owners and drivers have been united in their opposition to Mr. Bloomberg’s initial proposal. They worry that if another type of non-yellow cabs are allowed to pick up people who hail them, revenue from fares and the value of a taxi medallion will decline. They also said that the city doesn’t do enough to enforce rules barring livery cars from picking up passengers without pre-arranged trips.

City officials rejected that argument, saying that since nearly all yellow-taxi pickups take place in Manhattan and at the airports, the new cabs wouldn’t cut into business. The taxi commission is increasing the number of citations it writes for illegal pickups. The City Council’s Transportation Committee is slated to hold a hearing Wednesday on legislation that would raise fines for violators.

Now, though, City Hall seems to be retreating on a central piece of the mayor’s plan for the outer boroughs: letting livery cars pick up passengers who hail them. Instead, the industry, City Council and the taxi commission are talking about plans that “preserve the yellow taxi’s exclusive right to a street hail,” while still giving people in more neighborhoods outside Manhattan the ability to hail a cab, another person familiar with the conversations said.

The details of the new plan are still being negotiated, but Grossman reports that it could include either more medallion sales with pressure to make more Outer Borough pick-ups or yellow cab stands in Outer Borough locations. For what it’s worth, cab stands within Manhattan have been met with limited success. It’s tough to see how that would translate to more availability outside of the island.

The Taxi and Limousine Commissioner David Yassky issued a guarded statement about the talks. “We’ve had some truly productive discussions with the Council and the various stakeholders on the plan, and a lot of ideas have gone back and forth across the table. Whatever form the final plan takes, Mayor Bloomberg said in January that we want to see the same high level of taxi service available to people in all five boroughs, and that’s the bottom line,” he said.

The issue though is one of market capitalism vs. a regulated industry. New York City’s yellow cabs are a regulated industry that exists by the grant of medallions from the Taxi & Limousine Commission. Along with that medallion comes terms that require cab drivers to travel anywhere within the five boroughs, but as cab drivers seek to make a living, they find that long trips outside of Manhattan aren’t profitable. There is no guarantee of a return fare, and the trip can take valuable time off the clock.

Yet, 80 percent of New Yorkers live outside of Manhattan and deserve better cab service, and cab drivers operating by a government license shouldn’t deny anyone a ride. A comprehensive plan would address all of these concerns, but with a strong taxi industry pressing back against changes, I’m not optimistic the compromise will be a good one for non-Manhattan residents of the city.

* I don’t use this team as a derogatory reference to parts of the city that aren’t Manhattan. It’s just meant to shorthand so I don’t have to type out “Brooklyn, Queens and the Bronx” over and over again.

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pete April 27, 2011 - 11:52 am

The answer is easy. Sell Manhattan/airport pickup medallions and then other per borough medallions. You have to absolutely make sure the name of the borough that the taxi is licensed to is written with large letters on the taxi, or you know what will happen.

Another solution would be to GPS all the taxis. If they don’t pickup enough customers in colored areas in the outer areas of NYC per month, they goto jail for civil rights violations/discrimination/hate crime/whatever. I’m sure you can get Al Sharpton’s support on this plan. Remember to ignore that most taxi drivers are colored.

Marc Shepherd April 27, 2011 - 12:22 pm

Those are two wildly impractical ideas. So much so, that I wonder if you are joking.

It’s remarkable that the taxi industry objects to the original proposal. Since they so seldom have pick-ups outside of Manhattan and the airports, what exactly would they lose if livery hails were legal in the outer boroughs?

In any event, livery hails in areas poorly served by taxis are commonplace already. I can’t imagine that the city could ever hire enough enforcement staff to prevent them. I, for one, would prefer they didn’t: it’s nice to know that livery is there when no yellows are around.

Bolwerk April 27, 2011 - 12:28 pm

My guess is yellow cabs have a few high-impact pickup zones in the outer boroughs, specifically places like the Bedford Avenue region of Williamsburg, Brooklyn Heights, and perhaps some neighborhoods around Prospect Park. Liveries could cut into their market in those kinds of places, I guess, but it seems like a stretch to assume that people would prefer a livery cab to a yellow cab.

Bolwerk April 27, 2011 - 12:22 pm

Eh, I don’t think anybody is making this into a racial issue.

And the answer is easy. Just let the cockroaches non-medallioned cabs pick people up in the outer boroughs. No harm done to anyone. At most, it might become slightly harder for yellow cabs to find fares back.

