Sunday, June 27, 2010

Inspector Dean Marcic Redefines "Conflict of Interest"

Shortly after the SFPD began its blitz on taxi driver licensing fees in December 2009, Deputy Police Chief John Murphy replaced Inspector Sgt. Ron Reynolds with Inspector III Dean Marcic as head of the Taxi Detail. (That there no longer is a Taxi Detail is a moot point. Marcic has never bothered to contact SFMTA Taxi Services, which was supposed to take over the work of the Taxi Detail.)

A brief comparison of their respective qualifications should help clarify why Chief Murphy made the change:
  • Sgt. Reynolds is one of the lowest users of overtime, Sgt Marcic (who billed over $100,000 in OT in both 2008 and 2009 - more than 50% of his SFPD income) is one of the highest.
  • Sgt. Reynolds is respected throughout the cab industry for his competence, helpfulness and knowledge of the taxi business while Marcic has spent the last several years towing cars.
  • Sgt. Reynolds works for the SFPD. Marcic supplements his income working part time as a security guard at Yellow Cab, in violation of SFPD Department General Orders (
Talk about a no brainer!

So, why did Chief Murphy make this curious change?

A curious question - almost as curious as Murphy's response last month during a meeting with members of the taxi industry when Bud Hazelkorn of the UTW and Director Christiane Hayashi of Taxi Services accused Sgt. Marcic of having a conflict of interest. Chief Murphy responded by saying that Marcic hadn't committed any crimes.

This from an officer who's supposed to have been enforcing the law for the last 20 years?

 A "conflict of interest" ( doesn't necessarily mean that a crime has been committed. It defines a situation where a person serves two masters and thus has the potential or the power to benefit him or herself at the expense of the public good. Marcic is conflicted in at least three ways:
  1. Yellow Cab owns Yellow Cab of South San Francisco,  some of whose taxis have been seen providing illegal cab service within San Francisco, and one of Marcic's major duties is illegal taxicab enforcement.
  2. Another duty is investigating cab companies and it would be easy for Marcic to favor Yellow Cab and Yellow Cab's drivers and medallion holders at the expense of other companies.
  3.  Marcic is also supposed to investigate charges of taxi company corruption - clearly an impossibility when he is being paid by the very entity he is supposed to be investigating.
It's not as if Inspector Marcic is a paragon of honesty to begin with as his dubious OT claims would attest.

But it goes way beyond that! Inspector Marcic and has already been here and done this. He was "laterally transferred"out of the Taxi Detail once before because he filed for excessive amounts of unauthorized overtime.  Marcic's billings were so outrageous that the staff overseeing the budget nicknamed his antics "Operation Salmon" after the pink slips that cops use to file for OT.

When you look at Inspector Marcic's rap sheet, it becomes more and more amazing that Chief Murphy put him in charge of the phantom Taxi Detail in the first place much less continues to defend him against all criticism.

The only reason I can think of is that replacing an honest cop like Sgt. Ron Reynolds with Inspector Marcic appears to have been a signal to the "good ole' boy" police network to "get it while you can." And, despite Chief of Police Gascon's claims to end OT, Marcic and his guys continue to file those pink slips at a furious pace.

Wednesday, June 16, 2010

The Perfect Crime: How the SFPD Rips Off Taxi Drivers

Last winter, the Mayor and the Board of Supervisors asked the SFPD and other City departments to cut back on overtime in order to fight the budget crises. Faced with this emergency, the cops acted as quickly as heroic policemen do on TV ... and took over illegal taxi and limo enforcement as means of stealing hundreds of thousands of dollars in licensing fees from taxi drivers and pumping the money into their own coffers.

Not that the police aren't busting limos and illegal cabs. Deputy Chief John Murphy of the SFPD sends out a listing of citations given almost every week. I'm talkin' 'bout the cost to us of this enforcement.

