Cuomo collects his share of a Bloomberg project, and now outer-borough New York will have taxis, too

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A taxi in Sunnyside. (chrisgoldny via flickr)
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Following nearly a year of debate, and months of public equivocation, Governor Andrew Cuomo will today sign a version of Mayor Michael Bloomberg’s outer-borough taxi plan, one that gives significantly more accessibility to the wheelchair-bound than originally planned, and significantly fewer outer-borough taxis to New York City.

The fact that the governor has agreed to sign the legislation at all is more than some interested observers expected.

“I'm away so haven't seen it but I'm hearing there will be many lawsuits,” said Andrew Murstein, the chairman and C.E.O. of Medallion Financial, which is in the lucrative business of underwriting the sale of taxi medallions, and whose sector of the industry fiercely opposes the measure. The governor’s father, Mario Cuomo, sits on the company’s board.

Yesterday afternoon, at around 5 p.m., a compromise was reached. Twenty minutes later, the governor’s office sent word that at 5:45 he would reveal the agreement at a press conference on the second floor of the state Capitol. The mayor would participate by phone. Bloomberg’s taxi and limousine commissioner, David Yassky, who’d been on the second floor since noon negotiating the agreement, would participate in person.

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At the event in the governor’s Red Room, the governor revealed the outlines of the deal. He cast it as a victory for the disabled, which it is.

“It’s very important to me that the bill is something I’m proud of and that all New Yorkers can be proud of, and I don’t believe New Yorkers want a taxi system that is not accessible, period,” he said.

The mayor, participating by phone, called it “a huge victory for all New Yorkers.”

The compromise, watered down though it may be, is still a big win for the mayor, even if it's a conditional one. It was he who, in his January State of the City address on Staten Island, floated the idea of a borough-taxi system that would address one of the longer-standing idiosyncrasies in New York City law: Though yellow taxis rarely service most of the city outside of Manhattan, it has been illegal for the black livery cars that do service the outer boroughs to pick up hails off the street. They could only respond to prearranged calls. That did little to stop drivers and their patrons from taking part in what was essentially a black-market, cash-only system, with all the risks attending an activity that is illegal and unregulated.

“Why shouldn’t someone in the Bronx, Brooklyn, Queens, or Staten Island be able to hail a legal cab on the street?” asked the mayor in January.

He promised, “This year, we’ll establish a new category of livery cars that can make on-street pickups outside of Manhattan.”

In June, the state legislature approved a bill based on the mayor’s plan by large majorities in both houses. It would have allowed up to 30,000 so-called “borough taxis” to work the streets of Brooklyn, Queens, Staten Island and the Bronx, as well as Upper Manhattan, north of 96th Street on the east side and 110th Street on the west.

As in the central business district, the airport would be off-limits to borough taxis for anything but prearranged service.

The permits would have been made available to members of the livery industry at the relatively affordable price of $1,500, and would last three years. The mayor and his supporters cast the plan as a boon to outer-borough New Yorkers and livery-car drivers alike.

The bill would also have helped the city manage what's expected to be a $2 billion budget deficit in 2013 by allowing the sale of an additional 1,500 regular yellow-taxi medallions. Medallions have sold for $1 million a piece, and the sale of the new one was projected by the city to garner more than $1 billion.

The problem was the governor. Though the legislation had already passed the Assembly and Senate, Cuomo was refusing to sign it and was indicating that, absent unspecified modifications to the text, he wouldn’t. In September, he said support for the bill he had been criticizing appeared to be “dissipating.”

In a statement put out in October, ahead of a taxi summit held in his New York City offices the following month, the governor said, “The optimum goal is to design a plan that provides taxi access to the outer boroughs, access to the disabled, revenue for the city, and respects the medallion franchise. We are working to fashion a plan that fairly balances those goals. I will not approve a plan that doesn't.”

The opposition that appeared to be wielding so much influence over Cuomo was, in its make-up, unusual. Of course, the yellow-taxi medallion owners, many of them multimillionaires with substantial political heft and a team of lobbyists including former senator Al D’Amato, opposed the legislation. So did the financiers that underwrite medallion sales. Both feared the new borough taxis and the new regular taxis would flood the market and dilute the value of their assets. They also questioned the city’s ability to enforce the boundaries of the central business district.

Some livery-company owners also opposed the measure, arguing that drivers, eager to take advantage of the new street-hail privileges, would abandon the pre-arranged business altogether. (Of course, yellow cabs don’t service the rest of the city precisely because it is too difficult to make a living in those neighborhoods relying only on street hails.)

