Monday, September 10, 2012

Malcolm on Top

Might as well start with Jim Gillespie (photo, below). He walked up to me with a big smile as I headed across the square toward the MTA board meeting last Tuesday.

"Going to write something in your blog?" he asked with a smile.

"I just found out that Heinicke (photo left) appears to be be violating the Sunshine Ordinance. The meetings are a farce," I told Gillespie. "The proposals are decided in advance behind close doors."

"I thought that's the way it worked," Jim said.

If anybody would know about such things it would be Gillespie. He was seen making one of those back door visits with his pal John Lazar and the way he jauntily bounded up the steps to City Hall told me how the vote would go.

MTA Board did indeed choose to lease 150 to 200 medallions or permits to taxi companies. The permits are supposed to go to the best run companies but "word on the street" is that Yellow will get more than its share anyway.

Jim used the incompetence of his company during the meeting as a reason for the City to give him more cabs. He especially mentioned that a high percentage of the people who call Yellow hang up before the dispatcher answers or cancel before Yellow picks them up.              

What he didn't bother to tell the Board was that Yellow often deliberately fails to answer the phone and then holds the orders for 9 to 12 minutes before dispatching them.  That way the company can use their poor service to ask for more taxis. And, the City is going to do it. Another doublethink classic.

The board will lease the taxis to the companies despite the fact that a study being done by Hara and Associates will not be finished until January.

This caused some discussion and the only dissenting vote. Chairman of the Board, Tom Nolan (photo left) thought that they should wait until the study was completed. He also wanted to revisit the decision if Hara came to the conclusion that no cabs were necessary. But, as one driver said, that's like closing the barn door after the horses are out.

There was an extended discussion by the Board members but it was one of those experiences where reality trumps satire.

Not that there is necessarily anything wrong with ignorance. But, it does take humility to learn and the Board has adamantly refused to listen to anybody - the Taxi Advisory Council, the drivers at the Town Hall meetings, the drivers at the MTA Board meetings, Director of Taxi Services Chris Hayashi, Dan Hara - who could teach them what's what.

The tone was actually set a few Board meetings ago when Director Joel Ramos (photo right) fervently thanked Director Malcolm Heinicke for helping them understand the taxi business. I have nothing to add. This is the level at which the Board functions.

Ramos thought the fact that Uber, Sidecar and other illegal Apps started in San Francisco was a priori proof that there must be a shortage of cabs. It couldn't have anything to do with the fact that this city is one of the Tech start up capitals of the world and that the businesses are being set up in such a way that it's almost impossible for them to lose money. Not to mention that these Apps are invading cities like Washington D.C. and Chicago that are flooded with taxis.

"Word on the street" has it that Director of Transportation Ed Reiskin (along with the Mayor's office) is responsible for raising the payout to medallion holders back up to $200 thousand from the $150 thousand that Heinicke wanted them to suck on. Although Reiskin is clearly being pressured from above to "show them the money," he appears to be struggling to do as best he can by the drivers and the cab riding public.

The problem is that he clearly does not understand the most basic things about the cab business. Nor does he know the characters in it.

And, why should he? He has the entire MTA under his purview. How could he know the nuts and bolts of every division? Especially one as complex as taxicabs? That's what the Director of Taxi Services is supposed to be for. But, of course, the Board has her on the top of their list of people not to listen to. (Hmm. I've just ended two perfectly good sentences in a row with prepositions. Take that Sister Pauline!)

Director Reiskin thought it was refreshing to hear from people outside the cab industry during public comment - after the usual collection of professional shills (most of them paid by Luxor or Yellow) came up calling for as many 700 more cabs. My favorites were the hotel rep and the woman from the Chamber of Commerce. They always want more cabs no matter what the situation. They wanted more after 9/11.

The hotel guy said that they couldn't find cabs at the hotels. Of course not. With all the limos lined up to grease the doorman, where would a cab park? The Commerce lady, as always, cited the expanding population of San Francisco as a reason to put out the taxis.

 She's right of course. In 1950, the population of San Francisco was 775,357. By 2010, it was 805,235. At that rate, one additional medallion a year should do the trick.

