The Pilot Plan: What it is. What it isn't - Unfair???

There has been so much misinformation written in the press and disinformation spread about the Taxi Town Hall Meetings that I think it's necessary to review what went on there.

There have been two main attacks leveled against the meetings: that they were unfair and that the outcome was fixed or predetermined.

The first assertion is ridiculous and the second is false.

1. Aside from the famous 175 hours of meetings, there were at least twenty presentations given and anybody who had a thought or a question was encouraged to speak. Mark Gruberg of the UTW, the main critic of the meetings, not only spoke for three or four hours all by himself but his idea for a "driver's fund" is now part of the plan. Furthermore, Director of Taxis Chris Hayashi went far beyond the normal call of duty and talked with taxi drivers at the airport, at cab lots and anywhere else she could find them.

2. I think that these meetings were supposed to be fixed. They were supposed to be the usual dog and pony shows designed to manufacture consent. Only, thanks to Hayashi, they were not.

• This is the plan that was supposed to be shoveled down our throats. It comes from Malcom Heinicke, a director of the MTA board.
• This is an outline of the Pilot Plan we developed at the Town Hall Meetings. (The final version is still being drafted.)

Those of us who took part in these meetings know how absurd these attacks against the Town Hall process are. We sat and watched the plan being drawn up from scratch on a blank slate. Chris Hayashi started out by asking the people at the meetings what they thought should go into the plan and then wrote in the suggestions.

Over a period of four months, the plan constantly changed and evolved as people debated various points or came up with a fresh ideas. The plan remains a work in progress and will be subject to change even after it is accepted by the MTA. The final version won't be drawn up until we see how the various parts of this pilot program - like the fixed-priced sale of taxis - play out in the real world.

I doubt that workers from any industry of any kind have ever been given the chance express themselves more freely, openly, thoroughly and, yes, fairly than the people at these meetings. I think that few groups of people have ever had more say in reforming the future of their business.

Currently, Hayashi is working to find the best financing possible for the drivers who might want to buy a medallion under the new plan. She's decided to hold a Town Hall Meeting for all the banks and lending institutions that are interested - on Friday, February 12th from 2pm to 5pm.

I asked her if it was okay if I attended.

"Of course," she told me, "It'll be open to the public. We don't do anything in secret around here."

My Response to the SF Weekly

Here's my response to Chris Roberts the writer of "Cabbies cry foul over plan to sell medallions" which appeared in the SF Weekly. (I've edited it slightly for this post.)

As a San Francisco cab driver and medallion holder, I think this article is a poor example of journalism.

1. The claim that the majority of drivers are against this plan is false.

2. This plan is a response to Mayor Newsom's threat to take all the medallions away from San Francisco's cab drivers and sell them at open auctions for $600 million.

3. This is not an MTA plan or a taxi company plan. It is a mediated compromise plan created over a period of 6 months by all interested parties including: the MTA, cab companies, public representatives, medallion holding drivers, drivers on the waiting list to own a medallion and regular drivers.

4. The majority of people who made this plan are cab drivers. Almost every provision in it is a compromise among these groups.

5. For instance; The $11.2 million to be derived from the sale of medallions is less than the the $600 million the Mayor wanted or the $30 million MTA tried to get last year. $4 or $5 million of this will probably be put back into the industry to build infrastructure and improve service.

6. The sale of medallions will be limited to the medallions of a few holders over 70 years of age as a way to let them get out of the business without dumping them on the street.

7. The price is not set at $250 thousand. This fixed price sale is a negotiation between drivers who wanted open auctions and those didn't want medallions sold. The final price will be determined by whether or not an average working driver can afford to make payments.

8. Most medallions will continue to be given out for "free" to people on the waiting list on a first come first serve basis. The drivers on the list will also be given the first choice to buy medallions if they choose to do so.

9. A Driver's Fund will be set up for the benefit of non-medallion holding drivers - hopefully to help them retire. It will be funded by the sale of the medallions - among other things.

Chris Roberts, the writer of the SF Weekly article, did as sloppy a job of journalism as I've ever seen.

1. He got most of information and his "slant" from the UTW - A group that stonewalled the Town Hall Meeting where the plan was created and have been running a "disinformation" campaign ever since.

2. He did NOT interview Barry Korengold, head of the San Francisco Cab Drivers Association - a group made of medallion holders and regular drivers. It probably has more drivers on the waiting list than any other group. Korengold spoke in favor or the plan.