Bolwerk April 27, 2011 - 12:16 pm

I gets pretty tiring always seeing interest groups in New York derail perfectly good ideas because of the flimsiest argument that they could be harmed. Congestion pricing and bridge tolls hurt a non-existent mass middle class, PPW supposedly hurts people…for god knows what reason, construction workers can’t lose the people who aren’t doing much work, the TWU membership is hurt by having to make sensible concessions mostly about work rules,* and cab drivers are harmed by street hails in the very places you have to fight to get a cab to take you. During the rainstorm I guess 10-11 days ago at around 1am, I had to literally make a case to a cabbie that taking me from Astoria to Sunnyside was in his interest because he’d have a fare as he travels closer to the Queensboro Bridge.

* they’re tired, and just want to take a nap in the booth

Chris April 27, 2011 - 2:10 pm

For the most part these arguments aren’t flimsy at all. People will genuinely suffer; workers will lose jobs, see hours cut, or be forced to work harder. The taxi industry will of course be harmed if some of its armor against competition is removed; the value of the exclusive right to street hails is in the tens of billions. That sort of sum is hardly flimsy. The interest groups being affected understand this very well and that’s why they’re fighting the changes so strongly.

Al D April 27, 2011 - 2:27 pm

Yeah except there are nary a yellow cab in many, many neighborhoods where these livery cabs operate. And bus and train options are limited in these areas. Also, if a family goes shopping and has lots of bags, they take a livery cab back instead of taking 2 buses, etc. for both speed and convenience.

Bolwerk April 27, 2011 - 4:31 pm

Eh, the the value of what people are actually talking about, outer borough street hails, is not going to come close to billions$. I’d be surprised if revenue from such trips broke out of the low millions annually, and breaking into the low millions might be a stretch if you exclude outlying popular destinations nearby Manhattan like the Bedford Ave. night strip. You know what many yellow cab drivers do when you ask them to take you to an even slightly remote outer borough destination? Lock their door and drive away. I’m not very sympathetic to “forced to work harder” arguments when working harder means actually spending more of your non-working time actually working. Of course I’m sympathetic to people who lose their jobs, but there comes a point where you actually need to accept that these often skilled people are going to have to go elsewhere for employment. And all that aside, the most important stakeholder is often the one that gets hurt the most: the general public. If politicians howled as much about transit fare hikes as they do about bridge tolls for people who don’t want to pay their own costs, we’d be better off.

These arguments are worse than flimsy; they’re malicious and selfish, on top of being flimsy. If unions want relevancy and respect, they need to help their members adjust, not just hold onto increasingly useless job titles just because it means another dues-paying member.

Chris April 27, 2011 - 5:14 pm

But it’s a threat to the entire premise of medallion exclusivity, which is worth that much based on the medallion market’s capitalization. Medallion holders have a very solid, non-flimsy reason to fight against any change from the status quo that disfavors them, and there’s nothing malicious about it. It may be selfish, but they are just looking out for their own interests – like everyone else does, including the members of the “general public”, who to my eye are quite eager to take advantage of the anti-capitalistic fare controls imposed by the government on yellow cab drivers (and I don’t see any proposal by Bloomberg to relax those price controls). Or, like you, to demand that a cabbie go where he might not want to.

We’ve created a monster with the current overregulated system, but if we propose as a solution removing the regulations that benefit cabbies while keeping those that benefit riders, we can’t say the drivers/medallion owners are being malicious for opposing it.

Bolwerk April 27, 2011 - 11:52 pm

Yeah, I agree with most of that, but my choice of terminology was deliberate: the medallions holders’ reasons are flimsy, not baseless, precisely because of what you describe. On balance, they lose few if any fares and keep the monopoly that accounts for something like 95% of their hails.* The people who are acting all but baselessly (and especially maliciously) are the politicians who should be the prevailing cooler heads looking out for and balancing the interests of everybody – at least that used to be their job.

I’m just “demanding” cabbies follow the rules they agreed to when they became cabbies, which includes taking people to the outer boroughs, Nassau, Westchester, and all the airports. I, for one, would be more than open to changing pricing regulations to be more in their favor if other stakeholders are considered too. I’m not especially open to arguments that harm a huge number of people in favor of the parochial interests of a small number of people.

Also, I don’t see anything terribly wrong with the regulatory model. An efficient transportation system demands consistency. People who hail a cab should have an expectation of consistent price, service quality, and reliability. You can’t make a case for unregulated capitalism in a public space like the streets, and I have a hard time imagining an unregulated model would produce a better outcome than the current, reasonably reliable system.

* You can bet much of the remaining 5% is airport trips and trips originating in a few lively outer borough spots.

tacony palmyra April 27, 2011 - 12:18 pm

** Well, most people don’t use “Outer Borough” to literally mean Outer Borough, but your use here is consistent with that idea. Washington Heights and Harlem are more “Outer Borough” than Brownstone Brooklyn in most senses, probably including availability of yellow cabs.

