Director Chris Hayashi of Taxi Services and Rebecca Lytle of the San Francisco Federal Credit Union led a by-invitation-only Town Hall Meeting for buyers and sellers yesterday. Over a hundred medallion holders and wannabes showed up.
The final figures are that 202 medallion holders signed up to sell their medallions and 1,442 want to participate as buyers.
Chris Hayashi says that she sent out 123 offer letters to buyers. Why 123? I forgot to ask but she has previously said that she could process 100 medallion sales this year and she thinks that some potential buyers might not be qualified. She probably wants to be sure that she can hit the century mark.
Not all of the 202 medallion holders who sent in their participation forms actually will sell their medallions. Some will choose not to. Others won't be qualified.
So the final number of medallions that will be sold under the Pilot Program remains unknown. More than 100. Less than 202.
What Sellers Must Do
Before the potential sellers can transfer their medallions they must sign and execute two contracts. (The details for this will be included in a package sent out by Taxi Services.)
The credit unions need a specific medallion number in order to process a loan. Once the medallion holder has turned in his or her paperwork, he or she will be will be matched up with a specific buyer and the sale can take place.
Contrary to our ever-incompetent local press, there will be neither hearings nor auctions. The buyer will show up at Taxi Services with the $250,000 fixed price and be given a slip showing that she or he owns a medallion. Handing over the medallion would be a nice touch but I don't know if Chris intends to do that.
To repeat what I said in a previous post, the people who complete the paperwork first will be the first to be matched up for a sale. Hayashi would like to see at least 10 medallions sold by July 1st.
More on Sellers and Selling
Once the seller executes the contract, the proceeds from the medallion sale can be passed on to any heirs or partners in case of death. Therefore Hayashi encouraged all sellers to designate a power of attorney.
Hayashi said that, as much as possible, she will try to accommodate the individual situations of the sellers.
- If a driver is disabled, for instance, he or she could sell their cabs later on so that they can continue to keep their monthly payments from the cab companies for a long as possible.
- Older or sick drivers, on the other hand, might be able to sell their medallions first.
- All things being equal of course. It's a complicated matter of mixing and matching the buyers and sellers.
People with disabilities should contact Hayashi's assistant Michael Harris at 701-4400 for special help with their situations.
- The medallions will originally stay with the color schemes where they are being held. The purpose of this is to insure continuity. Neither the companies nor the shift drivers will be hurt by a sale.
- Once the medallion is sold, however, a holder can switch to another company provided he or she follows the rules set forth by the Taxi Services.
- Once a buyer purchases a medallion, he or she will be able to turn around and sell it through Taxi Services. "But," Hayashi added, "there wouldn't be much point in selling it in the next 6 months because there be little equity."
- A seller cannot specify a certain buyer. They will be matched up by the criteria mentioned above or at random.
Which brings us to the least popular part of the program for the sellers.
- It's random because most sellers would not want to participate.
- If a seller does have to help with the downpayment, it would be held in a CD earning approximately 4% interest until it is paid off.
- It would take about 9 years to pay off $37,500.
- The original seller would be paid off if the new medallion holder dies, re-sells the medallion or has the medallion revoked and re-sold by the MTA.
Q & A
Q: Can a seller stop working once he or she executes the contract?
A: Not necessarily. All the rules covering medallion holders continue to apply until the medallion is sold. This means that the seller must drive the required hour and still can't assault the customers.
Q: What happens to the downpayment if the buyer dies? Meaning, I think, do his or her relatives have to pay? If so, how much.
A: The regulation on this is being written and needs to be okayed by the MTA board but it will involve some sort of pro-rata payment.
Hayashi emphasize that "this is a pilot program" and that if some things don't work or can be done better "they can be changed."