To be argued by:
RICHARD DEARING
20 minutes requested
Supreme Court, New York County
State of New York
Court of Appeals
TAXICAB SERVICE ASSOCIATION, et al.,
Plaintiffs-Respondents,
v.
THE STATE OF NEW YORK, et al.,
Defendants-Appellants.
. (Index No. 102553/12) .
METROPOLITAN TAXICAB BOARD OF TRADE, et al.,
Plaintiffs-Appellants,
v.
MICHAEL R. BLOOMBERG, as Mayor of the City of New York, et al.,
Defendants-Appellants.
. (Index No. 102472/12) .
GREATER NEW YORK TAXI ASSOCIATION, et al.,
Plaintiffs-Respondents,
v.
THE STATE OF NEW YORK, et al.,
Defendants-Appellants.
. (Index No. 102783/12) .
CORRECTED BRIEF FOR STATE APPELLANTS
BARBARA D. UNDERWOOD
Solicitor General
RICHARD DEARING
Deputy Solicitor General
ANDREW W. AMEND
CLAUDE S. PLATTON
Assistant Solicitors General
of Counsel
ERIC T. SCHNEIDERMAN
Attorney General of the
State of New York
Attorney for State Appellants
120 Broadway
New York, New York 10271
(212) 416-8022
(212) 416-8962 (facsimile)
Dated: January 22, 2013
i
TABLE OF CONTENTS
Page
TABLE OF AUTHORITIES...................................................................... iv
PRELIMINARY STATEMENT.................................................................. 1
ISSUES PRESENTED ............................................................................... 9
STATEMENT OF THE CASE ................................................................. 10
A. The Taxi Medallion Industry in New York City................... 14
1. The Restriction of taxi medallion supply in the
1930s................................................................................ 15
2. Market distortion and resistance to reform in the
taxi industry in recent decades ...................................... 17
B. The Legislature’s and Governor’s Efforts To Broaden
Access to Street-Hail Service in New York City................... 23
1. Events leading to the HAIL Act’s passage .................... 23
2. The HAIL Act’s provisions to improve access to
safe and reliable taxi service for persons in the
outer boroughs and for disabled persons....................... 28
C. The Medallion Owners’ Challenge to the Legislation .......... 31
D. Supreme Court’s Invalidation of the HAIL Act .................... 34
JURISDICTIONAL STATEMENT.......................................................... 35
ARGUMENT ............................................................................................ 35
ii
TABLE OF CONTENTS
Page
POINT I - THE LEGISLATURE ACTED WELL WITHIN ITS
CONSTITUTIONAL AUTHORITY IN ENSURING
ACCESS TO SAFE AND RELIABLE
TRANSPORTATION FOR MILLIONS OF NEW
YORK CITY RESIDENTS AND VISITORS .................... 35
A. The HAIL Act Directly and Rationally Serves
Substantial State Interests. ......................................... 37
1. The Legislature made detailed findings
demonstrating that the HAIL Act serves
substantial state concerns. ...................................... 42
2. The Legislature’s express findings as to
substantial state concerns are factually well-
grounded and supported by this Court’s home-
rule precedents. ........................................................ 47
B. Supreme Court’s Reasons for Dismissing the
Substantial State Interests at Issue Here Do Not
Withstand Scrutiny....................................................... 54
1. New York City’s history of regulating taxis
does not disable the State Legislature from
acting in furtherance of a substantial state
interest...................................................................... 55
2. The court’s assertion that the statute is merely
the product of political maneuvering is both
irrelevant and incorrect. .......................................... 62
3. There is no basis for Supreme Court’s holding
that the statute’s effects are disproportionate
to the State’s interests. ............................................ 64
iii
TABLE OF CONTENTS
Page
C. The HAIL Act Also Does Not Violate the Double
Enactment Clause......................................................... 75
POINT II - THE HAIL ACT DOES NOT GIVE PRESENT
HOLDERS OF LIVERY LICENSES A MONOPOLY
PROHIBITED BY THE EXCLUSIVE PRIVILEGES
CLAUSE............................................................................. 79
CONCLUSION ......................................................................................... 89
iv
TABLE OF AUTHORITIES
Cases Page(s)
19th Street Associates v. State,
172 A.D.2d 380 (3d Dep’t 1991), aff’d on other grounds,
79 N.Y.2d 434 (1992)............................................................................ 82
Adler v. Deegan,
251 N.Y. 467 (1929).................................................................. 38, 48, 49
Admiral Realty Co. v. City of N.Y.,
206 N.Y. 110 (1912)........................................................................ 38, 49
Albany Area Builders Ass’n v. Town of Guilderland,
74 N.Y.2d 372 (1989)............................................................................ 77
Boreali v. Axelrod,
71 N.Y.2d 1 (1987)................................................................................ 69
Bugeja v. City of N.Y.,
24 A.D.2d 151 (2d Dep’t 1965),
aff’d, 17 N.Y.2d 606 (1966) ...................................................... 38, 48, 69
City of Buffalo v. Stevenson,
207 N.Y. 258 (1913).............................................................................. 19
City of N.Y. v. Patrolmen’s Benevolent Ass’n of
the City of N.Y. Inc.,
89 N.Y.2d 380 (1996).......................................................... 39, 40, 45, 63
City of N.Y. v. State,
67 Misc. 2d 513 (Sup. Ct. N.Y. County 1971),
aff’d, 31 N.Y.2d 804 (1972) ............................................................ 38, 48
City of N.Y. v. State,
94 N.Y.2d 577 (2000)...................................................................... 58, 63
City of N.Y. v. Vill. of Lawrence,
250 N.Y. 429 (1929).............................................................................. 63
v
TABLE OF AUTHORITIES
Cases Page(s)
City of Rochester v. Gutberlett,
211 N.Y. 309 (1914).............................................................................. 87
Consumers Union of U.S., Inc. v. State,
5 N.Y.3d 327 (2005)...................................................................... passim
Floyd v. N.Y. State Urban Dev. Corp.,
33 N.Y. 1 (1973).................................................................................... 75
Fox v. Mohawk & Hudson River Humane Society,
165 N.Y. 517 (1901).............................................................................. 82
Hotel Dorset Co. v. Trust for Cultural Resources,
46 N.Y.2d 358 (1978)................................................................ 38, 51, 84
In re Elm Street,
246 N.Y. 72 (1927).......................................................................... 40, 41
Matter of Kelley v. McGee,
57 N.Y.2d 522 (1982)...................................................................... 37, 66
Matter of N.Y. Elevated R.R. Co.,
70 N.Y. 327 (1877)................................................................................ 84
Matter of Osborn v. Cohen,
272 N.Y. 55 (1936).............................................................. 40, 46, 49, 56
Matter of Rudack,
163 Misc. 326 (Sup. Ct. N.Y. County),
aff’d, 274 N.Y. 615 (1937) .............................................................. 15, 16
Matter of Town of Islip v. Cuomo,
64 N.Y.2d 50 (1984).................................................................. 37, 39, 47
Matter of Union Ferry Co. of Brooklyn,
98 N.Y. 139 (1885).......................................................................... 80, 81
vi
TABLE OF AUTHORITIES
Cases Page(s)
McAneny v. Bd. of Estimate & Apportionment,
232 N.Y. 377 (1922)........................................................................ 38, 49
Metro. Transp. Auth. v. County of Nassau,
28 N.Y.2d 385 (1971)............................................................................ 49
Miller v. Johnson,
515 U.S. 900 (1995) .............................................................................. 67
Montgomery v. Daniels,
38 N.Y.2d 41 (1975).............................................................................. 74
N.Y. Steam Corp. v. City of N.Y.,
268 N.Y. 137 (1935).................................................................. 38, 47, 48
Noel v. N.Y. City Taxi & Limousine Comm’n,
687 F.3d 63 (2d Cir. 2012) ............................................................. 21, 22
Noel v. N.Y. City Taxi & Limousine Comm’n,
837 F. Supp. 2d 268 (S.D.N.Y. 2011),
rev’d, 687 F.3d 63 (2d Cir. 2012) ......................................................... 22
Patrolmen’s Benevolent Ass’n of the City of N.Y. Inc. v.