AlexB April 27, 2011 - 12:22 pm

I think cabbies are making things up or exaggerating when they say that outer borough trips are not profitable. These trips take longer and the meter is running the whole time, adding per minute and per mile. The problem is the cabbies aren’t very professional and many have no idea where things are in Brooklyn or how to get around. If you don’t know that Cobble Hill is not much farther that going to the Upper West Side, you won’t want to go.

Tsuyoshi April 27, 2011 - 12:38 pm

It mostly has to do with the return trip. You’re much more likely to find another fare on the UWS than Cobble Hill.

Larry Littlefield April 27, 2011 - 1:03 pm

The cabstand idea may work in some locations.

No taxi is going to want to drive around and around in Brooklyn looking for that rare street hail there. And no one is going to stand on the street in Brooklyn to try to hail a cab, waiting several weeks until one comes.

But if people would walk to a designated location and hit a button, alerting the closest cab that someone is waiting, that might work. Of course at that point, why not just call a car service?

Eric April 27, 2011 - 1:37 pm

Isn’t that a chicken and egg problem though? Cabs don’t bother looking for fares in the outer boroughs, so no one tries to hail them, so cabs don’t bother looking for fares in the outer boroughs, so no one tries to hail them, so cabs don’t bother…..

jim April 27, 2011 - 2:22 pm

If there aren’t enough cabs to provide service to the whole of the City, then the City should sell more medallions until there are.

pete April 27, 2011 - 10:43 pm

The city needs to sell medallions that are restricted to each borough and each airport. That way the few thousand dollar Brooklyn yellow taxis cant compete with the multi-million dollar Manhattan and airport yellow taxis, and they will go around Brooklyn looking for hails. If there are black liveries, there is a market for yellow taxis if they could only hail in that area.

Bolwerk April 27, 2011 - 11:55 pm

There may be a little demand for it, but that doesn’t mean there’s a sustainable market.

Anyway, the Bloomberg proposal was perfectly reasonable. It doesn’t need to be made more complicated by adding multiple layers of medallions. At most, there should be citywide and outer borough-only medallions. Anything more is just getting too complicated.

Al D April 27, 2011 - 2:22 pm

Talk about making a mountain out of mole hill. It’s simple. Just legalize, legitimize and standardize what is now happening illegally. If there were yellow cabs to service this market, well where are they? I don’t see yellow cabs cruisng for fares on many avenues, but the livery cabs do, honking and swerving and slowing down, negotiating a price. Just ridiculous.

Aaron April 27, 2011 - 2:39 pm

80 percent of New Yorkers live outside of Manhattan and deserve better cab service

I’m not normally a free-market guy, but do they? If there was a huge, pent-up and unserved demand for outer borough service, wouldn’t there be cabbies filling it instead of competing in the fairly saturated market below 96th St? I’ve occasionally wanted a cab in Brooklyn, but not nearly as often as Manhattan, and I suspect other people’s calculations are the same. Unless the City wants to create a public entity with salaries instead of fare-based compensation (and that’s not necessarily a bad idea), I don’t see how any solution works.

Chris April 27, 2011 - 3:54 pm

You’re missing that the supply of cabs is artificially limited to well below what the market could support. That’s why the right to operate a cab is worth seven figures. The market below 96th is not saturated, precisely because the number of cabs is limited such that it cannot be.

ferryboi April 27, 2011 - 3:31 pm

Funny how every other city in the US has city-wide cab service. You either hail a cab or call ahead and boom, there’s a cab. This isn’t rocket science, but like every other Goddamn thing in this filthy old town, it’s controlled by a handful of monied folks (medallion owners) who got theirs and don’t want to share.

Why the limite of 12,000 medallions for a city of 8 million? Make it 100,000 medallions and let cabs cruise wherever they want.

pete April 27, 2011 - 10:44 pm

You will see the number of “drive by shooting” at yellow taxis increase 10x if your proposal will happen.

JAzumah April 27, 2011 - 3:47 pm

There are street hails happening all over the outer boroughs. In addition, specific parts of Brooklyn and Queens have an epidemic of illegal cab and van operations that suppresses demand for legal options. The city can simply make street hails legal for livery vehicles outside of Manhattan, but that doesn’t generate revenue. Destroying the illegal transportation network WOULD generate revenue, but they do not want a strong commuter van industry, so they allow illegal cabs and vans to outnumber the legal ones four to one.

al April 27, 2011 - 11:25 pm

How about expanding call in pickup service. Hail liveries via a specialized text message (possibly with GPS). $2 fee to prevent crank callers. You can still call in via cell phone (or pay phone with HD security camera coverage) and give your location.

