Chris Daly's Charter Amendment

The charter amendment that Supervisor Chris Daly (seen working the press in the photo) is putting on the ballot would reinstate Prop. K with a few changes:

• 1. The full time driving requirement would be 800 hours only. There would be no option of driving 156 shifts.
  
• 2. The amendment, however, would allow for the MTA to "modify the personal driving requirement for a medallion holder with an injury or medical condition that precludes full compliance ..."
• 3. It further states that "the Agency shall make provision for the welfare of medallion holders and all taxi drivers who satisfy the personal driving requirement of 800 hours per year, including health care, retirement and disability."

This measure of course would have several drawbacks.

1. It would end any kind of transferability.
2. Since the MTA has no money, any fees for the above "welfare" would fall on the backs of the medallion holders. Judging by Supervisor Chiu's plan (see Et Tu Chiu ) such fees could run as high as $10,000 a year.
3. The 800 hour requirement for this welfare (which was not in last week's version) appears to be ambiguous. How could a driver retire if he or she needs to work 800 hours to collect the benefits?
4. While the provision for "modifying" the driving requirement for disabled drivers is an improvement over the current situation, it's vague and doesn't appear to deal with people disabled because of age.
5. There is no provision for an exit strategy or mention of a way to "retire with dignity."
6. It also would short circuit the Town Hall Meetings and thus kill any attempts by the various sides of the taxi industry to mediate a rational and thorough reform plan that could appeal to and be backed by most of people in the business.

Supervisor Daly's putting this measure on the ballot appears to confirm rumors that he plans run for mayor. Win or lose, the proposition could help his liberal progressive resume as the candidate who wants to bring "welfare to the workers."

However, I think Supervisor Daly has badly misread the situation if he thinks he's going to have the "cabbies" at his back. Instead he's succeeded in unifying most of them against him.

• All medallion holders favoring transferability will be against Daly's amendment.
• Medallion holders favoring the preservation of K will be against the measure because of the "welfare" fees and the lack of a clear retirement plan or exit strategy. Barry Korengold is advising SFCDA members to work against it for these reasons.
• Many if not most of the people on list - including many drivers that the UTW claims to represent - will also be against it because the measure will devalue the worth of a medallion.
• Ordinary drivers who want to buy a medallion at auctions of course will also be against the measure.

In short, the cab driver vote would probably run 4 to 1 or 5 to 1 against the amendment.

Nobody really knows what effect the opinions of cab drivers have on their customers but, when it comes to the subject of taxicabs, my guess is that it is quite a lot. Companies pay thousands of dollars to advertise on the top of a cab.

I wonder if Supervisor Daly fully understands what the inside of a taxi is worth?

Gavin Newsom Tries to Shaft the Medallion Holders

Mayor Gavin Newsom, who has fought against a business tax that he himself would have to pay, seems to have the wind at his back in his attempt to force taxicab owners to auction their medallions to pay off San Francisco's debt. In fact, a local newspaper poll showed 51% voting in favor of such a measure because the "city could use the money" while only 36% thought that the "current holders need the income."

Newsom of course has the stereotype of the greedy cab owner working in his favor. But perhaps more important are innumerable newspaper articles stating that medallion holders make $70,000 per year just by leasing out their taxies. 

Sounds like a lot of money, doesn't it? Especially for a bunch of lowlifes.  I kept running into this figure over and over so I decided to do something that local "journalists" have clearly never done themselves: I researched the subject.

• I asked several medallion holders about their incomes and they all said that they were coming up about $50,000 short of the factoid. When I asked them what they thought had happened to the money most of them didn't have a clue but one opined that Officer Makaveckas might somehow have gotten his hands on it.
• Seriously ... the $70,000 figure is arrived at by simple arithmetic. The leasing rate for a shift averages about $100. There are two shifts per day and 365 days per year = +70,000.
• The problem with simple arithmetic is that it's too simple. What is needed here is a little simple subtraction. The $70,000 is a GROSS: before the taxicab is bought, before insurance, before paying for the property on which to store the cab, before maintenance, before the property taxes, before the salaries for bookkeepers, accounts, lawyers, dispatchers, mechanics and other expenses are taken out.
• The medallion holders usually let the cab companies take care of the above details and split the money with them for the right to lease out the cabs to other drivers. The medallion holders average about $20,000 a year from the split. I don't know the companies' share. 

Now $20,000 might be a lot of money in San Francisco Del Mar, Mexico but in San Francisco, California it's barely enough to rent a studio apartment. That's why 85% of the medallion holders also drive cabs long hours themselves, bringing their yearly total up to $30,000 to $50,000 - which might get them a one or even a two bedroom rental but will never be enough to buy a house. This after working for at least 15 years in one of the most dangerous jobs (cab drivers are more likely to die by homicide then policemen) there is. By comparison:

• San Francisco policemen and policewomen earn  $75,868 to $101,556.
• Firefighters base pay averages $54,000.
• Muni bus drivers get a base salary of $56,000.
• AC Transit drivers start at $40,560.
• BART drivers make $64,296.
• All these groups have medical benefits, paid vacations, sick leave and retirement benefits.
• The benefit package at BART is worth over $29,000 per year.
• Most of these people could also  work overtime -  at least before the eco-tsunami hit.

The medallion holders:

• Have no benefits of any kind.
• No retirement.
• Pay the city one million dollars a year in a tax on the medallions.
• Pay the same 15% self-employment tax as regular cab drivers.
• Will have the City of San Francisco try to take their medallion away if they become old or disabled.
  

Mayor Gavin Newsom, to make another comparison, regularly makes in excess of $400,000 per year and has made more than $1,000,000 in a year on at least one occasion.

You can see why a man with Newsom's sense of fair play would hesitate to pay a 1.395% business tax.