City of N.Y.,
97 N.Y.2d 378 (2001).................................................................... passim
People v. De Jesus,
54 N.Y.2d 465 (1981)............................................................................ 37
People v. Devlin,
33 N.Y. 269 (1865)................................................................................ 63
People v. Knox,
12 N.Y.3d 60 (2009).............................................................................. 87
Robertson v. Zimmerman,
268 N.Y. 52 (1935).......................................................................... 39, 66
vii
TABLE OF AUTHORITIES
Cases Page(s)
Sheehy v. Big Flats Comty. Day, Inc.,
73 N.Y.2d 629 (1989)............................................................................ 74
Trustees of Exempt Firemen’s Benevolent Fund of City of N.Y. v.
Roome,
93 N.Y. 313 (1883)................................................................................ 81
Uniformed Firefighters Ass’n v. City of N.Y.,
50 N.Y.2d 85 (1980).............................................................................. 48
Wambat Realty Corp. v. State,
41 N.Y.2d 490 (1977).................................................................... passim
Wolpoff v. Cuomo,
80 N.Y.2d 70 (1992)........................................................................ 65, 74
Constitutional Provisions
N.Y. Const.
article III, § 17............................................................................ 9, 33, 79
article IX, § 2(b)............................................................................ passim
article IX, § 3 .................................................................................. 33, 36
Laws
State
C.P.L.R. 5601(b)(2) ................................................................................... 35
Ch. 63, 2003 N.Y. Laws 2543 ................................................................... 20
Ch. 209, 1956 N.Y. Laws 901 ................................................................... 16
Ch. 359 , 1995 N.Y. Laws 3144 ................................................................ 20
Ch. 498, 1984 N.Y. Laws 2678 ................................................................. 59
viii
TABLE OF AUTHORITIES
Laws Page(s)
Ch. 535, 2006 N.Y. Laws 3432 ................................................................. 20
Ch. 602, 2011 N.Y. Laws, as amended by ch. 9, 2012 N.Y. Laws... passim
Ch. 929, 1937 N.Y. Laws (vol. II) 1.......................................................... 16
Executive Law § 290................................................................................. 59
General Municipal Law § 181 .................................................................. 78
Muncipal Home Rule Law § 2 .................................................................. 77
Public Authorities Law
§ 553-e................................................................................................... 70
§ 1266-c................................................................................................. 69
§ 1728.................................................................................................... 70
§ 1729.................................................................................................... 69
Statute of Local Governments § 10.................................................... 76, 78
Tax Law § 1281......................................................................................... 58
Transportation Law § 15-b....................................................................... 59
Unconsolidated Law § 9609 (McKinney) ................................................. 70
Vehicle and Traffic Law § 370.................................................................. 59
New York City
N.Y. City Charter
§ 109...................................................................................................... 72
§ 225...................................................................................................... 72
§ 254...................................................................................................... 72
§ 2303.................................................................................................... 17
ix
TABLE OF AUTHORITIES
Laws Page(s)
N.Y. City Admin. Code (2011)
§ 19-502 .......................................................................................... 14, 30
§ 19-504 ................................................................................................ 30
§ 19-505 ................................................................................................ 30
§ 19-511 ................................................................................................ 30
§ 19-514 ................................................................................................ 14
35 Rules of City of N.Y. (2012)
§ 58-38 .................................................................................................. 14
§ 59A-03.......................................................................................... 14, 30
N.Y. City Local Law No. 12 (1971) .......................................................... 17
Miscellaneous Authorities
1936 Legis. Doc. No. 83 .......................................................... 15, 16, 50, 57
1986 N.Y. Op. Att’y Gen. (Inf.) 6.............................................................. 20
A. 8496, 234th Sess. (2011) ................................................................ 24, 25
Bram, Jason, & Alisdair McKay, The Evolution of Commuting
Patterns in the New York City Metro Area, 11 Current Issues in
Econ. & Fin. 1 (Oct. 2005), available at
http://www.newyorkfed.org/research/current_issues/ci11-10.pdf...... 11
Competition Comm., OECD, Taxi Services: Competition and
Regulation (2007), available at
http://www.oecd.org/regreform/liberalisationandcompetition
interventioninregulatedsectors/41472612.pdf ........................ 20, 61, 86
Empire State Dev., Census 2010 Data,
http://esd.ny.gov/NYSDataCenter/Data/Census2010/PL2010Tab
1NY.pdf........................................................................................... 10, 52
x
TABLE OF AUTHORITIES
Miscellaneous Authorities Page(s)
Fessenden, Ford, & Sam Roberts, Then as Now—New York’s
Shifting Ethnic Mosaic, N.Y. Times, Jan. 22, 2011, available at
http://www.nytimes.com/interactive/2011/01/23/nyregion/20110
123-nyc-ethnic-neighborhoods-map.html. .......................................... 52
Goldman, Ari L., Taxi Panel, After Yearlong Study, Offers 73 Ways
To Improve Service, N.Y. Times, Mar. 30, 1982, at A1 ...................... 19
Metro. Transp. Auth., Guide to Access-A-Ride Service, http://www.
mta.info/nyct/paratran/guide.htm....................................................... 60
N.Y. Assembly, Tr. of June 21, 2011 Proceedings, 234th Sess.,
available at http://assembly.state.ny.us/write/upload/
session/2011/20110621.pdf ................................................ 25, 26, 44, 88
N.Y. City Econ. Dev. Corp., New Yorkers and Cars,
http://www.nycedc.com/blog-entry/new-yorkers-and-cars. ................ 12
N.Y. City, NYC Statistics, http://www.nycgo.com/ articles/nyc-
statistics-page ...................................................................................... 11
N.Y. City Taxi & Limousine Comm’n, Taxi Medallion Increase
Draft Environmental Impact Statement (2012), available at
http://www.nyc.gov/html/tlc/downloads/pdf/taxi_medallion_incr
ease.pdf................................................................................................. 20
N.Y. Senate, Tr. of June 24, 2011 Proceedings, 234th Sess.,
http://open.nysenate.gov/legislation/transcript/regular-session-
06-24-2011 ............................................................................................ 25
Nelson A. Rockefeller Inst. of Gov’t, 2010 New York State
Statistical Yearbook, available at
http://www.rockinst.org/nys_statistics/2010/1-88.pdf ........................ 11
Rogoff, Edward G., Regulation of the New York City Taxicab
Industry, City Almanac 1 (Aug. 1980) .................................... 17, 18, 21
xi
TABLE OF AUTHORITIES
Miscellaneous Authorities Page(s)
Rollcall Vote, ch. 602, 2011 N.Y. Laws.................................................... 26
S. 5825, 234th Sess. (2011) ................................................................ 24, 25
Schaller, Bruce, The New York City For-Hire Vehicle Fact Book
(1993), http://www.schallerconsult.com/taxi/fhv_fb.htm. .................. 19
Taxi & Limousine Commission, Rate of Fare,
http://www.nyc.gov/html/tlc/html/passenger/taxicab_rate.shtml...... 13
Taxi & Limousine Commission, Medallion Taxicab Passenger Bill
of Rights, http://www.nyc.gov/html/tlc/html/passenger/
taxicab_rights.shtml ............................................................................ 13
Tourism Economics, The Economic Impact of Tourism in New
York: 2011 Calendar Year Hudson Valley Focus, available at
http://www.rocktourism.com/images/pdf/NYS-Tourism-Impact-
Hudson-Valley.pdf. .............................................................................. 11
U.S. Bureau of the Census, The 2012 Statistical Abstract,
available at http://www.census.gov/compendia/
statab/2012/tables/12s0027.pdf ........................................................... 53
Xenias, Anastasia, & Ron Erdmann, International Travel and
Tourism Exports and the New York Economy, Weissman Ctr.
