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Picture this, District resident: In the not too distant future, you go to hail a cab. Almost immediately a black sedan, which is less than six years old or has fewer than 300,000 miles on it, pulls up. The driver, a conscientious, properly licensed small businessperson, happily takes you wherever you want (even to Southeast).
During the ride you notice how clean and well maintained the cab is. You want the radio turned off? No problem. Turn the AC up? All you have to do is ask. Pleasant chit-chat with the driver about the weather, world affairs, love life advice? Free of charge! And when you pay, it’s a fair price, and the money is all properly reported, so that wherever the driver lives (though probably not in the District), you can rest easy knowing that he’s paying his fair share of taxes, just like you.
All in all, it’s the perfect cab ride.
That, at least, is one version of the future being pushed by supporters of a taxicab medallion bill, who say implementing a system like those found in other major cities would regulate a “free for all” industry, lead to better taxi service and help reform the D.C. cabbies’ oft-maligned reputation as a “laughingstock.”
But opponents of the bill present an alternate future: one in which a small group takes control of the taxi industry, squeezes out the little guy forever, and in the process, makes District riders pay more, wait longer (or forever, in some underserved parts of the city), and get crummier service than they did before the medallions came along to ruin a system that doesn’t really need a major overhaul.
Whom to believe? Well, before you decide, it’s important to note how much potential profit may be at stake. Owning a medallion is a great investment; not only do owners get a regular share of a cab’s profits, but the medallion itself can greatly increase in value over time. New York City sold medallions for $10 during the Great Depression. They’ve since skyrocketed in value, selling for $61,000 in 1961, $393,000 in 2005 and $766,000 in 2009, according to a report from the District Chief Financial Officer’s office that’s harshly critical of medallion systems.
The bill currently before the council would set the initial number of medallions at 4,000, which would be sold based on a seniority system (benefiting drivers with at least 20 years driving a cab in D.C.) for as little as $500 for an unrestricted medallion that could be used throughout the city. (There are currently about 10,000 cab driver, or hack, licenses in the District.)
Exact figures are impossible to know, but it’s not unreasonable to assume that in a few short years, those $500 medallions could be worth somewhere well north of the six-figure mark.
In justifying the low initial price for the medallions, supporters of the bill say they’re trying to help long-time drivers, particularly District residents, have something to show for their many years of hard work—instead of only a beat-up cab and whatever they managed to save, one 12-hour shift at a time.
When introducing the bill in March, Ward 8 Councilmember Marion Barry said he was “[looking] forward to pushing” the bill in order “to give equity and equality to our cab drivers.”
But now that the legislation is moving along through the process, many of those old-time drivers who would benefit most, whose ranks probably number close to 1,000, don’t believe Barry or other supporters of the bill have their best interests at heart.
“The medallion bill is a gift from Santa Claus with the Bogeyman inside,” says Nathan Price, chairman of the D.C. Professional Taxicab Drivers Association.
On Saturday, LL hung out with a few old-time hacks waiting at the Woodridge library to meet with lobbyist John Ray, who wrote the bill. (The meeting never happened; Ray says he was never scheduled to be there, despite what the cabbies thought.)
When LL brought up Barry’s comments on medallions giving old-time drivers something akin to a retirement package, the idea didn’t go over well.
“That’s full of shit,” Price says.
“That’s full of shit, man,” says Billy Edwards, a cabbie who has been working in D.C. for 47 years, a split second later.
The drivers fear the medallion bill is stacked in favor of older cab companies with money, instead of individual drivers, and there are too many provisions in the bill designed to either prevent drivers from getting medallions in the first place or strip them away if they do land one. The bill requires that drivers who receive medallions have a clean tax history for the last five years, and allows medallions to be revoked for general “misuse of the medallion in violation of the District taxicab laws and regulations.” If you think that sounds like a catch-all provision that could be used by an agency that operates without much public scrutiny to benefit powerful business interests, you’re not alone.
Larry Frankel, a cab driver who leads the Small Business Association of D.C. Taxicab Drivers, says that language would allow the city to “easily take back the medallions for almost any kind of offense.”
(For the record, Barry told LL this week that he’s also “unhappy” with his bill, but added that final legislation rarely looks like what it did when first introduced, and he wants to have a public discussion on the merits of a medallion bill.)
Drivers are also concerned about who is pushing the legislation.
Ray, the lobbyist who wrote the bill (and a former councilmember), says he’s working for a coalition of independent owner-operators numbering 200 or so, and 13 cab companies, or fleet operators.