3. NOR did he interview Carl Macmurdo of the Medallion Holders Association who also spoke in favor of the plan before the MTA board meeting that Francis was supposed to have covered.

4. He did interview me and he quoted me more or less accurately but he quoted me totally out of context.

5. I gave him three or four reason why I supported the plan. Except for mentioning that I backed it because it helped older drivers retire, he basically ignored what I had to say and chose instead to quote my one reservation about the plan - placing my quote in the 2nd most powerful position of his article, the end.

6. He neglected to do even the most basic research about the business. At the time he filed his article, he didn't even know what the function of a medallion really was.

7. Most egregious - he did NOT interview the MTA's Deputy Director of Taxis, Chris Hayashi, who is the person that negotiated the plan between the various factions. Roberts neglected to interview Hayashi even AFTER I told him that she knew more about the taxi business than anybody else in city government. She's also the most accessible person in city government. She will talk to anybody who calls - especially a writer.

All in all a poorly researched piece by Roberts: A disservice to all the people who worked so hard to put the taxi reform plan together and to the public who deserve to know what the plan is really about.

MTA Board Tells Hayashi - "Yes"

The MTA Board gave their unanimous vocal approval to the plan that Director Chris Hayashi outlined for them yesterday.

The experimental plan calls for the limited fixed-rate sale of taxis by medallion holders over 70, the preservation of The List, the one-time sale of 60 taxis to raise $15 million for the MTA and the establishment of a driver's fund - among other things.

It was a contentious meeting with the UTW bringing out it's troops in force to attack the plan. The proposal was also dissed by numerous others. Many of these dissenters had attended few, if any, of the 175 hours of Town Hall Meetings and much of what they complained about was either beside the point or already covered in the plan.

For those of us who have attended most of the Town Hall Meetings, some of these rants were amusing.

For instance, one speaker railed against the MTA for not taking corporate taxi medallions away from the companies and giving them to drivers on the list. Had he gone to a few of the later meetings, he would have known that Chris Hayahsi's plan already included exactly what he wanted.

And Bud Hazelkorn of the UTW gave an impassioned speech about how the companies would cheat and control the drivers by loaning them the money to buy their medallions. If he'd attended the meetings, he would have known that cab companies won't be allowed to loan money to drivers under Hayashi's plan.

Rua Graffis and Mark Gruberg, on the other hand, regularly attended the Town Hall Meeting. They simply didn't like the outcome. Gruberg, as usual, said that the City had no right to overturn Prop-K and Graffis still wants medallion holders to pay all the bills for a driver's fund.

However, the majority of speakers (most of whom had taken part in the Town Hall Meetings) backed the plan. Most of them also rightly praised Hayashi for negotiating a compromise among numerous, strongly (some thought "impossibly") divided factions.

Those speaking in favor of the plan included:

• Barry Korengold, Victoria Lansdown and Francois Speigelman of the SFCDA.
• Carl Macmurdo and Mike Spain of the MHA.
• Jane Bolig of Desoto, Dan Hinds of National, Jim Gillespie of Yellow and Charles Rathbone of luxor.

The most surprising speaker in favor of the plan turned out to be Director Malcolm Heinicke. He praised Deputy Director Hayashi, not only for working out a compromise plan, but for convincing him to discard his own previous ideas. He professed to like the experimental nature of the plan and said that "metrics" should be carefully chosen to study the measure's effects. He said he'd also like to see a retirement option re-introduced.

But although he did seem sincerely interested in "reform," Heinicke was clearly even more interested in the "revue streams" that these changes could bring into the city. He liked the retirement option because it could provide a "steady revenue stream." He also said that getting 15% from taxi medallion transfers wouldn't be enough. Heinicke said that the medallions were a City "asset" and he wants more out of them. In short - $15 million just won't cut it.

Director Bruce Oka praised Chris Hayashi for doing the "impossible" in unifying the cab drivers to support her plan.

Executive Director Nat Ford ended the meeting by stating that he would instruct the Chief of Police to aggressively go after illegal cabs and limos.

Deputy Director Hayashi will present a final plan complete with details to the MTA Board on January 29th. The Board will then formally vote on whether or not to accept the proposal on February 16th.

Hayashi's Plan: a Thought - Let's Back It!