When another speaker and myself told Reiskin that, even if they started the process tomorrow, the additional cabs still wouldn't be ready for the Blue Angels, he was disconcerted. He thought about it for few moments and decided that "we have to get them out as soon as possible." He seemed to be unaware of the fact that, if the taxis were needed at all, it wouldn't be until May. Yes - there are no tourists between October and the summer.

The ideal time to add taxis would be in April. That way they wouldn't lower the incomes of current drivers and they'd be ready for the boat races next summer. There was no need to rush. Reiskin had plenty of time to read Hara's study and still add cabs if needed. Anyone in the taxi business could have told him so - if he'd been willing to listen.

On the other hand, someone else is clearly pushing Reiskin's buttons. (See the title of this post.) The only real reason to put the permits out fast is to funnel funds into the income streams of a few cab companies and the SFMTA.

One thing the Board members did right ...

was finally come out in favor of an Uber like App for taxicabs. Finally?

I wrote my first post on Cabulous and Open Taxi Access(OTA)  on January 28, 2011. The idea has been presented to the MTA Board on numerous occasions. The Taxi Advisory Council voted in favor of it. Cab drivers almost universally support it. Chairman Tom Nolan even said that the Board should look into the idea.

Cabulous started at approximately the same time as Uber in 2010. If OTA had been supported by the Board when it first came to their attention, everyone might be talking about how Uber is like Cabulous and not the other way around.

About the only people against it were the managers of Yellow and Luxor Cabs.

So what happened?

"Word on the street (dude sees all, hears all, knows all)" is that OTA died when President and General Manager of Luxor cab, John Lazar (photo), told former Executive MTA Director Nat Ford to kill it.

On the other hand, funds have recently been allocated to Taxi Services for electronic dispatch (The new name for OTA). Hopefully the Board will follow through this time.

Why $1,900 a month?

Of course this figure was not vetted (What is these days?) but the going price for medallions leased to taxi companies is currently $2,500. Yet here is the SFMTA selling permits on the cheap. To say the least, this runs contrary to their normal behavior. It also gives credence to the "word on the street" that John Lazar and Jim Gillespie worked out a back door deal after threatening to sue the SFMTA. At $1,900 a month Yellow and Luxor will make out like bandits - which isn't too far from their normal behavior.

Yellow takes in between $8,000 to $12,000 per day by encouraging its drivers to "voluntarily" tip. And, of course, John Lazar was asking for $10 per day plus $2 for the gasman at Luxor when I was there three years ago. At that time, he was also asking his cashiers to "voluntarily" tip him.  This meant that John's cashiers had to make $100 per shift in tips from drivers through Luxor's dispatching window (photo below) before they could make anything for themselves. This gives the word "voluntary" a whole new meaning.

What we have here, then, is the SFMTA getting together with two of the most dubious taxi companies in the business to divvy up money that had been headed to ease the old age of working cab drivers. This would appear to leave Director Malcolm Heinicke with a profound moral quandary:

Should the MTA take 15%, 33% or 50% from the companies' tipping jars? For the public good - as is, of course, understood.


  1. Johnny walker sez,

    Nice job on this article Healy, are you off your med's or what?

    1. yea good article Ed Healy... so what happens Ed lot of lawsuits? This stuff doesn't seem legal city going into direct leasing mode and picking winners and losers in cab industry , sure lots of corruption RICO act stuff going on between city commissioners and Yellow Cab and Luxor?
      and how about I hear city adding a total of 500 more cabs if this is the case the industry will collapse I suppose as who the hell will drive a cab for $35 dollars a day?

    2. Really if the city wants to lease medallions they ought to just offer the drivers 20$ per hour, a small health and dental plan with a 401k and maybe throw in a uniform for the drivers to wear and call it day, that would at least be fair.

  2. Yes, Johnny Walker I am off my meds. I'm back on alcohol and feel much more like myself.

    I've noticed that you've stopped making personal attacks and seem to be able to stay on topic. Did you finally find a woman you didn't have to pay for?

