It began with an act of betrayal. After promising in writing to preserve the taxi medallion system established by Proposition K of 1978, Mayor Gavin Newsom went back on his word and endorsed the sale of medallions as a means of raising millions of dollars for the city.

Under Prop K, medallions are city-owned and cannot be bought and sold. Well over 1,000 cab drivers have been issued medallions and gained a stake in the taxi industry on account of the law.

The voters have supported Prop K eight different times against attempts to repeal, amend or nullify its provisions. But under a 2007 Charter Amendment, Proposition A, the power to change K has passed into the hands of the city’s transportation agency, the MTA.

The MTA took over taxi regulation in March. In order to get the Board of Supervisors’ support for that move, MTA Executive Director Nathaniel Ford echoed Mayor Newsom’s pledge, promising the board to protect Prop K.

Soon after it began regulating taxis, the MTA placed in its budget $15 million dollars in industry revenues, presumably from medallion sales, despite the fact that it had not held any policy discussions on the question. The money is currently “on reserve”.

Newsom continues to push the idea of selling medallions. In a mid-November radio interview, he reportedly said he wants to raise $100 million from their sale.

Now a decision is nearing on whether to fulfill Newsom’s wishes. From all indications, MTA Taxi Director Christiane Hayashi is going to recommend to the agency’s Board of Directors a plan that would make some medallions transferable, possibly for a fixed price, while others will continue to go to drivers on the list.

Some may also be issued according to A-card seniority. Whatever the plan, the city will collect a hefty sum. Hayashi has indicated that she wants to introduce medallion transferability through a limited pilot program, in order to gauge its effects. But once the cat is out of the
bag, it will be next to impossible to get it back in.

In the meantime, Hayashi has been holding a series of Town Hall meetings with industry participants to discuss changes to the system. Most of the regular attendees at these meetings have been medallion holders and company representatives.

More than two dozen plans have been submitted for consideration. Some of these ideas are the work of Prop K medallion holders who wish to cash in on permits they never paid for in the first place.

Most of the plans would restrict medallion sales only to drivers, either through an auction system or at a fixed price. Estimates of sales prices range from $200,000 to $500,000 or more.

UTW has a number of objections to the sale of medallions. Among them:

• It would pull the rug out from under drivers who have waited long years for their permits, and deprive them of their opportunity to gain a stake in the industry;

• It would create an undeserved windfall for Prop K medallion holders, who paid only an application fee for their permits;

• It would open the door to outside interests profiting at the expense of drivers, or controlling medallions themselves through secret arrangements.

• It would create a huge debt burden upon the purchasers of medallions, putting pressure on gates and meter rates.

The various Prop K plans will be posted online on the MTA’s website, www.sfmta.com.

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Benefits are provided through United Taxicab Workers and Communications Workers of America, AFL-CIO. For information call (415) UNI-TAXI (864-8294).

E-mail: utw8294@energy-net.org