According to information obtained from the Public Records Act, from January 2010 through the first week of May, the cops:
  • Cited 85 illegal taxis and limos.
  • Handed out 247 tickets for waybill violations.
However, for these 332 hours (assuming every citation takes the police an hour), the SFPD billed the SFMTA (i.e. - the taxi industry) for 1,551 hours:
  • 1,148 of these hours (74%) were billed as overtime.
  • 843 hours (602 or 71% being overtime) were for handing out tickets to cars blocking transit lanes.
  • 297 hours (194 or 65% overtime) were for other non-taxi actions.
  • 285 hour (220 or 77%) were for "Other."
  • In short, only 21% of the actions the SFPD charged against taxi driver licensing fees had anything to do with illegal taxi and limo enforcement.
When you start looking at the details of these "police actions," it just gets better and better.
  • In early December, the SFPD replaced Sgt. Ron Reynolds, who was one of the lowest billers of overtime in the department, with Sgt. Marcic, one of the highest.
  • On 12/4/2009, 10 (yes TEN) police officers pulled over one illegal limo and billed the SFMTA (i.e. - the taxi industry) $838.07 to hand out a $137 citation.
  • On 1/16/2010, Marcic and five other police officers billed 50 OT hours for handing out one citation.
  • On 1/22/2010, 9 (that's NINE) police officers, including of course Marcic, gave out a citation at the cost of 64 hours of OT.
  • For some reason two of the cops (Officers Etcheber and Alexander, Mike) on the above bust only charged 4 hours of OT for their part (an attack of honesty?) but both of them billed an additional 2 hours straight time for an action that might be assumed to take not much more than one hour.
  • One Officer Bonnett tops a list of police persons who have billed the SFMTA (i.e. - the taxi industry) for overtime WITHOUT APPEARING IN ANY POLICE REPORT OR CITATION at 51 hours OT.
Unfortunately, the above fraudulent behavior is not limited to a few cops. It's SFPD policy. According to an e-mail sent from Deputy Chief Murphy to his boss, Chief John Haley on May 6, 2010 (obtained by a public records request):

"The salary budget (salary saving ) has 216,876 dollars or approximately 4170 hours remaining. The SFPD anticipates converting the salaried saving to OVERTIME FUNDS(My capitalization)."

That leaves 2,700 hours of OT that the SFPD has to spent before July 1, 2010 when the work order runs out. If they don't use it, they lose it.

If the cops were billing for the two or three cops and the one hour each that it would actually take to give a citation, they couldn't possibly spend the money in time.The corruption is endemic to the system that the SFPD has created.

In the meantime,there were 4 straight time positions that were eliminated from Taxi Services in order to create this OVERTIME FUND.Except for field work that was performed by police officers in the Taxi Detail, all of their jobs are now being performed by one clerk at the SFMTA including:
  • Taking new driver permit applications,
  • Training new taxicab drivers,
  • Discipling and retraining drivers,
  • 311 complaints,
  • Lost and found.
And this won't end on July 1st. The SFPD has put a $749,000 work order on next year's budget to insure that the officers can eat at better places than Happy Donuts.

The SFMTA budget has yet to be okayed by the Board of Supervisors for next year. If you don't like the SFPD ripping us off Supervisors Ross Mirkarimi and David Campos have both been very active in questioning police about overtime at recent budget hearings.

You can contact them at:

Supervisor Ross Markarimi
phone: (415) 554.7630

Supervisor David Campos
phone: (415) 554-5154

There is special meeting of the Board of Supervisor's Budget and Finance Committee on Monday, June 21st at 10.00 am.

The San Francisco Police Commission meets every Wednesday in room 400 of City Hall at 5:30 pm. They love to hear from cab drivers.

Sunday, June 13, 2010

Chris Hayashi Opens Her Desk Drawer

Director Chris Hayashi, as many of you know, has been accused of hoarding medallions in her desk drawer. I guess this is her answer to those critics.
Before I started my shift Saturday night, Charles Rathbone alerted me to this little chart tucked away on the SFMTA Taxi website. I don't know much about it. But it appears that Director Hayashi will be giving out medallions after all ... "for free."

SFMTA Taxi Services
Notice: Offer Letters
Per SFMTA Transportation Code, Division II, Section 1121(b), the following shall serve as notice for the individuals who have been sent an offer letter for a regular/ramp medallion taxi permit.
Regular Taxi Permit Offer
Sent June 11, 2010
List #
Type of Medallion
Osama Haddad
Vadim Sheynkman
Mikhail Shubov
Guillermo Tovar
Tito E. Dziensuwski
Adnan Atshan
Zalhdee A. Corpuz
Hsnein Al-Ghazzawi
Dmitry Vaynshteyn
Azzam Ennazzer
Brandon H. Wong
Kevin Tou
Mekonnen T. Zere
Nadeem A. Piracha
Benjamin F. Usog
Negusse H. Zeleke
Mohammed H. Khan
Hong Che
Francoise Spiegelman
Kirill Sobolev
Manuel Nunez

This comes as a surprise to me since the director recently said that she wouldn't start giving out regular medallions until after July 1st.

If nothing else, it's a good political move and should silence those of her detractors (for a few minutes anyway) who claimed that the SFMTA would never give out a "free" medallion again.

Wednesday, June 9, 2010

Seller & Buyers Meeting: Buyers

Rebecca Lytle of the San Francisco Federal Credit Union with help from Chris Hayashi led the buyers portion of the June 7, 2010 Town Hall Meeting with sellers and buyers.

Because I've already posted on this subject a couple of times recently and because the subject is very complex, I'll make this article short and sweet. To research this further contact Ms. Lytle at 415.359.2926 or check out the Taxi Medallion Financing website.

A Few Points

The list on the left gives the interest rates and monthly payments for various different situations.

