San Diego Free Press | Taxi Medallions: San Diego’s Licensing Program for Exploiting Immigrants

By Doug Porter

While lots of local politicos are willing to give at least lip service towards increasing the minimum wage or creating affordable housing, the abject lack of interest in rectifying a government sponsored system of exploitation in the local taxi industry is staggering.

The medallion based system of licensing currently in place in San Diego, wherein drivers pay for the privilege of leasing a vehicle that may or may not be roadworthy, insures consumers of two things: scarcity of service and higher fares. This form of regulation might have made sense 80 years ago in New York city when it was started, but today a privileged few and the politicians they fund are the only beneficiaries.

Of all things revealed in a 2013 San Diego State University/Center for Policy Initiatives study–the unsafe working conditions, the dangerous vehicles, the exploitation of drivers–it would appear that Mayor Kevin Faulconer’s response will be limited to the vehicles themselves and, perhaps, record keeping issues.

From a KPBS report last May:

At the crux of driver unrest is an unregulated market in which individuals pay high prices to operate cab companies and lease cars to drivers.

The permits, often called medallions, go for as much as $140,000, according to the report. The permits are similar to liquor licenses; they’re granted by a public agency and come with regulation. But unlike liquor licenses, the sale of taxi permits in San Diego has not resulted in income for the public. Buyers pay a nominal administrative fee to MTS to transfer the permit, but the larger transaction happens behind closed doors, typically in cash.

The sales do not violate local taxi ordinances. Taxi union representatives stop short of calling the dealings an illegal black market, but say they create a system that exploits drivers, who are often immigrants and refugees.

In the wake of the SDSU/CPI study last year, then-Mayor Bob Filner declined to renew the city’s five-year via the Metropolitan Transit System contract overseeing the taxicab industry, issuing a one-year extension and identifying funding for a study on whether the city should take over regulating the permitting system.

That idea went down the tubes along with a lot of other initiatives as his administration imploded. According to a story in this week’sCity Beat, the industry’s response to this threat to the status quo was to urge the medallion owners connected with the newly formed San Diego Transportation Association to start charging cabdrivers a $10 a month fee to pay for a lobbyist. Oh, and they wanted to make sure and crush the United Taxi Workers of San Diego.

From the City Beat article, which has lots of what should be eye-opening information:

After Filner resigned in disgrace last year, City Council President Todd Gloria became interim mayor and put the study on ice, telling MTS the city would renew its long-term contract.

“I understand that some drivers agree to leases that are beyond what may be reasonable, and that vehicle and driver safety is a concern,” Gloria said in an email to CityBeat.

“Unfortunately, the study that was suggested by my predecessor wouldn’t have addressed those items. Developing regulations to actually improve the industry instead of fighting over who will oversee those regulations that haven’t been written would be more productive. “

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