for Int’l Bus. Occasional Paper Series (Oct. 2011), available at
http://uscib.org/docs/WCIB%20Occasional%20Paper%20NY%20
Tourism%20Exports%20%282%29.pdf ......................................... 11, 21
1
PRELIMINARY STATEMENT
These direct appeals are taken from a ruling of Supreme Court,
New York County (Engoron, J.), that struck down on home-rule grounds
a state statute, the HAIL Act,1 that the Legislature enacted to address
serious and persistent deficiencies in the taxi system of New York City
that impair the welfare, health, and safety of millions of residents of
and visitors to this State. The lower court held that the Home Rule
Clause in article IX, § 2(b)(2), of New York’s Constitution renders the
State Legislature powerless to address these significant problems in the
transportation system serving New York City through a statute that
provides for an expansion of the number of taxi licenses (or
“medallions”) to be issued in New York City, requires that these
additional licensed taxis serve passengers with disabilities, and
significantly expands street-hail service to passengers located in the
outer boroughs of New York. Because the lower court’s ruling is
1 Ch. 602, 2011 N.Y. Laws, as amended by ch. 9, 2012 N.Y. Laws.
Citations to the Act in this brief are to the 2012 amended version that
appears in the Record on Appeal (see also infra note 8), unless
otherwise specified; a copy of the 2012 amended version also appears in
an addendum to this brief.
2
contrary to this Court’s established home-rule precedent, this Court
should reverse.
Under the structure of our State Constitution, the legislative
authority of the sovereign State is reposed in the Legislature. The
Legislature may act by general law of statewide application on any
subject matter appropriate for legislative action, including matters that
relate to the property, affairs, or government of local governments. And,
notwithstanding the Home Rule Clause of article IX, §2(b)(2), it may
also act by special law that applies only in a particular city or other
locality within the State, so long as the special law rationally serves a
substantial state interest.
As relevant here, the Home Rule Clause restricts the State
Legislature by providing that a special law affecting a municipality’s
property, affairs, or government that does not serve a substantial state
interest may be enacted by the Legislature only where the law is
formally requested by the municipality where the law would apply—a
request that is commonly known as a “home-rule message.” But the
requirement of a home-rule message does not apply when the law
rationally serves a substantial state interest. This case is about
3
whether the HAIL Act rationally serves such an interest. The record
establishes overwhelmingly that it does.
The Court has only rarely invalidated an act of the Legislature on
home-rule grounds, and it has no reason to do so here. The Legislature
acted well within its authority in passing the HAIL Act, because the Act
serves the substantial state interest in ensuring that millions of
residents and visitors in New York City have access to safe and reliable
transportation. The Legislature and Governor gave careful consideration
to the statute, and the Act contains detailed and specific findings
demonstrating the substantial state interests that the statute promotes.
The facts that underlie the Legislature’s findings, moreover, are
undisputed. New York City taxis—yellow, metered cars available by
hail in the street—transport 650,000 people every day, and nearly a
quarter-billion every year. Riders include the city’s 8 million residents,
750,000 daily commuters, and 50 million annual visitors. Passengers
take taxis to and from work, airports, hospitals, hotels, shopping,
dining, entertainment, tourist attractions, and any number of other
destinations. The difficulty and expense of maintaining, owning, using,
and parking privately owned cars in the city is well known.
4
Consequently, taxis, together with subways and buses, compose a
critically important transportation system that allows people to travel
into, through, and out of the metropolitan area that is by far the State’s
largest, as well as the engine of the State’s economy.
Taxi service in New York City suffers from serious and persistent
deficiencies and disparities. Though taxis provide essential benefits to
those able to find them, the number of licensed taxis today is lower than
it was seventy-five years ago, with the result that taxis are not
realistically available to people in most parts of the city—including
many working class neighborhoods and communities of color—or to
those with disabilities. Taxis pick up 95 percent of their passengers in
Manhattan’s central business district or at an airport, virtually ignoring
areas of the city where 6 million New Yorkers reside and thousands of
visitors travel every day. And even where taxis do operate, fewer than 2
percent are wheelchair accessible.
With metered taxis thus unavailable, people in New York City have
resorted to participating in an unregulated underground market served
by livery cars—which are authorized only to provide prearranged
transportation by dispatch—and “gypsy cabs,” which are not licensed at
5
all. This market accepts unlawful street hails at a rate of more than 50
million a year. Because these livery cars and gypsy cabs are unmetered,
and in the case of gypsy cabs completely unregulated, they expose riders
to the risk of price gouging, inadequate insurance, refusal of carriage,
and other inequities.
These distortions in New York City’s taxi market reflect a
regulatory failure at the local level. The city regulates taxis under
authority delegated to it by the State. In 1937, the city exercised that
delegated authority to cap the number of taxi licenses at existing levels,
in hopes of curbing an oversupply that had prompted the Legislature to
consider placing the city’s taxis under comprehensive oversight by a
state agency the year before. The cap, however, outlived its usefulness,
and by the 1960s, taxi licenses were a valuable commodity and taxis
themselves scarce in outer boroughs.
Starting in the early 1970s, a series of New York City mayors
sought to address taxi service deficiencies, either by allowing livery cars
to accept street hails in the outer boroughs, increasing the number of
taxi licenses, or both. The taxi industry, however, consistently opposed
any reform it perceived as a threat to the value of a taxi medallion, a
6
value which continued to grow and now tops $1 million. In 2011, Mayor
Michael R. Bloomberg proposed yet another set of reforms that the
industry again opposed.
This time, the Legislature took action, rather than allowing the
persistence of the status quo. By passing the HAIL Act, the Legislature
acted to eliminate the fundamental inequities in street-hail service by
providing access to metered, street-hail vehicles to populations
unserved by the city’s taxis—persons in the outer boroughs and persons
in wheelchairs. The Act (1) creates a new class of up to 18,000 for-hire
vehicle licenses, 20 percent of which are earmarked for wheelchair-
accessible vehicles, that confer the right to accept street hails in the
outer boroughs, but not in central Manhattan or the city’s airports, and
(2) authorized the Mayor to issue up to 2,000 new licenses for
wheelchair-accessible taxis.
The taxi medallion owners—a powerful economic interest group—
opposed the Act, and when they were unsuccessful in preventing its
passage, they and their representatives promptly challenged it in court
on several grounds. Supreme Court erred in striking down the Act on
home-rule grounds because the State Legislature correctly found, with
7
ample record support, that the statute serves the State’s substantial
interest in protecting the welfare, safety, and health of its residents and
visitors, by ensuring access to safe, reliable, and efficient transportation
in and around the State’s—and this nation’s—most populous city.
