The San Francisco Federal Credit Union will wave the usual 20% downpayment fee and the terms of the loan can be for as long as 30 years. This would work out to payments of about $850 per month. At the moment most companies are paying $2,500 for leasing a medallion from a medallion holder. This would give the (we need a new name - "Last of the List"?) holders a profit $1,650 per month or $19,800 per year. And, this doesn't include the pluses like getting the best shifts and not having to worry about being fired.
On the negative side: In the unlikely event that they actually kept the medallion for 30 years, they'd double the cost of the loan. On the other hand, they'd also have made about $600,000 during the same period.
Is this good deal? As my uncle Victor might say, "It's better than a slap in the belly with a wet fish." It's certainly better than being number 201 on the List.
My poster boys William Mounsey #82 (top photo) and Brian Rosen #50 were breathing big sighs of relief when I spoke to them. The both had been sure that they would get nothing. Rosen calculated that that he could pay off the loan in five years and he'd have $240,000 to retire on.
I also spoke with number 300 on the List. I told him that he might be able to get one because about one-third of the people in front of him would be ineligible. He responded by saying,
"I'm so disgusted by the whole thing that I don't even want one."
So is the city going to mint up 150/200 new medallions and put them to the list? or will the people on the list still have to wait for revocations etc that were happening at what 5-25 a year?
ReplyDeleteEd,
ReplyDeleteI think you forgot to factor in Federal and State taxes should a new $150,000 medallion holder turn around and sell for $300,000 right away. That $90,000 left over would end up being around $50,000 after taxes.
At first, I was a little jealous having been one who bought mine for $250,000 two years ago. But it all works out. I've made about $50,000 in lease fees so far, so I wouldn't have come out ahead by waiting. Of course in my case, I probably would have got a free one with my position on the list, but who knew at the time. People who were near the top of the list were left to dangle in the wind like Mr. Mounsey. I'm glad he is finally getting one. He deserves it.
To Anon 11-30-12,
ReplyDeleteYes they will have to wait revocations etc. However, any new taxis put on the street are supposed go to the 200. There is a good (or possibly a bad) chance that the city will put out a few hundred with the boat races coming up. And, then, there is the question of what the MTA's word is worth.
To Anon 12-1-12,
I think that you're tax estimates are high. The capital gain on $90,000 would only be $13,500 + another $8,000 in state taxes = around $70,000.
Still you definitely had a better deal.
I agree about Mounsey and the others near the top but 400 or 500 should be eligible not 200.
The MTA is changing the rules yearly, to raise money, so it is good that you didnot go into the "Resale Value" of the Medallion, as it could be lower than the purchase price
ReplyDeleteWhat about the current lease value of $2500/per month... As the supply of Meds rises, the lease value will drop.
DO NOT count on getting that $2500/month in the future.
What about the DR? Does the new Owner have to fulfill the DR?
Etc.
jack barry
Whats a DR, also drivers can we please stop saying "FREE" earned is the word. Or was the word. Also Ed, Do you think it helps or may sway the board, to keep going to those board meetings and speaking at them in the hope that they may raise the eligibility on the list to 400 or 500. Thank you.
ReplyDeleteI am guess DR means driving requirement, and the only way to change this would be through lawsuits, and going over these guys heads to the board of supervisors.
ReplyDeleteI do think it helps to go to those meetings and keep hammering on the issues. I think the reason that the Pre-k drivers got to sell their medallions was that they showed up at every meeting and hardly anybody on the waiting list showed up until it was too late.
ReplyDeleteGoing over the heads to the Board of Supervisors? You don't know what's what dude. The current Supes are generally hostile to cab drivers. They tried to stop the meter increase from going through. They would have succeeded if it wasn't for John Avalos. They diluted the penalties against illegal taxis. They put Heinicke back on the MTA board. Heinicke ran his plans through them before he brought them to a vote for the MTA.
That leaves lawsuits and maybe a ballot.