Career taxicab drivers are now being forced to buy taxicab medallions, rather than earning and receiving them for a one-time nominal fee. In recent years, the value of a medallion has dropped like a stone while the medallion price set by the San Francisco Municipal Transportation Agency has remained the same. Medallion transfers (purchases) have slowed to a trickle. For these reasons, the SFMTA should be responsive to market conditions and lower the medallion transfer price.
When I put my name on the taxicab medallion waiting list in 1998, I agreed to a deal whereby when my name got to the top of the list, I would be granted a taxicab medallion for a one-time fee of maybe a couple of thousand dollars. Once granted, I would take that medallion to the taxicab company of my choice and from there on out receive checks in the amount of about $2,300 per month for as long as I held the medallion. This was to be on top of whatever I made driving the cab. When I retired from the industry, the medallion was to go back to The City. That was a profit-sharing program, which provides for a middle class. That lets working-class people buy houses, raise kids and put them through college. It was a situation that provided working-class people with a secure financial future.
Then came the SFMTA’s medallion sales programs. Without being given an opt-out, the SFMTA changed the terms of my agreement without my consent. No longer could I earn a medallion for a one-time fee. Now I am forced to buy a medallion for $250,000 with a minimum down payment of $12,500 and about a 5 percent interest rate to pay off the rest over 30 years. Sure, I get to sell it when I’m done with it, but I need money now and, under the former deal, I could save for my future. As it stands now, I can forget about raising kids properly or buying a house.
Not only that, but in the meantime The City has allowed Uber and the other Transportation Network Companies to suck most of the profits out of the taxicab industry. Now that it’s time for me to get my medallion, there are hardly any profits to share.
Taxicab companies have had to drastically lower the amount of monthly medallion holder payments. In many cases, the monthly checks made out to medallion holders have fallen below the monthly amounts those medallion holders must pay to pay off their medallion.
What was once something that provided a present and a future for working-class people is now an albatross around the neck. As long as the TNCs are allowed to operate, they will continue to devalue taxicab medallions. Although the SFMTA does not report any medallion loan defaults yet, these are sure to happen as long as Uber is allowed to operate and continue sucking the profits out of our industry. One can see how this might give potential medallion purchasers pause.
While the value of a medallion has fallen precipitously, the price has remained at $250,000 since the medallion sales programs started in 2010. The number of taxicab medallion transfers have slowed almost to a standstill. Market conditions demand the SFMTA go about lowering the medallion transfer price. It would be a good turn for taxicab drivers and the SFMTA.
On Tuesday, I will address the SFMTA board at its regular meeting and ask Director of Transportation Ed Reiskin to initiate the process of lowering the medallion transfer price. I will be suggesting a price between $125,000 and $150,000. If you agree, please show up and voice your support. Thank you.
Peter A. Kirby is a cab driver in San Francisco.