This Court has long recognized that New York City’s size,
distinctive characteristics, and cultural and commercial importance make
a wide variety of activities there significant not only for the city but also
for the State—an understanding borne out by the number and range of
state statutes on the books that apply to the city alone. Transportation
in New York City, in particular, has been recognized by the Court as an
activity that implicates substantial state concerns: as early as 1912, the
Court rejected a home-rule challenge to the State’s authority to regulate
the city’s subway system, and it has consistently affirmed since then
that transportation in New York City is an area of substantial state
concern.
The Legislature thus identified a substantial state concern as the
basis for the Act, and having done so, it possessed authority to exercise
its judgment and discretion in selecting the means to address the
problem. In striking down the Act, Supreme Court wrongly dismissed
8
the Legislature’s express findings of a substantial state interest, and
improperly treated the history of city regulation of the taxi industry as
somehow disempowering the Legislature from acting to remedy the
serious problems it found to exist. Supreme Court also mischaracterized
the Act’s reasonable solutions to persistent and widespread problems in
the city’s taxi industry as “meddling” by the Legislature and Governor
in an internal battle between the Mayor and City Council.
Neither the history of local taxi regulation nor the politics
surrounding the Act negate the State’s substantial interest in ensuring
that safe and reliable transportation is available to residents and
visitors in the outer boroughs of New York City and to disabled persons
in New York City. The State is not barred from intervening in a matter
formerly left to municipal control when local regulation has failed to
solve problems of substantial importance to the State. Nor does the
Home Rule Clause, as Supreme Court held, subject state legislative
action to broad judicial second-guessing as to whether each and every
particular legislative judgment reflected in a statute furthers a
substantial state interest in the least-restrictive means conceivable.
9
Supreme Court also erred in concluding that the HAIL Act grants
a monopoly prohibited by the Exclusive Privileges Clause in article III,
§ 17, of the State Constitution. The new outer-borough HAIL licenses
will be available to a large class of qualified operators in competition
with each other, and the privilege they will receive—the right to accept
street hails in the outer boroughs—is one that taxi medallion owners
themselves already enjoy. Their attempt to invoke the Exclusive
Privileges Clause to preserve the exclusivity of their own privilege is
wholly without merit.
ISSUES PRESENTED
1. Did the home-rule provisions of the State Constitution limit
the Legislature’s authority to pass the HAIL Act, upon detailed
legislative findings, to ensure safe and reliable transportation for New
York City’s underserved residents and visitors, including those with
disabilities?
Supreme Court struck down the statute, holding that the Act does
not advance a substantial state interest.
10
2. Did the Legislature violate the Exclusive Privileges Clause’s
prohibition on the governmental grant of a monopoly by allowing
existing livery-cab licensees meeting certain qualifications the first
opportunity to obtain, at specified fees, a class of livery licenses created
by the Act and by making such licensees eligible for government grants
to defray the costs of buying wheelchair-accessible vehicles or
retrofitting existing vehicles?
Supreme Court held that the Act conferred an impermissible
exclusive privilege on livery-cab licensees.
STATEMENT OF THE CASE
New York City is the dominant population and economic center in
New York State and a key point of entry to the State and nation. Over
40 percent of the State’s 19 million residents live in New York City,2
and two-thirds of the State’s residents live in the city’s metropolitan
2 See Empire State Dev., Census 2010 Data, http://esd.ny.gov/
NYSDataCenter/Data/Census2010/PL2010Tab1NY.pdf.
11
area.3 More than three-quarters of a million non-New York City
residents commute into the city each day for work.4 As a world center of
tourism, the city also hosts tens of millions of domestic and
international visitors a year. In 2011, for example, over 50 million
people visited New York City,5 and in 2010, the city hosted nearly one-
third of all international travelers to visit the United States.6 New York
City accounted for nearly two-thirds of the $54 billion spent by travelers
statewide and two-thirds of the more than $3 billion the State collected
in tourism-generated taxes in 2011.7
3 See Nelson A. Rockefeller Inst. of Gov’t, 2010 New York State
Statistical Yearbook, tbl. A-5, available at http://www.rockinst.org/
nys_statistics/2010/1-88.pdf.
4 Jason Bram & Alisdair McKay, The Evolution of Commuting
Patterns in the New York City Metro Area, 11 Current Issues in Econ. &
Fin. 2-3 (Oct. 2005), available at http://www.newyorkfed.org/research/
current_issues/ci11-10.pdf.
5 See N.Y. City, NYC Statistics, http://www.nycgo.com/
articles/nyc-statistics-page.
6 Anastasia Xenias & Ron Erdmann, International Travel and
Tourism Exports and the New York Economy 3, Weissman Ctr. for Int’l
Bus. Occasional Paper Series (Oct. 2011), available at
http://uscib.org/docs/WCIB%20Occasional%20Paper%20NY%20Tourism
%20Exports%20%282%29.pdf.
7 Tourism Economics, The Economic Impact of Tourism in New
York: 2011 Calendar Year Hudson Valley Focus 23, 27, available at
(continued on the next page)
12
Taxicabs are a central part of the transportation system that
serves these millions of residents, commuters, and tourists. Taxis in
New York City are a billion-dollar industry responsible for the
transportation of nearly 240 million riders a year. (T274, T278.8) Given
the city’s exceptionally high degree of urbanization, most of the city’s 8
million residents do not own cars, and many of those who own cars do
not use them as a primary mode of transportation.9 For the residents of
the city, taxis provide an important means to conduct the business of
daily life, offering safe, reliable, and convenient transportation to and
from jobs, medical appointments, grocery stores, restaurants, sporting
events, and theaters, to give just a few examples. Many commuters who
reside outside the city also rely on taxis to get around the city while
http://www.rocktourism.com/images/pdf/NYS-Tourism-Impact-Hudson-
Valley.pdf.
8 Unless otherwise indicated, numbers inside parentheses
preceded by the letter “G,” “M,” or “T” refer, respectively, to pages in the
Record on Appeal for Greater New York Taxi Association v. State,
Metropolitan Taxicab Board of Trade v. Bloomberg, or Taxicab Service
Association v. State. For ease of reference, materials are cited only to
the Taxicab Service Association record unless found exclusively in
another record.
9 See N.Y. City Econ. Dev. Corp., New Yorkers and Cars,
http://www.nycedc.com/blog-entry/new-yorkers-and-cars.
13
they are there. Visitors to the city likewise depend on taxis—hotel
guests rely particularly heavily on them (T136 (¶ 21)).
In addition to transporting people within New York City, taxis
also take people to points outside the city.10 Taxis are also an important
adjunct to the transportation networks that connect New York City to
other cities and other countries; people frequently rely on taxis to take
them to and from airports, train stations, and the like. For example,
more than one-third of air passengers traveling to LaGuardia Airport in
2002, and approximately one-fourth of those traveling to John F.
Kennedy International Airport, arrived by taxi. (T283.) Taxis thus
provide more than purely local transportation, directly contributing to
New York City’s status as a leading regional, national, and global travel
destination.
10 The Taxi and Limousine Commission’s Medallion Taxicab
Passenger Bill of Rights specifically lists the right to go to “any
destination in NYC, Westchester, Nassau, or Newark Airport,” and
standard rates apply for trips to any of these destinations. See
http://www.nyc.gov/html/tlc/html/passenger/taxicab_rights.shtml; TLC,
Rate of Fare, http://www.nyc.gov/html/tlc/html/passenger/
taxicab_rate.shtml.