  3. A guy that still dispatches at Luxor told me flat out that he had to handover $125 a shift. That was a few years ago. Lazar turns every possible medallion over to his broker Mhd. Iqbal Khan. Lazar gets about $1000 a month under the table and of course it is the poor driver that gets over charged to pay for it.
    Lazar is ripping off his partners of course because once he turns over a medallion to Iqbal the company makes very little money on that cab.
    One med holder told me his med. was turned over to the broker without his permission. He was told "see Iqbal and. Arrange your shifts"
    Why do I get the feeling "johnny Walker" is a friend of Lazars? A tad short on debating skills.

  4. Johnny Walker sez,

    Well congrats to you Healy, I was wondering how long it would take for you to tired of being played for a fool, hopefully this lapse
    Is not temporary and as for my " women " problem, with women you either pay up now or later, it's all the same.
    In regards to anony @ 10:26 pm, if you had bothered to read any comments I have posted previously either on this blog or John
    Han's blog, you would realize my skills are up to par instead of shooting of the cuff with that piehole of yours and no, I'm no friend

  5. A particularly good blog. Many of the points are of incandescent clarity. The author makes many especially pertinent rejoinders to MTA Board jackass-potent stupidity. And I think that is a nice thing to say - the implication that they are downright evil is ever more imminent.

    I especially like the point made that the applications do not mean we need more cabs, not least because they are arising everywhere in the country. If that were the significance of computer activity then the whole internet would mean we need more porn and Viagra.

    In short, it is absolutely not the case that software creation necessarily bespeaks a market.

    I am glad that Chairman Nolan did the right thing and voted the obvious, it truly makes no sense to vote in more cabs when you have an incomplete study being prepared on that very question.

    Right now, here's what I think is at issue: The understanding we all have is that the upcoming study is supposed to provide information about whether medallions are needed. The MTA Board won't even wait for that. Member Brinkman especially astonished me at the previous meeting, saying they "had heard enough."

    Is it not a violation of the public trust to tell us you are going about things a certain way, to tell us that the information according to which you are going to make decisions is still in the process of being prepared, and then vote in advance of this preparation? While we previously thought the study was irrelevant, we certainly now KNOW it is irrelevant - the MTA Board made it so!

    Is not the study in effect an "announced item" like an agenda item or any other announced item, which the public has to be allowed time to respond to? Not only are we not getting a chance to respond to the study, we are not getting a chance to even see the study. Is it not a violation of public trust to act in advance of an item in this way?

    The MTA Board is a study all right... of corruption. They are politically dangerous cyborgs operated by power-drunks. Whoever is driving them should get some form of DUI of power-drunkenness. While so many of us are working so hard with both hands on the wheel these people are whooping it up and preparing their decisions in advance of meetings, even in advance of their own industry studies. They are no better than children who can vote themselves an "A" when playing teacher.

    1. "They are politically dangerous cyborgs operated by power-drunks."

      What a beautiful image. Inside Heineke there is a little tiny power-drunk operating the controls. Awesome!

  6. Johnny Walker sez,

    Well................ It certainly looks like the SFMTA, through it's officals, are getting ready to become defendants in a forum, federal in
    Nature and unlimited in fashion, oh well!

  7. Hey Barney,

    Try not to violate any federal or state laws when you do, unless you look good in a orange jumpsuit.

    1. You know what "Barney," in the grand scheme of things, I don't think Most people really care who I am except for the few I disagree with.
      Most people who know me, see my comments as consistent and agree with me more than most of the posters to this blog.
      Let's face it, the job we do, does no require a govt clearance, we do not save lives and furthermore when you get down to it, its just a service, nothing more, nothing less.
      That being said, the people who can least afford the changes the SFMTA are making will suffer the most.
      Many drivers and medallion owner are making plans as we speak to either exit this business or lateral over to Lyft,Uber or Sidecar and what will be left is a hollowed out taxi industry with high driver turnover, broken down vehicles.
      So, your point is what "Barney"?

  8. Hi Ed.
    Would you be able to tell me when the next SFMTA taxi meeting is taking place, Im one of the aging cab drivers that really got affected the most, so for all its worth Id just like to go down and give them a piece of my mind. Thank you.

  9. The meeting are held every other Tuesday at 1 pm. I think there was one yesterday. The MTA has a website. You can look it up there.

    We've been wondering where are you people have been hiding for the last 3 years. A Pice of your mind might have been more effective earlier.