BrooklynBus April 27, 2011 - 5:28 pm

I bet this is the same reason why we don’t have any bus or shared ride services from the airports to major centers in the outer-boroughs. You can share a cheap van to go to Westchester but not anywhere in the five boroughs.

Alon Levy April 27, 2011 - 7:42 pm

Repeating my comment on Market Urbanism: this is more frustrating than some previous Bloomberg urbanism fails, in that it’s a case of incompetence rather than malice. That Bloomberg wasn’t going to offer free buses or urban rail service on the Lower Montauk Line was obvious; he was lying to get votes. But his failure to do something that would jive with his purported goals for remaking the city speaks volumes. He really is only that interested in pretty things he can put his name on.

The only saving grace would be if the compromise with the taxi drivers included a large increase in the number of medallions. I can’t give an over/under, but I’ll say raising the total from 12,000 to 20,000 would be enough, and raising it to 14,000 would not be.

Bolwerk April 28, 2011 - 12:01 am

Without some incentive to get cabbies to outer borough locations (GPS-driven smartphone hails?), more medallions probably only means more traffic in Manhattan, which is a bad idea while all these privately occupied vehicles are jamming up the place with their free market Suburbans and totally unsubsidized vehicle-miles on abundantly available and free public streets.

Alon Levy April 28, 2011 - 1:23 am

Could be, but it could also give cabbies an incentive to start roaming around Brooklyn and Queens more in search of more marginal fares.

Bolwerk April 28, 2011 - 12:00 pm

Maybe you’re right, but that should be easy to figure out. What is the cost per fare when you “roam” around Brooklyn and Queens? Probably significantly higher than Manhattan, given all the same labor, fuel and wear and tear costs are there as in Manhattan, but a typical ride is significantly less frequent.

My guess: fares don’t cover overhead, no matter how many medallions are out there.

Alon Levy April 28, 2011 - 12:38 pm

I don’t know. It heavily depends on which part of Brooklyn and Queens. My only data point is that when I got off the subway on QB in Forest Hills, it took me less than a minute to find a taxi. (And it took the taxi about 13 minutes to get to the airport, making E+cab by far the fastest option from Manhattan to JFK).

Bolwerk April 28, 2011 - 1:22 pm

This was a yellow cab? FWIW, I always found it easy to get cabs in Astoria, the Bedford Ave. area in Williamsburg, and the Prospect Park area. I don’t know how easy it is for them to find fares though. These are probably all areas where people go to the city to get drunk/laid by train, and come back drunk/unlaid by cab.

But that’s not very very helpful information. I know you can find cabs in the outer boroughs, probably precisely because of the airports. When I lived in Clinton Hill (Myrtle/Classon area – I guess that’s Clinton Hill), I used to walk a block or so into Williamsburg and catch them entering the BQE. Many would refuse rides because they wanted to go back to the airport (dicks). But cabbies probably have little promise of a return fare in any outer borough location.

Alon Levy April 28, 2011 - 6:27 pm

Yellow cab.

Staten Islander April 27, 2011 - 11:09 pm

Benjamin, just quick comment, why is Staten Island never included in your definition of outer boroughs? Makes me feel a bit of a second-rate citizen……

Benjamin Kabak April 27, 2011 - 11:11 pm

A valid question. How often do yellow cabs go to SI?

Bolwerk April 28, 2011 - 12:01 am

I saw a bunch parked on the North Shore last time I was there. Reckon they lived there….

For taxis, a plan to limit medallions to the Outer Boroughs :: Second Ave. Sagas April 28, 2011 - 12:18 pm

[…] Mayor Bloomberg’s plan to allow livery cabs to pick up cruise for passengers hitting a bump in the road, yet another of his campaign promises to improve transportation in the city may falter. Yesterday, […]

Alon Levy April 28, 2011 - 12:36 pm

A different thought: if this is bundled with allowing fares to increase, it can be sold to the public as raising fares on tourists in order to improve taxi service to Real New Yorkers.

A Mayor leaving transit riders out in the cold :: Second Ave. Sagas April 29, 2011 - 1:19 am

[…] that the Mayor’s plan to allow livery cab drivers to pick up passengers in Outer Borough was to be torpedoed by the taxi industry, Michael Bloomberg suffered yet another political defeat of a transit promise made during his 2009 […]

Jay June 6, 2011 - 9:35 am

The plan is simpler than Carpet Bagger Bloomberg wants to make it…Reverse the allowance than Guiliani put into place to allow Gypsy or Livery Cabs to pick up fares in between 96th and 23rd …or whatever … THis was only put into place during a cab strike during his tenure and was never reversed..


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