Advocates for the disabled, normally foes of the aforementioned groups, comprised the final piece of the opposition. Their complaints proved the most compelling—only 232 of the city’s more than 13,000 taxis are wheelchair-accessible. The city’s new Taxi of Tomorrow—a vehicle that will standardize the taxi fleet—can't accommodate wheelchairs. And so an alliance was born: medallion owners found a useful cause in the wheelchair-accessibility issue, and disabled advocates were able to enlist the medallion owners’ institutional weight.

“It’s hard for me to be critical of the advocates—it’s such a compelling issue,” Bhairavi Desai, executive director of the Taxi Workers Alliance and a supporter of the Bloomberg taxi plan, told me in October. “But there’s no question in my mind that this is sheer opportunism. The fleets' interest is solely to increase their hold on the industry and maximize their profits, and they are trying to put a good face on it by saying, ‘We’re working with disability advocates.'”

While some taxi drivers also opposed the legislation, fearing the potential competition, Desai, who represents the closest thing taxi drivers have to a union, supported it once she got assurances from the city that it would provide sufficient enforcement of the central business district boundaries.

So did a number of livery companies, and, of course, the livery drivers themselves.

Finally, last week, a compromise seemed nigh. In the flurry of activity preceding the special session that produced the governor's major tax-code overhaul, pretty much everyone involved with the taxi issue (except, notably, Cuomo) arrived at the impression that a compromise version of the bill would come up for a vote. The compromise called for reducing the number of borough-taxi permits from 30,000 to 17,000 and making 2,000 of them wheelchair-accessible. It also called for making all of the regular yellow medallions accessible.

But at the last minute, the governor reportedly realized that he could still use the taxi legislation as leverage in his negotiations with the mayor on other issues. Whether it was that or something else, the compromise was abandoned by the governor with no immediate explanation.

The Assembly responded by sending the original legislation, the bill that it and the Senate passed in June, to the governor’s desk anyway. Because of arcane rules regarding such matters, that move essentially forced the governor’s hand, requiring him to veto the bill by Dec. 21, today, or it would automatically become law.

The following week, the governor held yet another summit of lobbyists and policy-makers in his Capitol offices. In the meeting, he made a show of asking Yassky, the mayor’s taxi commissioner, pointed questions about wheelchair accessibility. In the much smaller meeting following that one, he asked Yassky to return to him with new accessibility provisions. Namely, he wanted to make sure that there were enough incentives in place to ensure that the borough taxi permits that required wheelchair accessibility would be sold, given the expenses involved in converting a car into one that can accommodate wheelchairs.

On Tuesday, Cuomo revealed his grand compromise. Like the one reached last week before it was abandoned by the governor, it reduces the number of borough-taxi permits by about half, in this case to 18,000. Like the compromise reached last week, it makes a bunch of them wheelchair-accessible: 3,600 of them (up slightly from the 2,000 included in last week’s compromise bill). Also like last week’s compromise, all of the regular taxi medallions will be wheelchair-accessible and there will be 2,000 of them.

The increase over the June legislation’s 1,500 was made with the idea the city can use the proceeds from the sale of the 500 extra medallion sales to provide $15,000 tax-credits to car owners who want to retrofit their vehicles to make them wheelchair-accessible.

Unlike last week’s compromise, the current agreement calls for the borough-taxi permits to be meted out slowly: 6,000 in the first year, another 6,000 the next, and the final 6,000 in the third year. That’s apparently a concession to medallion owners’ concerns that the influx of borough taxis would dilute the value of their assets.

Also unlike last week’s compromise—and this is perhaps the agreement’s most significant difference—the governor has given himself substantially more control over New York City’s taxi industry. Once the first 400 of the yellow taxi medallions are sold, the city has to submit a plan for the phasing-in of complete accessibility for the city’ s taxi and limousine industry. If the plan does not meet the expectations of the governor, the city cannot sell the rest of the medallions.

Theoretically, the governor could use that leverage to bend the city to his will on all sorts of things. He could conceivably even use that leverage to force the city to find a new Taxi of Tomorrow that is actually wheelchair-accessible, if he wished.

Negotiators worked late into the night on Tuesday hammering out the final details of an ammendment. Today, the governor will sign the bill passed in June with a handshake agreement that the legislature will approve the amendment in its next session, in 2012. That means that by June at the latest, the city's outer boroughs will have taxis, for real.

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