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After more than one year of often heated discussions in various committee and board meetings, and a mediation session in February, some taxi drivers celebrated Thursday after City Council approved a new system that allows independent drivers to obtain a permit.
“We’ve been through this a number of times,” Mayor Ron Nirenberg said. “This is a sign of real compromise.”
Before Thursday’s vote only cab companies or co-ops could apply for permits; the new owner/operator permit category will open up the system to 75 drivers who are the sole owner of their taxi.
The permits can be phased in over three years to avoid oversaturating the market, Deputy City Manager Erik Walsh told Council, though the vehicle-for-hire industry has already seen a significant increase in drivers due to transportation network companies such as Uber and Lyft which have separate regulations and no permit caps.
Starting this October, San Antonio Police Chief William McManus will have the authority to release permits ahead of schedule “if demand requires,” Walsh said.
The City will issue at least 32 permits from the existing stock to independent taxicab operators this October and create 43 new permits – at least 25 in 2019 and 18 in 2020, or sooner if McManus chooses.
City staff originally recommended that the police chief’s oversight start in October 2019. But Councilman John Courage (D9) changed that to start in 2018 via an amendment on Thursday to provide a “more immediate opportunity” for taxi drivers to enter the market independently.
Councilman Greg Brockhouse (D6) favored the phased-release approach and thus voted against the ordinance that could allow for the 75 permits to be released all at once in October – should McManus deem it necessary.
“That’s not enough time to analyze [the results] or [for] the chief to make a decision,” Brockhouse said, adding that he preferred a more measured approach to mitigate potential unintended consequences.
“The taxis are operating on a completely un-level playing field,” he added, noting the lack of permit caps for drivers who use ride-hailing platforms Uber, Lyft, and others. “We should be looking at [those companies] first.”
Brockhouse cast the lone vote against the measure that passed 9-1. Councilman Clayton Perry (D10) was not present for the vote.
The previous City Council approved regulations for transportation network companies, often referred to as TNCs, in December 2016.
“[TNCs] are not going anywhere,” Councilman Manny Pelaez (D8) said. “They are a disruptive technology, and disruptive technology disrupts.”
Peleaz said he’s unsure “whether or not the role of government is to rescue industries that are not adapting” but emphasized that the mediation process produced what seemed like a good compromise.
“They were very professional – for the most part,” mediator and local attorney Danielle Hargrove said of the eight stakeholders who participated in the session on Feb. 23. Not everyone walked out of the room happy, she added, but “that’s the nature of the mediation process.”
The stakeholders were unable to come to a consensus about how many new permits should be issued, but they did agree on some qualifications: drivers must pass fingerprint background checks, have commercial insurance, and be the sole owner of the vehicle. City staff recommended that drivers have at least one year of experience driving in San Antonio.
Ultimately, it was the City’s 11-member Transportation Advisory Board, comprised of citizen stakeholders, that came up with the 75 permit number and phased-release idea, Walsh said.
While many taxi company owners were initially opposed to the idea of more permits in the system, some who participated in the process told Council they are willing to explore new policies because their ridership has declined since ride-hailing apps entered the local market in 2014. The owner/operator permit issue was raised last year when 200 independent taxi drivers submitted a request for the new permits.
“Let’s hope it works, but business continues to decline,” Robert Gonzales, owner of National Cab, told City Council. Gonzales blamed the “predatory prices” of transportation network companies for the traditional taxicab industry’s decline.
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The City currently has 848 authorized permits, Walsh said, but only 720 are in use, meaning 128 are not assigned to vehicles. Yellow Cab San Antonio has agreed to release 25 of its permits for the first year to be reassigned to independent drivers.
John Bouloubasis, president of the parent company of Yellow Cab San Antonio, told Council that additional permits could help the industry compete with TNCs.
“Hopefully today we can move forward,” Bouloubasis said, adding that he is still concerned that new independent taxi drivers won’t provide citywide services and just focus on busier areas such as the airport.
Walsh said the City’s Aviation Department is working on better signage and taxi stand access at the airport.
However, passenger pick-up from the airport is on the decline, Gonzales said, now that TNCs are allowed there, too. He described how one driver recently waited four hours at the taxi stand for a passenger.
That complaint didn’t resonate with Brockhouse, who suggested that cabbies should more actively pursue business.
“I’m not very sympathetic to someone that just sits and waits for the work to come to them,” he said.