For someone who takes part in the Down Payment Assistance Program, however, the interest rates and payments would be higher. For instance the figures for a buyer who only puts down $12,500 would read:
  • 3/25 Balloon 8.25% Interest $1,873 Monthly Payment.
  • 3/15 Balloon 8.00% Interest $2,270 Monthly Payment.
  • Some examples.
So of course the larger the down payment, the smaller the monthly payment.

The most interesting (and unusual) feature of this package are the options of paying off the loans over 3-year, 5-year, 7-year or 12-years periods. The payments on the 12-year loan could pretty much be covered by the monthly check given out by some of the companies.

And, of course, the sooner you pay off the loan, the less money you pay for the medallion thus making it more valuable.

Q & A

Q: Do I lose my place on The List if I'm turned down for a loan or finally choose not to buy?
A: No. You are removed from The List only if you do buy or fail to follow the rules.

Q: Do I lose my medallion if I finally choose not to sell?
A: Once you execute the sellers agreement, you are committed to sell. Otherwise the medallion stays with the current medallion holder - as long as he or she follows the rules

Q: If I have bad credit or no credit will I be turned down for a loan?
A: Not necessarily. It depends upon your overall financial picture.

Rebecca Lytle once again emphasized at the meeting that she thinks that "most applicants will be accepted."


A few drivers criticized Chris Hayashi for only having a single loan group available. One guy even stood up, screamed that the interest rate should be 4.5%, and left - without bothering to tell us where such terms might be available.

Driver Tariq Mahood, who is not on The List and therefore is not eligible to buy, attacked Hayashi for not opening the process up to more lenders, an attack he continued the following morning with an e-mail sent to seemingly everyone in the taxicab business.


Hayashi said that any lender qualified by Taxi Services could participate as long as they have no early payment penalties or other fees. She wants the loan companies to be qualified so that medallion holders aren't preyed on by loan sharks or controlled by taxi companies.

She said that she took a call this morning from Medallion Financial in New York (possibly motivated by Tariq) and told them to send her a letter to start the qualification process - just like she'd do for any other financial company that called her up.

At least she thinks so - this is the first finance company ever to cold call her.

A Defense

The criticism of Hayashi implies that she is either incompetent or dishonest. It also assumes that there are thousands of banks, credit unions and other financial institutions just eager and ready, jumping at the chance to lend to money to taxicab drivers.

The truth is this:

Last winter, Director Hayashi sent out letters to all 34 San Francisco credit unions (from a list provided by me) inviting them to partake in a Town Hall meeting about loaning money to cab drivers for the purpose of purchasing a medallion.

Three credit unions (3) sent representatives to the meeting joining a banker from The Bank of the West who had been invited by their client, Cindy Ward of Desoto Cab. All three reps disappeared within 45 minutes. The banker stayed out of deference to Cindy but his knuckles turned white from clutching his chair and he stared at me with a fixed, nervous smile while I tried to convince him that I would have made a good bet on a loan despite the fact that I'd paid for everything in cash for 20 years and had a 0 credit rating.

None of these four financial representatives ever contacted Hayahsi again.

The fact that a loan package exists at all is little short of miraculous.

I don't know where or how Hayashi found the lenders. I have no idea how she matched the San Francisco Federal Credit Union's local understanding with the Montauk Credit Union's expertise and brought in the other two companies to make the loans possible.

If I write a book about the creation of this Pilot Program (a thought becoming serious), I'll need to devote a chapter to this all by itself.

In addition, the loan package is better than anything else on the market.
  • There are no early payment penalties like there commonly are in New York.
  • This is the only type of loan from any credit union in the country than requires less than a 20% downpayment from the buyer.
  • SFFCU and Montauk actually will loan money to people like myself who are responsible but have no credit history.
Putting this package together was one of those mysterious actions that only Chris Hayashi could have pulled off. It matches her other feats:
  • A year ago, I would have put the odds against the Pilot Program existing at 100 to 1. I interviewed her at about that time and told her that coming up with a program that would satisfy the Mayor, the MTA, the Board of Supervisor and the various cab factions would take the wisdom of Solomon. I was trying to make her feel good. I didn't think Solomon could've done it.
  • In the space of less than two weeks she turned the MTA Board from being 6 to 1 against her to 6 to 1 in her favor and Malcolm Heinicke still doesn't know what happened to him.
  • She actually did get a consensus (minus Gruberg of course) from cab drivers about the Pilot Program. Think about this! When was the last time you heard two cab drivers agree on anything?
  • And, since the plan passed, without Hayashi to hold their hands, many of these same consensus drivers have reverted to form and are savaging each other on e-mail lists.
Face it! The woman walks on water.

As for her critics? They know not of what they speak.

I guess this post wasn't short after all. But it was sort-a sweet.