14
A. The Taxi Medallion Industry in
New York City
Under existing law, the right to pick up passengers for hire in the
streets or arriving at New York City’s airports belongs exclusively to
holders of taxi medallions (metal plates evidencing a license that must
be affixed to any vehicle operated as a taxicab). N.Y. City Admin. Code
§ 19-502(l) (2011); T107 (Act § 4(c)); T112 (Act § 11). Medallion taxis,
which must be painted yellow, charge uniform rates set by law, which
are calculated by taximeters installed in each vehicle. N.Y. City Admin.
Code §§ 19-502(k)-(l), 19-514(a) (2011); 35 Rules of City of N.Y. § 58-38
(2012). These meters and the right to accept street hails distinguish
medallion taxis from livery cars, another class of for-hire vehicles
licensed by the city’s Taxi and Limousine Commission (TLC) to accept
passengers by prearrangement, in person or by phone. 35 Rules of the
City of N.Y. § 59A-03(e)(2), (j)-(k) (2012).
Today, a taxi medallion is an enormously valuable asset. This was
not always so, as a brief review of the history of taxis in New York City
will demonstrate.
15
1. The restriction of taxi medallion
supply in the 1930s
Eighty years ago, New York City was glutted with taxis, leading
to traffic congestion, fare wars, low driver wages, and inadequately
insured vehicles. (T295.) Though the State had authorized the city to
license taxis as part of its charter, licensing had not prevented or solved
these problems. See Matter of Rudack, 163 Misc. 326, 327-28 (Sup. Ct.
N.Y. County), aff’d, 274 N.Y. 615 (1937).
In 1936, the state government undertook an extensive
investigation of the taxi system and concluded that further regulation
was needed. A joint resolution of the New York State Legislature
declared that “[s]afe, adequate and efficient taxicab operation at just
and reasonable rates is an indispensable transportation service
auxiliary to rapid transit and other transportation systems in large
cities in this State.” 1936 Legis. Doc. No. 83, at 3. The joint committee
created by this resolution proposed to place the taxi industry under the
jurisdiction of the Transit Commission, the state authority that
regulated the city’s buses, and recommended that the number of taxi
licenses be capped at the existing level, subject to increase as necessary
16
in the public interest. Matter of Rudack, 163 Misc. at 329; 1936 Legis.
Doc. No. 83, supra, at 20-21, 49-57.
The state legislative proposal was not adopted, however, and the
city government took first action to address the problem. In 1937, the
city passed an ordinance known as the Haas Law. Consistent with the
recommendation of the Legislature’s joint committee, the Haas Law
capped the number of taxi medallions at the number then outstanding,
which was 13,595. Nine months later, the Legislature codified the
provisions of the Haas Law as part of a recodification and amendment
of the New York City Administrative Code. See ch. 929, § 1, 1937 N.Y.
Laws (vol. II) 1, 262-63 (adopting § 436-2.0). The Legislature would
later authorize all cities, towns, and villages in the State to limit the
number of taxi licenses for operation within the locality and to regulate
certain other aspects of taxi operation. See ch. 209, 1956 N.Y. Laws 901
(codified at General Municipal Law § 181).
The Haas Law in New York City focused on limiting taxi supply
because there were far too many taxis in the city at the time. Few
contemplated that the opposite problem might someday arise. As one of
the Haas Law’s drafter’s explained: “No one foresaw that these licenses
17
would ever be valuable.” Edward G. Rogoff, Regulation of the New York
City Taxicab Industry, City Almanac 1, 4 (Aug. 1980) (internal
quotation marks omitted). Indeed, the number of taxi medallions fell to
11,787 following the law’s passage, as owners who could not earn a
living declined to renew their medallions and no replacements were
issued. Rogoff, supra, at 4.11
2. Market distortion and resistance to reform in
the taxi industry in recent decades
Since the passage of the Haas Law in 1937, the population of the
New York metropolitan area has increased significantly,
suburbanization has led to the creation and growth of a commuter
culture, the automobile has achieved far greater prominence as a means
of transportation, and the rise of affordable air travel has greatly
increased tourism and business travel into New York City. Yet the
number of taxi medallions in circulation in New York City has never
again reached the number that existed in 1937.
11 As a matter of local law in New York City, the power to set the
number of licenses was exercised by the police department until 1971,
when it was transferred to City Council. See N.Y. City Local Law No. 12
(1971); N.Y. City Charter § 2303(b)(4).
18
Following World War II, taxi medallions started to increase in
value. (T311.) By the 1960s, the cap on the number of medallions had
become “an impediment to the taxi industry’s ability to meet New
York’s growing transportation needs,” particularly in the outer
boroughs. (T296.) In 1963, 77.7 precent of all trips originated in
Manhattan, and taxis were scarce in Brooklyn, Queens, and the Bronx.
(T296.) The livery industry and unregulated gypsy cabs soon appeared
to fill the void in the city’s poorer and outlying areas, including several
African-American neighborhoods. (T297; Rogoff, supra, at 7.)
Efforts to correct the city’s taxi imbalance either by increasing the
number of medallions or allowing livery cars to accept street hails
repeatedly foundered in the ensuing decades. Following the creation of
the Taxi and Limousine Commission in 1971, New York City Mayor
John Lindsay urged a proposal to install meters in livery cars and allow
them to pick up passengers at the airports and in outlying areas, but
the plan met with stiff resistance from medallion owners who feared
infringement on their business, and it was dead by October 1972. Rogoff,
supra, at 7-8.
19
Similarly, a 1982 report by the Mayor’s Committee on Taxi
Regulatory Issues proposed allowing livery cars to pick up metered
fares north of 96th Street and in the outer boroughs, but again the
medallion industry opposed the measure.12 Further, Mayors Ed Koch
and David Dinkins both proposed increasing the number of medallions,
but those proposals again did not pass the City Council. (T136 n.4,
T1573.)
Over time, the taxi medallion industry experienced growing
consolidation. Today, about twenty-five wealthy multigenerational
families and other owners hold about half the medallions in New York
City. (T305.) This bloc of powerful economic interests wields
considerable political influence within New York City. (T1573.) The city
government has issued additional taxi medallions only sparingly and in
quite small numbers.13 Today there are just 13,237 medallions, leaving
12 See Ari L. Goldman, Taxi Panel, After Yearlong Study, Offers 73
Ways To Improve Service, N.Y. Times, Mar. 30, 1982, at A1; Bruce
Schaller, The New York City For-Hire Vehicle Fact Book (1993),
http://www.schallerconsult.com/taxi/fhv_fb.htm.
13 The city may not auction taxi medallions at market value
without state authorization because issuance of a license at greater
than administrative cost constitutes a tax under state law. See City of
(continued on the next page)
20
New York City with half as many taxis per capita as either London or
Chicago.14 The going rate to buy a medallion is $700,000 if the taxi is
individually owned and $1 million if corporately owned. (T140, 141-42
(¶¶ 31, 38).) The driving of taxis, meanwhile, is done overwhelmingly by
immigrants from the developing world—some 90 percent of drivers were
born outside the United States—most of them in South Asia, Africa,
Haiti, or a former Soviet Republic. (T326.)15
The inequalities and service deficiencies that emerged many
decades ago have persisted and worsened. Today, about 95 percent of all
Buffalo v. Stevenson, 207 N.Y. 258 (1913); 1986 N.Y. Op. Att’y Gen.
(Inf.) 6. In the handful of instances where city government has
requested the power to auction additional medallions, the Legislature
has authorized such auctions on an ad hoc basis. See ch. 359, § 1, 1995
N.Y. Laws 3144, 3145; ch. 63, pt. I, § 1, 2003 N.Y. Laws 2543, 2560; ch.
535, § 1, 2006 N.Y. Laws 3432, 3432. The State has never granted the
city any general power to tax the issuance of taxi medallions.
14 N.Y. City Taxi & Limousine Comm’n, Taxi Medallion Increase
Draft Environmental Impact Statement (2012), at ES-4, available at
http://www.nyc.gov/html/tlc/downloads/pdf/taxi_medallion_increase.pdf.
15 See also Competition Comm., OECD, Taxi Services: Competition
and Regulation 8 (2007) (“OECD Report”) (“[T]here is no evidence to
suggest that taxi driver incomes are higher in markets with restrictive
entry conditions. Rather, the monopoly rents that accrue due to these
restrictions appear to be appropriated solely by licence owners.”),
available at http://www.oecd.org/regreform/liberalisationandcompe
tition interventioninregulatedsectors/41472612.pdf.
21
medallion pickups occur either at an airport or in Manhattan south of
West 110th Street or East 96th Street. (T131 (¶ 4).) That area excludes
neighborhoods accounting for more than 80 percent of the city’s
residents—about 6 million people—and approximately 9,000 of its hotel
rooms, more than a quarter of which were built over the last four years.
(T136 (¶ 21); Xenias & Erdmann, supra, at 9.)
The demand for curbside service in these areas continues to be
filled by livery cars and gypsy cabs unlawfully accepting street hails,
which occurs more than 150,000 times per day. (T34 (¶ 84).) These
riders continue to be denied the basic assurances that come with hailing
a medallion taxi, including “adequately insured vehicles, accurately
calibrated meters, properly licensed drivers, and . . . disciplinary
recourse for passengers who may have been mistreated.” Rogoff, supra,
at 18.
The taxi system in New York City is also failing disabled residents
and visitors citywide. See Noel v. N.Y. City Taxi & Limousine Comm’n,
687 F.3d 63, 74 (2d Cir. 2012) (describing the lack of meaningful access
to New York City cabs for people in wheelchairs as “a failure of the taxi
22
industry”), rev’g 837 F. Supp. 2d 268 (S.D.N.Y. 2011).16 Only 1.8 percent
of taxis—just over 230 cabs—are wheelchair-accessible. (T106, T140
(¶ 31).) While an able-bodied person generally can successfully hail a
taxi in central Manhattan within ten minutes 87.33 percent of the time,
a person requiring a wheelchair-accessible taxi can succeed in doing so
only 3.3 percent of the time. Noel v. N.Y. City Taxi & Limousine
Comm’n, 837 F. Supp. 2d 268, 271 (S.D.N.Y. 2011), rev’d, 687 F.3d 63
(2d Cir. 2012). A disabled person’s likelihood of hailing an accessible
taxi is worse still outside of central Manhattan, where cabs are scarce.
16 The trial court in Noel held that the lack of meaningful access to
taxi services for persons with disabilities amounted to a violation of the
Americans with Disabilities Act on the part of TLC and entered a
preliminary injunction requiring all new taxi medallions and street-hail
livery licenses to go to wheelchair-accessible vehicles pending court
approval of a comprehensive reform plan. See 687 F.3d at 65. The
Second Circuit reversed on the ground that the ADA did not require
TLC to exercise regulatory authority to remedy the taxi industry’s
failure to provide meaningful access. See id.
23
B. The Legislature’s and Governor’s Efforts To
Broaden Access to Street-Hail Service in New
York City
1. Events leading to the HAIL Act’s passage
In early 2011, New York City Mayor Michael R. Bloomberg
presented a new proposal to the City Council to expand street-hail
service in unserved areas, by licensing livery vehicles to accept street
hails in northern Manhattan and the outer boroughs. (T1343 (¶¶ 3-4.))
As it had in the past, the medallion industry opposed the reform effort.
(T1344 (¶ 7), T1573.)
Between March and May 2011, representatives of the Mayor, the
City Council, and the taxi medallion owners’ lobby engaged in extended
negotiations. (T1288-89 (¶¶ 10-12), T1344 (¶ 8).) Accounts of those
negotiations differ. The medallion owners’ lobbyist says that
negotiations broke down. (T1289-90 (¶ 17).) In contrast, TLC Chairman
David Yassky says the parties agreed on a compromise proposal to
auction new taxi medallions, each of which would be issued together
with one or more separate licenses to operate a special class of taxi
limited to serving the outer boroughs. (T1345 (¶ 9).) That proposal
required action by the Legislature to authorize the sale by auction of
24
new taxi medallions. (See T1289-90 (¶¶ 13-14, 17), T1345 (¶¶ 10-11).)
When the proposal was presented to members of the Legislature in May
and early June 2011, however, several representatives of the outer
boroughs and northern Manhattan expressed concern that the
compromise proposal would not provide appropriate service for their
constituents and would unfairly benefit the taxi industry to the
detriment of the livery businesses already operating in their
communities. (T1348 (¶ 16).)
Subsequently, in mid-June 2011, Assemblyman Carl E. Heastie,
who represents part of the Bronx, and Senator Martin J. Golden, who
represents part of Brooklyn, introduced bills in the Legislature
authorizing the TLC to issue licenses permitting livery vehicles to accept
street hails outside of central Manhattan.17 The bills provided for the
auctioning of new taxi medallions and the issuance of outer-borough
licenses, but, unlike the Mayor’s compromise proposal, did not link the
two. (T1348 (¶ 18).) The Mayor would be authorized to direct the
issuance of up to 1,500 new taxi medallions, of which over a third would
17 See T1348-49 (¶ 19); A. 8496, 234th Sess. (2011); S. 5825, 234th
Sess. (2011).
25
be restricted to use with wheelchair-accessible vehicles. A. 8496, § 2;
S. 5825, § 2. The legislation was endorsed by the City Council’s Latino,
Asian, and Black Caucus18 and enjoyed widespread support from
members of the Legislature representing districts in New York City,
eighteen of whom spoke in favor of it in explaining their votes during
floor debates.19
Assemblyman Robert J. Rodriguez of eastern Harlem, for
example, lauded the Act’s benefits to “communities of color,” stating, “I
live in the sixth Borough of Manhattan, upper Manhattan, and it really
is a tale of two cities and two worlds when you talk about what happens
north of 96th Street and what happens south of 96th Street.” June 21
Tr., supra, at 26-27. Assemblyman Guillermo Linares of northern
Manhattan, a former livery and yellow-cab driver and one of the Act’s
sponsors, described it as a step to “bring fairness for all New Yorkers”
18 N.Y. Senate, Tr. of June 24, 2011 Proceedings, 234th Sess.
(statement of Sen. Martin Malavé Dilan), http://open.nysenate.
gov/legislation/transcript/regular-session-06-24-2011.
19 See Senate Tr., supra; N.Y. Assembly, Tr. of June 21, 2011
Proceedings, 234th Sess., at 13-31 (“June 21 Tr.”), available at
http://assembly.state.ny.us/write/upload/session/2011/20110621.pdf.
26
and give the livery-cab industry “an opportunity to come from the
shadow and be able to serve with dignity.” Id. at 20. A Bronx legislator
remarked, “the last time I saw a yellow cab in my district it was
probably a checker”—a type of taxi not made for decades. Id. at 25
(statement of Assemblyman Jeffrey Dinowitz).
Assemblyman Micah Kellner, representing Manhattan’s Upper
East Side, applauded the Act’s steps to improve access for New Yorkers
with disabilities who have been “left out of yellow taxis for decades”
because they “have just not had access to them.” Id. at 18. He aptly
compared hunting for a wheelchair-accessible taxi to looking for a
unicorn. Id.
The legislation passed the Assembly by a vote of 113-28 on June
21, 2011, and the Senate by a vote of 40-21 on June 24, 2011. The Act
received broad support from New York City’s legislative delegation:
nineteen of the city’s twenty-six senators, and forty-six of its sixty-two
assembly members, voted in favor.20
20 See Rollcall Vote, ch. 602, 2011 N.Y. Laws.
27
Governor Andrew M. Cuomo did not immediately sign the
legislation. In December 2011, the Governor convened a “taxi summit”
among all stakeholders. (T1290 (¶ 20).) The Governor had stressed that
the “optimum goal is to design a plan that provides taxi access to the
outer boroughs, access to the disabled, revenue for the City, and
respects the medallion franchise.” (M183.) After he met with
stakeholders, the Governor agreed to sign the legislation on the
understanding that there would be chapter amendments to add further
provisions for increased access for people with disabilities. (T1290
(¶ 20).)
Thus, on December 21, 2011, the Governor signed the legislation,
while stating in his approval memorandum that the Legislature had
agreed to pass a chapter amendment including provisions to “make the
New York City taxi system more accessible to individuals with
disabilities.” (M181.) On February 17, 2012, about eight months after
the legislation was first proposed, the chapter amendments demanded
by the Governor were passed. (T1352 (¶ 31).) These amendments
required all of the newly authorized taxi medallions to be issued only to
wheelchair-accessible vehicles. (T110 (Act § 8).)
28
2. The HAIL Act’s provisions to improve access
to safe and reliable taxi service for persons in
the outer boroughs and for disabled persons
The Act establishes a new class of livery cab authorized to accept
street hails in all parts of the city other than central Manhattan and
the airports, and significantly expands the number of wheelchair-
accessible taxis and livery cabs citywide.
a. The HAIL Act’s detailed legislative
findings identifying substantial state
concerns
The Act contains detailed and specific legislative findings. The
Legislature declared that access to “safe and reliable” taxi
transportation affects the “public health, safety and welfare of the
residents of the state of New York traveling to, from and within” the
city. (T106 (Act § 1).) The Legislature found that “[t]he majority of
residents and non-residents of the city of New York do not currently
have sufficient access to legal, licensed taxicabs available for street
hails in the city of New York.” (T106 (Act § 1).)
The Legislature further found that “it is a matter of public health,
safety and welfare to ensure adequate and reliable transportation
accessible to individuals with disabilities in the city of New York,”
29
because the current number of accessible vehicles is “insufficient to
provide adequate and reliable transportation for the residents of and
the commuters and visitors to New York city who have disabilities and
therefore inhibits their basic daily activities.” (T106 (Act § 1).) The lack
of accessible vehicles, the Legislature found, “prevents individuals with
disabilities from being able to rely on the street hail system to get to a
destination quickly, particularly in an emergency, or to travel to a
location not near a subway or bus stop.” (T106 (Act § 1).)
b. The HAIL Act’s substantive provisions
to improve transportation access
The Act addresses the problem of insufficient taxi service outside
of central Manhattan by creating a new license, known as a “Hail
Accessible Inter-borough license,” or “HAIL license” (T106-10 (Act §§ 3-
5)), which allows the license holder to accept street hails in the outer
boroughs and in Manhattan above East 96th Street on the East Side
and West 110th Street on the West Side (T107-08 (Act § 4(b)-(c)). Taxis
retain the exclusive right to accept street hails in central Manhattan
and to pick up passengers at the city’s airports. (T107-08, 112 (Act
§§ 4(b)-(c), 11).)
30
The Act directs TLC to issue the HAIL licenses in three annual
installments. (T108-10 (Act § 5).) In the three years following the first
issuance, HAIL licenses may, with limited exceptions, be issued only to
TLC-licensed livery drivers and owners in good standing who have been
licensed for at least one year. (T108-09 (Act § 5(b)).)21 A holder of a
HAIL license may transfer the license to any owner of a livery car
licensed by the TLC or to any livery driver in good standing with the
TLC. (T110 (Act § 7).)
The Act includes multiple provisions to improve access to taxis
and livery cabs for persons with disabilities. First, the Act requires that
20 percent of the HAIL licenses be reserved for accessible vehicles.
(T108-09 (Act § 5(b)).) Second, the HAIL Act provides that “[t]he City of
21 Operation of a livery-car service has three essential components:
(1) the owner of the car must hold a for-hire vehicle license; (2) the
driver of the car must hold a for-hire driver license; and (3) the car must
be affiliated with a licensed base station from which it is dispatched.
N.Y.C. Admin. Code §§ 19-502(t), 19-504(a)(1), 19-505(a)(iii), 19-511
(2011); 35 Rules of City of N.Y. § 59A-03(e)(2), (f)-(g), (j)-(k) (2012).
Under the Act, HAIL licenses will be available to qualifying holders of
either for-hire vehicle licenses or for-hire driver licenses, and each
HAIL-licensed vehicle must similarly be affiliated with a base station
holding a HAIL base permit. (T106-07 (Act § 3 (sec. 4)).) HAIL base
permits will initially be available only to licensed livery base stations in
good standing. (T106-07 (Act § 3 (sec. 4)).)
31
New York, acting by the mayor alone,” may direct TLC to issue up to
2,000 new taxi medallions, all of which must be used only for accessible
vehicles. (T110 (Act § 8).) Third, the law directs the TLC to “establish a
program to support the introduction of accessible vehicles into the HAIL
vehicle fleet” by providing up to $54 million in grants or discounted
vehicles to HAIL licensees. (T111 (Act § 9(b)).) Fourth, the law requires
the TLC to prepare and submit to the state Department of
Transportation a “disabled accessibility plan” to increase accessibility of
the HAIL-vehicle fleet over time. (T111-12 (Act § 10).)
The Legislature directed that the provisions of the Act be
“construed as a whole,” and that “[i]f any part . . . shall be adjudged by
any court of competent jurisdiction to be invalid, the remainder of this
act shall be invalidated and shall be deemed to have not taken effect.”
(T107 (Act § 3 (sec. 6)).)
C. The Medallion Owners’ Challenge
to the Legislation
After they were unsuccessful in preventing the HAIL Act’s
passage, representatives of the taxi medallion owners, credit unions
that finance medallion purchases, and a single member of the New York
32
City Council brought three related actions in Supreme Court, New York
County, to enjoin implementation of the Act in its entirety. The lead
plaintiff in the Metropolitan Taxicab Board of Trade (MBTOT) action is
a trade association of taxi fleets. (M227-29 (¶¶ 12-18).) The Taxicab
Service Association, a trade association of credit-union lenders, is lead
plaintiff in a second action (the TSA action) (T20 (¶¶ 12-17)), and the
Greater New York Taxi Association is lead plaintiff in a third action
(the GNYTA action) (G34 (¶¶ 23-24)). Representatives of the livery-cab
industry intervened in all three actions as plaintiffs or as defendants.22
As relevant here, plaintiffs asserted three claims.
First, plaintiffs in all three actions alleged that the Act violates
New York Constitution’s Home Rule Clause, which requires a request
from a municipal government before the Legislature may enact a
special law “in relation to the property, affairs, or government” of the
municipality, unless the law serves a substantial state interest. N.Y.
22 Only municipal parties are named as defendants in the MTBOT
action. The Attorney General intervened in the action under Executive
Law § 71. The TSA and GNYTA actions name both state and municipal
parties as defendants.
33
Const. art. IX, §§ 2(b)(2), 3(d)(1); see, e.g., Wambat Realty Corp. v. State,
41 N.Y.2d 490, 493-94 (1977).
Second, plaintiffs in the MTBOT action asserted that the Act
violates the Double Enactment Clause of the State Constitution, art. IX,
§ 2(b)(1). That provision, added in 1963, directed the Legislature to
enact a Statute of Local Governments and provided that any power
granted in that statute could be “repealed, diminished, impaired or
suspended” by state law only if the law was passed twice by the
Legislature, in succeeding calendar years. Id.
Third, plaintiffs in the MTBOT and GNYTA actions alleged that
the Act violated the Exclusive Privileges Clause, id. art. III, § 17. That
clause bars enactment of a “private or local bill” granting “any exclusive
privilege, immunity or franchise whatever” to “any private corporation,
association or individual.” Id.23
23 Among other claims, the TSA and GNYTA plaintiffs also alleged
that the Act effected a taking of private property without just
compensation and asserted claims under the State Environmental
Conservation Law. Those claims are not at issue in this appeal, because
Supreme Court rejected them (T2166-69) and plaintiffs have not
appealed that determination.
34
D. Supreme Court’s Invalidation of the HAIL Act
Supreme Court granted plaintiffs’ motions for summary judgment
to the extent of holding that the Act violated the Home Rule, Double
Enactment, and Exclusive Privileges Clauses. (T2141.) In ruling in
plaintiffs’ favor on the home-rule and double-enactment claims, the
court concluded that all aspects of taxi regulation in New York City are
matters of solely local concern. (T2163.) The court dismissed as
pretextual the Act’s detailed legislative findings describing the
substantial state interests served by the enactment. (T2157.) The court
held that the Act violates the Exclusive Privileges Clause because it
gives livery drivers meeting certain qualifications the first opportunity
to purchase HAIL licenses. (T2164-65.)
Following the decision, the court entered a final judgment in all
three actions declaring the Act “null, void and unconstitutional.” (G4-
18, M5-10, T5-11.) On consent, the judgment dismissed plaintiffs’
request for attorneys’ fees. (G17, M10, T10.)
35
JURISDICTIONAL STATEMENT
Defendants appealed directly to this Court as of right under
C.P.L.R. 5601(b)(2), because the sole questions presented in the appeal
address the constitutionality of a state statute. (G11-12, M2-3d, T2-3f.)
ARGUMENT
POINT I
THE LEGISLATURE ACTED WELL WITHIN ITS
CONSTITUTIONAL AUTHORITY IN ENSURING
ACCESS TO SAFE AND RELIABLE
TRANSPORTATION FOR MILLIONS OF NEW
YORK CITY RESIDENTS AND VISITORS
The Constitution vests the sovereign legislative authority of the
State of New York in the State Legislature. The Constitution also
authorizes the Legislature to establish cities, villages, and towns within
the State. The home-rule provisions of the State Constitution restrict
the Legislature’s authority to enact legislation only in extremely narrow
circumstances where local concerns alone are implicated and no
substantial state interest is present.
36
This Court has held that under the Home Rule Clause of article
IX, § 2(b)(2), the State Legislature may enact a special law that affects
the “property, affairs or government” of a particular municipality, so
long as the law reasonably serves a substantial state interest. See, e.g.,
Wambat, 41 N.Y.2d at 493-94. If the law does not serve a substantial
state interest, the Legislature may enact it only if the affected
municipal government formally requests the legislation by issuing a
home-rule message.24 Under the Double Enactment Clause of article IX,
§ 2(b)(1), the Legislature generally may enact a special law limiting an
enumerated power granted to localities by the Legislature in the
Statute of Local Governments (codified at chapter 58-A of the
Consolidated Laws) only by passing the law on two separate occasions,
in successive calendar years. Like the Home Rule Clause, the Double
24 For the purpose of article IX, a “general law” is one that applies
to all cities, whereas a “special law” is one that “in terms and in effect
applies to one or more, but not all, . . . cities.” N.Y. Const. art. IX,
§ 3(d)(1), (4). The Legislature may pass special laws relating to the
“property, affairs, or government” of any locality other than New York
City without a home-rule message if the Governor recites facts
constituting an emergency and the legislation garners a two-thirds
majority vote in both the Senate and the Assembly. Id. § 2(b)(2).
37
Enactment Clause does not restrict the Legislature’s authority to enact
a statute that rationally advances a substantial state interest.
The HAIL Act does not violate either the Home Rule Clause or the
Double Enactment Clause because, as shown below, the legislation
reasonably advances the substantial state interest in ensuring that
millions of residents and visitors have access to safe and reliable
transportation in New York City.
A. The HAIL Act Directly and Rationally
Serves Substantial State Interests.
The Court has recognized that “the fount of the police power is the
sovereign State,” People v. De Jesus, 54 N.Y.2d 465, 468 (1981), and
that the Home Rule Clause in the Constitution does not diminish the
“untrammeled primacy of the Legislature to act, as it always ha[s], with
respect to matters of State concern,” Wambat, 41 N.Y.2d at 497. The
clause does not limit the Legislature’s ability to address a “matter of
proper concern to the State government,” Matter of Town of Islip v.
Cuomo, 64 N.Y.2d 50, 52 (1984), even if “the concern of the State may
also touch upon local matters,” Matter of Kelley v. McGee, 57 N.Y.2d
522, 538 (1982). Further, acts of the Legislature enjoy a strong pre-
38
sumption of constitutionality that “can be upset only by proof
persuasive beyond a reasonable doubt.” Hotel Dorset Co. v. Trust for
Cultural Resources, 46 N.Y.2d 358, 370 (1978).
Applying these principles, this Court has consistently upheld state
laws that apply only within a particular city where a substantial state
interest is rationally served by the legislation. The Court has rejected
home-rule challenges to a wide range of special legislation addressed at
conditions in New York City, including laws regulating tenements,
Adler v. Deegan, 251 N.Y. 467, 478 (1929); exempting certain buildings
from city rent control laws, City of N.Y. v. State, 67 Misc. 2d 513, 514
(Sup. Ct. N.Y. County 1971), aff’d, 31 N.Y.2d 804 (1972); addressing
unemployment within the city, N.Y. Steam Corp. v. City of N.Y., 268
N.Y. 137, 148-49 (1935); assisting the city’s ability to fund its pension
and retirement liabilities, Bugeja v. City of N.Y., 24 A.D.2d 151, 151 (2d
Dep’t 1965), aff’d, 17 N.Y.2d 606 (1966); regulating the city’s collective
bargaining with its employees, Patrolmen’s Benevolent Ass’n of the City
of N.Y. Inc. v. City of N.Y., 97 N.Y.2d 378, 386-87 (2001) (“PBA II”); and
regulating its subway system, see McAneny v. Bd. of Estimate &
Apportionment, 232 N.Y. 377, 393 (1922); Admiral Realty Co. v. City of
39
N.Y., 206 N.Y. 110, 140 (1912). On similar grounds, the Court has also
upheld special legislation designed to ensure safe drinking water for
Queens, Suffolk, and Nassau Counties, Matter of Town of Islip, 64
N.Y.2d at 52-53, and the transfer of Buffalo’s sewer system to a public
benefit corporation, