2:30 pm Oct. 2, 20123
On Friday the Greater New York Taxi Association, which represents some of the city's wealthiest taxi medallion owners, and Evgeny Freidman, one such owner, sued Mayor Michael Bloomberg's Taxi and Limousine Commission, alleging, among other things, that it and the Taxi Workers Alliance (the closest thing taxi drivers have to a union) reached "a corrupt, surreptitious agreement" designed, in part, to retaliate against taxi owners.
Here's the suit, first reported by the New York Post, in full.
In particular, the Association and Freidman allege that the city agreed to give taxi drivers—as represented by Alliance executive director Bhairavi Desai—a fare hike, lower credit card transaction fees, and a disability fund in exchange for their support of the mayor's ambitious borough taxi plan.
The drivers did indeed recently win a fare hike, limits on credit card transaction fees, and a disability fund. And the drivers did also support the mayor's borough taxi plan.
But the plan, which would have empowered 18,000 livery car drivers to pick up street hails in the outer boroughs and upper Manhattan, something they routinely do now illegally, is held up in court.
In the drivers' support for that plan, and the commissioner's support of rules improving drivers' lives, the owners see only vindictiveness and collusion.
“These illegal actions are all part of a concerted plan concocted by Mayor Michael Bloomberg (“the Mayor”) and Yassky to severely and recklessly diminish the value of taxi medallions for no reason other than to retaliate against medallion owners who successfully challenged the Mayor’s previous illegal plans," the suit reads. "They are also the direct result of a secret deal the TLC made with an alliance of taxi drivers to gain the drivers’ support for a piece of legislation that has now been found to be unconstitutional.”
Here's the suit's evidence: in March 2011, Desai opposed the city's plan to create a new fleet of taxis to service the outer boroughs, long neglected by the yellow cab industry. Three months later, she came out in support of the measure, and in a newsletter to alliance members told them, according to the suit, that she was supporting the plan because the TLC had agreed to a fare hike, lower credit card fees and the creation of a health care fund.
"Secret" is a subjective term, maybe, but it should be noted that Desai wrote about it in a newsletter, and discussed aspects of the agreement at a press conference.
Desai, in an interview with Capital, called the suit's allegations, "absurd."
"We haven't had an overall raise in eight years," said Desai. "Gas prices have gone up four dollars, from $1.80 to over $4 in that time period. And how is creating a health and disability fund for low-income workers retaliation against the owners? They don't even have to pay for it."
According to the suit, the TLC was angry that the industry has succeeded in foiling new rules designed to encourage the use of hybrid cabs, and other rules designed to shift the burden of sales tax payments from drivers to medallion owners.
"There is no other reason to explain why every penny of the recent 17% fare increase went exclusively to the drivers, while the taxi owners’ income was simultaneously reduced by the rule changes,” according to the owners.
There are, actually, good reasons why the 17 percent fare increase went to the drivers, and only the drivers.
Unlike medallion owners, who control million-dollar assets, taxi drivers operate in what one Times reported recently described as a "feudal" state.
In other words, they could really use the extra cash.
The suit also argues, somewhat outlandishly, that the replacement of the word "Taxi" with the letter "T" on the exterior of yellow cabs was designed to, "end distinctions between yellow medallion cabs and livery cabs in what appears to be an effort to confuse customers."
In other words, should the borough taxi law ultimately come into effect, riders will no longer be able to distinguish lime-green borough taxis from yellow yellow cabs.
"Even though only yellow cabs can legally pick up hails in Manhattan, consumers would not have been able to differentiate between the two types of cars and the services they can legally provide,” the suit argues, dismissing the difference between the still-aspirational lime-green borough taxis and the bright yellow regular taxis, as "a slight difference in color; a difference that almost completely vanishes at night under the City’s street lights."
Further, the suit argues that the commission has no authority to set up a disability health fund for taxi drivers, derived from a $.06-per-ride surcharge.
"This is pure petty arrogance that they cannot stand the idea that people at CIty Hall are listening to the plight of taxi drivers," said Desai, who said the Alliance will be participating in the lawsuit in some form. "That's it. There's nothing more to it than that."
In reaction to the suit, city Taxi and Limousine commissioner David Yassky said, “I haven’t read a good John Grisham novel in a while, so it fills that void."
Even if the economics justify the prices of medallions, the skyrocketing prices of the past decade is still mind boggling.
I am somewhat shocked at the one-sidedness of Ms. Rubinstein's article (opinion piece?). She has made absolutely no effort to present the other side of this argument, and is seemingly content in reporting Ms. Desai's dubious excuses as fact. I would ask what the rebuttals from medallion owner were to Ms. Desai's claims, but it seems pretty clear that Ms. Rubinstein has sought none.
Furthermore, instead of looking to verify claims made in the suit, Ms. Rubinstein chooses to turn her article into a soapbox, going on at length about how taxi drivers deserve more money, (not exactly a controversial opinion in any quarter of the NYC taxi industry,) while making the same tired arguments about the "million-dollar assets" of medallion owners. Of course, if she had done even the slightest bit of research into the workings of the industry, she would've learned almost immediately that those "assets" are only worth a million dollars if sold, and do not generate any income in and of themselves. In fact, medallion owners are required by law to charge a capped lease fee, which cannot be exceeded under penalty of agent license revocation, and that this cap has not gone up in over eight years--or since the last time drivers got an overall fare increase.
This information is not secret. It is not classified by the TLC, or anything equally ridiculous. It is there for any reporter worth her salt to find, and it is no more than one phone call to the Commission away. But Ms. Rubinstein couldn't be bothered to make that call, just as she couldn't be bothered to contact anyone who might support this suit. That would've muddied her clear "working-man-vs.-fat-cat" story line, and may have caused some of her readers to think for themselves. Instead, she has written this sloppy, subjective article and tried to pass it off as news. It reflects poorly on her as a reporter, and on Capital New York as a whole.
I too am confused by the obvious bias in this piece. Maybe it's supposed to be read as satire since it opens with how rich the medallion owners are but makes no mentions of how our billionaire mayor used his own capital to bribe[donate] to certain members of the city council. I'm not a reporter myself but in every journalism course I've ever taken in college we were specifically instructed never to show such extreme bias and interject phrases like Ms. Rubinstein has: "somewhat outlandishly" or "'Secret' is a subjective term, maybe". Perhaps it would do Ms. Rubinstein herself some good to go back to school and brush up on the difference between an opinion piece, an editorial, and an actual news article. I'd also be interested in hearing about Ms. Desai's credentials. I've not read anywhere that she ever was a taxi driver herself or who actually voted her in as head of this union so I'm interested to hear exactly how she knows much about the inner workings of this industry and how she created her own way to the top. It could be an inspirational piece, how to create your own job and business in a tough economy. Perhaps when Ms. Rubinstein completes a few journalism courses at CUNY she can investigate that next.