Judge declares Bloomberg’s borough taxi law ‘null and void’

Black car and yellow taxi. (Jason Kuffer, via flickr)
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Mayor Michael Bloomberg's plan to bring taxi service to the outer boroughs took a severe beating Friday afternoon, when acting Manhattan Supreme Court Justice Arthur Engoron issued an opinion declaring the mayor's hard-won borough taxi law "null and void," citing, among other things, the administration's failure to first attain City Council approval before repairing to Albany.

The decision means the city cannot move forward with its plan, pending an appeal to a higher court.

"The City is up to the task of regulating its own taxicabs," wrote Engoron.

At issue is a law, passed in February, allowing New York City to create a new fleet of 18,000 lime-green "borough taxis" to service the outer boroughs and Upper Manhattan, where regular yellow cab service is a rarity.

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That same bill also allowed the city to auction off 2,000 wheelchair-accessible yellow cab medallions, which were expected to garner more than $1 billion for the city's budget and also vastly improve the fleet's ability to serve passengers in wheelchairs. As the fleet now stands, there are only 233 wheelchair-accessible yellow cabs.

The city needs Albany approval to issue new medallions, so at first, following standard protocol, the city sought City Council approval for the measure, so it could then bring what's known as a "home rule" request to Albany.

The decision cites these excerpts from a January 18, 2011 email from Taxi and Limousine Commissioner David Yassky describing the city's strategy:

"Tomorrow, Mayor Bloomberg is delivering his annual ‘State of the City’ speech [in which] he will propose that livery cars should be able to accept street hails [under certain circumstances].”  Further, “there will be a full legislative process on this (it requires City Council approval), and … I expect the City Council may seek [some changes]."

The powerful yellow taxi industry, however, was desperately opposed to the measure, and argued that the new "borough taxis" would both violate their exclusive street-hail privileges and dilute the million-dollar value of their medallions.

The City Council, likely under the heavy influence of the wealthy taxi industry's well-recompensed lobbyists, did not take to the mayor's plan and did not issue a home rule message.

And so Mayor Bloomberg went to Albany instead. That, says Engoron, was a fatal error.

"Interestingly, the subject legislation appears to be the first instance in which the State Legislature passed a law without a home rule message after having passed laws on the very same subject with a home rule messages," he writes.

This spring, the industry filed three separate lawsuits against the borough taxi law, all arguing that the law undermined their street-hail privileges and violated the City Council's right to govern city affairs. Engoron decided to hear them together.

Public Advocate Bill de Blasio, who's running for mayor in 2013 and has received substantial campaign donations from the yellow cab industry, filed an amicus brief on their behalf.

The mayor, in turn, called de Blasio's challenge "the stupidest one" of them all.

Manhattan Borough President Scott Stringer, who's also running for mayor next year, sided with the city.

On June 1, Engoron issued a temporary injunction halting implementation of the plan, pending his final decision, which came today.

In it, he's dismissive of the city's claim that the borough taxi law is indeed a state, rather than a local interest.

The city has argued that not only do many New York State (not just city) residents rely on taxis when they come to the city, but because taxis are intrinsic to the city's economy, and the city's to the state's, that taxis are indeed a state concern.

In Friday's opinion, Engoron skewered that argument.

"If every cross-border transaction or out of town trip to the theater district created a substantial State interest, the borders might as well be abolished, and the State can just run everything.  Occasional trips across the periphery of New York City cannot justify the State Legislature in driving a stake through the heart of home rule."

"The contents of the subject legislation are all New York City 'stuff,'" Engoron continued. "The new medallioned taxicabs and [borough taxis] would be picking up passengers, and almost always dropping them off, in New York City. The Mayor, the TLC, the City Council, are all components of New York City government. The new medallions and licenses would be auctioned or sold by the City, for the City’s financial benefit.  The City is up to the task of regulating its own taxicabs."

Engoron declared the act "null and void," but the city plans to appeal.

"We are deeply disappointed by the Court's decision, and will be filing an immediate appeal," said the city's corporation counsel, Michael Cardozo, in a statement. "We are confident that the appellate court will uphold the state law authorizing two important transportation initiatives: providing safe and reliable hail service by liveries in areas of the City rarely served by yellow taxicabs, and providing 2,000 more wheelchair-accessible yellow taxicabs for disabled passengers. The irrational fear of lost profits by medallion owners and lenders should not be permitted to derail these important programs."

Stringer, in a statement, encouraged, "all stakeholders—from the yellow cab industry to livery operators to community leaders—to get back to the negotiating table immediately."