But everyone LL spoke with in and around the taxi industry says there’s one driving force behind the bill: Jerry Schaeffer, the city’s taxi king, who owns more than a dozen cab companies, sells cabbies insurance, and owns a whole lot of District land (including the parcel on New York Avenue NE where the city’s first Walmart may go).
The theory among cabbies LL spoke to is this: Schaeffer hired Ray to draft the bill and is looking to use the medallion bill to snatch up as big a chunk of the taxi industry as possible. (For proof of how things work, they say, just look at Solomon Bekele, another bogeyman in hacks’ minds, who also sells insurance to District cab drivers and wound up cornering a quarter of the Atlanta taxi market after that city introduced a medallion-like system.)
“I don’t know why the newspaper guy is asking me… everybody knows it’s a Jerry Schaeffer bill,” says Mohammad Momen, owner of Silver Cab and one of the fleet owners that is part of Ray’s coalition.
But both Ray and Schaeffer characterize Schaeffer’s involvement as that of one among many. And they say individual drivers first approached Ray to write the bill.
“Nah, it ain’t just me,” says Schaeffer, adding that he has no interest in taking over the taxi industry. And Ray says his coalition wants to amend his bill to cap the number of medallions any one person or company can own at 400. For comparison’s sake, Schaeffer owns about 160 cabs, Ray says.
And then there’s the hot-button topic of ethnicity, which no story on the taxi industry would be complete without mentioning. There’s always been tension between the older African-American drivers and the immigrants from Nigeria, Pakistan, Ethiopia, and elsewhere who wind up driving cabs here. Frankel says the current bill, with its emphasis on seniority, is widely perceived as an attack on the newly arrived immigrant drivers, particularly Ethiopians (the bill would limit medallions to drivers who have had a license since 2006). Frankel says that perception was validated when Barry addressed a crowd of cab drivers protesting the bill and told them, “Many of you are not from America…We do things differently here.”
But regardless of the resistance to the bill, there’s a feeling among drivers that it’s inevitable that they will shortly be on the losing side of the long fight against medallions. There’s too much money at stake and there’s too much political juice behind the medallion push, the drivers say.
For proof, consider that the current bill was introduced a month after Ted Loza, former chief of staff to Ward 1 Councilmember Jim Graham, pleaded guilty to accepting bribes related to a past medallion bill.
“It was all about medallions,” says Leon Swain, the former D.C. taxicab commissioner, who says he worked undercover for the FBI for two years collecting evidence about the efforts behind bribing Loza.
Swain says that only two weeks after he started the job in 2007, a former big wheel in the Ethiopian cab community, Yitbarek Syume, coaxed him into having dinner at Syume’s Silver Spring home. Syume recently pleaded guilty to corruption charges and is awaiting sentencing. Among the topics discussed that night: implementing a new medallion system.
Swain says that during his undercover work, he recorded several conversations with Syume and other conspirators where they talked about how much money they were going to make off medallions.
And in an FBI document detailing debriefing sessions with Syume by FBI agents and obtained by Washington City Paper, Syume says he once gave Graham and Loza a free trip to Dulles International Airport (worth not much more than about $100 roundtrip, depending on tip). Among the topics of discussion among the three, according to Syume: a medallion system.
Of course, assertions about things like free cab rides are almost impossible to corroborate. It doesn’t take a defense lawyer to note that those facing criminal charges have an incentive to imply they’ve got dirt on powerful people, whether they do or not. And Syume’s claim to FBI agents is not the same as official testimony—for one, he wasn’t under oath. It’s been over a year since the debriefings, but Graham has not been charged with anything and has steadfastly denied any wrongdoing. He’s not sponsoring the new cab medallion bill, either. (Graham declined to be interviewed for this article, but did call LL’s boss to complain as soon as LL started asking questions.)
Several things Syume mentions in the debriefings have not been corroborated by court records. But LL was able to corroborate some other details of his story, unrelated to the alleged cab ride.
Still, the fact that the D.C. Council is willing to pick up the topic again, despite an FBI investigation into the last legislative effort on cab medallions, either means they think it’s a really good idea, or that the interests pushing it have a lot of clout. The letters “F,” “B,” and “I,” after all, aren’t usually among politicians’ favorites. Ray says this new bill is much better than Graham’s, and will reward cab drivers who have played by the rules, leading to a better taxi industry overall.
The question for you, cab rider, is: Do you believe him?
Got a tip for LL? Send suggestions to lips@washingtoncitypaper.com. Or call (202) 650-6951.
Photo by Darrow Montgomery