I'm beginning to hear rumblings against Director Hayashi's plan. Maybe the Driver's Fund isn't big enough or maybe the retirement isn't quite what it should be or maybe the down payment will be too large. But why isn't the upfront option included? What about peak-time cabs? Why is the fixed rate so small? Why should those free-loading medallion holders get anything at all?

A few people are actually waiting to see if this or that detail will be included before deciding whether or not to back Hayashi's presentation before the MTA next Tuesday. One person even suggested that Chris might be playing "good cop/bad cop" with Newsom.

If so, is there really any doubt as to who the good cop is?

I think this nit-picking shows a monumental misunderstanding of the situation we are facing.

This is not the UTW or the MHA or the SFCDA vs Director Hayashi. None of these groups are powerful unions that could call an industry-wide strike. The best that any of them could do is file a lawsuit that would be expensive, may or may not succeed and might be beside the point by the time a decision would made.

The reality of the situation is that Hayashi is trying to make an omelet out of eggs have already been broken. She's trying to give something to everybody. She's tying to do what is possible. She's trying her best to be fair.

I think that the powers-that-be are betting that she can't do it. I believe that they think that "cabbies" are too quarrelsome and too stupid to hang together. Divide and conquer is the catch prase. They're waiting to see her fail.

I'd like to remind you all that Hayashi's plan is "temporary, experimental and provisional." If there is some detail you don't like, you have a year to change it.

On the other hand, if drivers don't support Director Hayashi at the MTA meeting next Tuesday, our input will be history. Without Chris's compromise plan, there will be no taxi reform. Newsom and Heinicke will decide what the plan will be.

In other words, not to support her now would be like shooting ourselves in the foot or committing political harry carey.

Chris Hayashi has been a tireless worker on our behalf. Let's show up in force on Tuesday. Supporting her is supporting ourselves.

More Town Hall Thoughts - Consensus

Shooting from the hip ...

Nobody thought that cab drivers could agree on anything. Yet here we are on the brink of a consensus.

We're still waiting to hear whether or not Newsom will back the plan. But he'd be politically foolish not to do so. Opposition by him would raise a storm of protest.

Director Chris Hayashi says that there have been 150 hours of meetings. I haven't kept track but I'm sure I've sat through at least 130 of those hours.

The most interesting (and beautiful) aspect of these meeting has been watching one person after another change his or her fixed positions and move toward the consensus that Chris worked so hard to develop.

Look at the results:

The MHA, Tarik Mahmood, Hansu Kim and even Michael Spain have dropped their demand for open auctions in favor of Hayashi's plan. Hansu Kim tells me that he's working hard to talk all his numerous political connections into backing the plan.

Barry Korengold and the SFCDA have dropped their opposition to a fixed price sale and agreed to support Hayahsi.

The cab companies have agreed to back the plan despite the fact they will lose their corporate medallions.

Personally, I was in favor of a compromise to begin with and thought that a fixed price sale was the only way to do this. I also thought that the non-medallion drivers should have some sort of fund.

My mind has been opened to several ideas that I hadn't thought of before like the retirement option and a seniority system based on A-cards.

My main point of opposition has been (and remains) to the City and the MTA using us as an "asset" to cure their budget problems. The $30 million they want to get from us amounts to a tax ten times higher than any other business is being asked to pay.

However, I have decided not to oppose Hayashi's plan to sell 60 medallions with all the proceeds going to the City for the following reasons:

• The City does have a budget crises and does need to the money.
• This need for money is what is moving this entire process. It's the price we have to pay to create a better cab system.
• I think the City is going to get it's money one way or another and Hayashi's plan is far better (and should result in far better cab service) than the plans that Newsom and Heinicke have tried to impose on us.

On the other hand, I will fight hand and pen to keep this from becoming a regular yearly budget item.

• The idea that cab drivers should be taxed to pay for the bloated salaries, overtime and bonuses of bus drivers and MTA staff is ludicrous and, for want of a better word, probably racist.
• It would define cab drivers as a permanent underclass to be exploited like the peasants and serfs of the past.

At the end of the year, when we put together a charter amendment, I will fight for a provision that would limit the amount of money that could be taken from us to the cost of administering the taxicab industry plus standard business taxes.

In the meantime, the plan that Chris Hayashi has put together with our help is far better than anything that anyone else has come up with. It's far better than the status quo. It's far better than anyone could have imagined when we started Town Hall Meetings back last March.

