Judge deals a potentially fatal blow to Bloomberg’s ‘borough taxi’ plan

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On Friday evening, New York State Acting Supreme Court Justice and former cabbie Arthur Engoron dealt a potentially fatal blow to Mayor Michael Bloomberg’s ambitious “borough taxi” plan.

Just days before New York City’s Taxi and Limousine Commission was to issue its first licenses for a new fleet of lime-green taxis that would provide street-hail service to the outer boroughs, Engoron issued a temporary injunction and impled it would be a permanent one.

Engoron wrote that “plaintiffs are likely to succeed” on their claims that the state borough taxi law, signed by Governor Andrew Cuomo in February, violates the state constitution.

The law, based on a compromise hammered out in December, would have created a new, 18,000-strong fleet of taxis empowered to pick up street hails in the outer boroughs and upper Manhattan. The law also would have allowed the city to auction off 2,000 regular yellow taxi medallions and use the resulting revenue to plug  a $1 billion hole in the city’s 2013 fiscal year budget.

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Further, those 2,000 yellow taxi medallions were expressly reserved for wheelchair accessible vehicles, of which there is a severe shortage in New York City. Only 232 of the more than 13,000 taxis in New York accomodate wheelchairs.

But rather than seek approval of the City Council for the new taxis, as the city has done in the past, the Bloomberg administration went straight to the state legislature.

“This Court has trouble seeing how the provision of taxi service in New York City is a matter that can be wrenched from the hands of City government, where it has resided for some 75 years, and handed over to the State,” wrote the judge.

“As the [Taxicab Service Association] plaintiffs put it (Memorandum of Law dated 5/17/12, at 7), ‘the Street Hail Livery Law infringes on Plaintiffs’ constitutionally guaranteed right to have their local government representatives decide issues relating to the local taxi industry, in which they are longtime and central participants,’” he added.

The judge was responding to three separate lawsuits by medallion owners and medallion underwriters: the Metropolitan Taxicab Board of Trade, the Greater New York Taxi Association, and the Taxicab Service Association, all of whom argued that the law violated the constitution and that it undermined the street-hail exclusivity upon which the million-dollar value of their medallions was based.

Public Advocate Bill de Blasio later filed an amicus brief in one of the suits, siding with the medallion owners, a challenge Bloomberg described Friday morning as "the stupidest one" he'd seen.

Today, following the news of the injunction, de Blasio issued a gloating statement.

“This morning Mayor Bloomberg threw mud at his critics and slammed this lawsuit as ‘stupid,’" he said. "Justice Engoron of the New York State Supreme Court proved him wrong. This is what happens when you make an end-run around democracy. The Mayor has time to get this plan right—but he needs to work within the law, and with the City Council, to do it.”

In another statement, a spokesman for the MTBOT said, "By preventing the Taxi and Limousine Commission from issuing any outer borough street hail permits, the Court has prevented a trampling of the New York State Constitution as well as an economic disaster for more than 5,000 individual taxi driver-owners and thousands more taxi owners and cabbies who invested their life savings into what they regarded as the American Dream—the taxi medallion."

The city, meanwhile, promised to appeal.

“We are deeply disappointed by today's decision,” said Michael Cardozo, the city’s corporation counsel, in a statement. “We think the court was mistaken in its analysis and are exploring our appellate options. We intend to so do expeditiously, so that we can proceed with this important new initiative. The program is geared to providing improved transportation options to segments of the City which are now woefully underserved. In addition, because we are enjoined from issuing additional medallions, we are prevented from proceeding with a program which will provide significant benefits to the disabled and garner the City approximately $1 billion in critically needed revenues."

In a separate statement, Taxi and Limousine Commissioner David Yassky said, "This last-minute delay is very unfortunate. We share the disappointment of the 80 percent of New Yorkers who live and work outside of Manhattan and are waiting for safe, legal and reliable taxi service, as well as the thousands of hard working livery drivers who stand ready to provide that service. We are also concerned about the budget risks of delaying the sale of 2,000 new wheelchair accessible taxi medallions."