Plus - it's an experiment. It will give us the chance to modify, change and delete until we come up with a product that everyone can agree on. We can cherry-pick the ideas that work and throw away the rest.

I hope that everyone will show up to support this plan before the MTA Board at 2 PM, Room 400 of City Hall on Tuesday January 19, 2010

Hayashi's Reform Plan - Some Thoughts

I think it's time for me (photo) to make a few comments.

Taxi Director Chris Hayashi's plan is the only one to fully address the two major problems created by Prop-K: the lack of an exit strategy for aging drivers and fairness to people on the waiting list. The other plans have favored one group at the expense of the other.

The auction plans put forward by Mike Spain and others would certainly take care of the aging medallion holders but screw the people who have been waiting on the list for 10 or 15 years.

Contrary to their claims, an open auction would be totally unfair.

• It would reward the people with the most money.
• It would disregard length of service.
• It would callously disregard people who had chosen to stay in the cab business rather than do other things because they were promised that they would be rewarded for continuing to drive a cab.
• It would destroy the pool of professional drivers.

The plan put forward by the UTW and Mark Gruberg, on the other hand, might (or might not) help people on the list but it would screw the aging medallion holders. Of course Gruberg might say that these drivers should have saved enough money to take care of themselves. But first - what it their plan?

Rhetoric aside, the UTW has had one plan for the last 10 or 15 years: namely that medallion holders should sacrifice from 15 to 50 percent of their incomes to pay for the benefits, including retirement, of all drivers.

• I would agree that Pre-K medallion holders and the drivers who picked up their Post-K medallions "for free" 30 years ago certainly should have been able to fund their own retirement plans by now.
• But what about drivers who worked 15 years to get the medallion? Their medallions were not free. Shouldn't they be able to profit from their hard work? Would they have waited 15 years for $1,000 per month? I wouldn't have.
• I think that Gruberg's plan would put an end to professional drivers just as surely as Spain's plan would.
• It would more or less eliminate The List because few people would want to be on it.

But this is philosophy. The main problem with the UTW plan is that the same problems would remain intact that we have now: there would be no real exit strategy and The List wouldn't move any more quickly.

• The retirement plan put forward by the UTW either could not be realistically funded or would be too small to realistically retire on.
• Whether they should have saved their money or not, the aging drivers would want to hang onto that medallion.
• They would be driving at 75, 80 and 85 years of age and, since they'd be earning 15% to 50% less income than before, they'd probably have to drive longer hours.
• Or, the drivers physically too old to drive would be fraudulently claiming that they were driving - just like they are now.
• A draconian purge, aside from being callous, would probably only net 200 or 300 medallions.
• Once they were put on the street, you'd have the same situation that you have now.
• Nothing would be changed except that the medallions would be worth less money.

The major problem with Gruberg's thinking is that (instead of getting money from unions or companies as most benefit programs do) he wants to fund his plan with huge taxes against a group of people who don't make that much money to begin with.

• Medallion holders make about half the money that an experienced bus driver does.
• They make about one third less than the average person working in San Francisco.

Drivers who became medallion holders under his plan would make tens of thousands of dollars less over the course of their careers than they do now.

And for what? Benefits they might never use and retirement funds that wouldn't be enough to retire on.

Hayashi's plan, on the other hand, would create money for a Driver's Fund by taking a percentage from the sale of medallions.

I'm not sure if Hayashi's plan would actually be fair to people on The List or not. Would it move faster? Would the people high on The List get medallions in a timely manner or not?

She says that it would - that she would do things to make The List move.

It's an experiment. I don't see how anybody would be much worse off by trying it than they are now. By the end of the year, we should have an idea as to whether the experiment has worked or not.

By the end of the year, the aging driver problem should at least be solved. Then we can go on to dealing other problems.

Hayashi's Almost Final Stew - Maybe

Calling it "hybrid, experimental and transitional," Taxi Director Chris Hayashi presented yet another version of her taxi reform plan at the Town Hall Meetings yesterday. In fact, the plan was so transitional that she changed a section of it during the break between the afternoon and evening sessions.

Her reasoning behind this approach is that no one really knows what effect any change in Prop-K would really have.

"Some people claim that selling medallions would be great," said Hayashi, "others claim it would be a disaster." Her plan therefore is set up to find out what effects various reform ideas would really have.

She suggests\ed that the experiment would last a year and be evaluated by "wise" people belonging to the taxi industry. The hyper-democratic Hayashi said this industry oversight would consist of anybody in the taxi industry who wanted to participate. "If necessary," she said, "I'll find a bigger room."

The plan in outline:

Most of the 1500 Medallions would be treated the same as they are currently treated:

• The List would continue to operate as it does now eventually to be replaced by an A-card seniority system when, and if, it can be exhausted.
• People on the list, on a first come first serve basis, would offered the choice between getting a medallion the traditional way or buying a medallion at a fixed price.
• Hayashi promised to speed up the list: by taking corporate medallions away from the companies, aggressively weeding out the chaff and taking medallion away from people holding them fraudulently.

217 medallion holders over 70 years of age would be given the choice to keep working or sell their medallions:

• This number would be kept small in order to study the effect that his would have the industry.
• 
  

Medallions would be sold at a fixed price.

• The selling price probably would be between $200,000 and $300,000, depending upon financing terms available.
• The price would be determined party by the average driver's ability to pay and partly by the probability of a medallion holder selling it.
• These medallions would be offered to driver's on The List by seniority. If a driver wanted to wait to get a medallion ala Prop-K, the fixed price medallion would be offered to the next driver on the list.
• There would be a 20% transfer fee.
• 15% would go to the city
• 5% would go to a driver's fund.
• The City could buy back the medallions over time if the experiment didn't pan out - maybe?
• A monthly payment option in terms of annuities might be available in order to avoid a lump sum.

A retirement that had been part of the plan has been withdrawn but might be included in a different form later:

The City would sell 60 medallions outright and keep the money:

• This falls in the category of last but not least. Of course the motivation for "reforming" Prop K comes from the Powers-that-be's desire to extort money money for the Crown - er, City.
• This sale supposedly would be a one time thing .
• For every medallion put up for sale one would go to a person on The List. That is - 60 of 120 would be given out ala Prop_k.
• One to the list, one to the City.
• These would NOT be new issues.
• These medallions would come from medallions backlogged from the changeover to the MTA, turned in corporate medallions and revoked medallions.
• Director Hayashi says that she will have 90 medallions ready to go soon and will no trouble finding another 30.
• The City would earn between $12 million and $18 million - depending upon the fixed sale price.

The City's sale of medallions would go on at the concurrently with the fixed price sale of aging driver's medallions.

A lot more could said about all this - and soon will.

Town Hall Meetings Resume

The Town Hall meetings will resume on Wednesday, January 6, 2010 amid all kinds of rumors about what Chris Hayashi is going to present. Rumors are rumors and hold no interest for me - especially since we'll find out the truth tomorrow.

However, I do have questions that have arisen from Director Hayashi's last formulation of her plan:

• Is there going to be a retirement option? If so, what? And for how many people? And at what age?
• What will the fixed price be set at? What percentage will be required for a transfer fee?
• I'm assuming that the list will be kept but for how many people? Will it be cut off? And, if so, where?
• What form will the Drivers Fund take? How will it be financed?
• Does the MTA still intend to extort $30 million from us? Or, is there a more reasonable figure in the works?
• In the end, it's all about the numbers. What will the final numbers be?

And, oh yes, here is a question from a reader:

• Will the plan put an end to the "gates and gas" system? Or, will it protect "gates and gas" drivers?

Turn in tomorrow to start finding out.

The last rumor I heard had Ms. Hayashi presenting her final plan to the MTA at the 2 pm board meeting on Feb 2, 2010.

Here is the latest Schedule. There may be a few more meetings before February.

Taxi Town Hall Meetings

• Regulatory Amendments
• Proposed Reform Plan

Date and Time	Location
Jan. 6, 2010 2 to 5 p.m.	SFMTA - One South Van Ness Ave, 2nd Fl. Atrium
Jan. 6, 2010 6 to 9 p.m.	SFMTA - One South Van Ness Ave, 2nd Fl. Atrium
Jan. 8, 2010 2 to 5 p.m.	CANCELLED
Jan. 8, 2010 6 to 9 p.m.	CANCELLED
Jan. 11, 2010 6 to 9 p.m.	SFMTA - One South Van Ness Ave, 2nd Fl. Atrium

SFMTA Citizens’Advisory Council Taxi Committee Meeting

Report on Taxi Industry Reform Options

Date and Time	Location
Jan. 11, 2010 4:30 p.m.	SFMTA - One South Van Ness Ave, 3rd Floor (Room 3074)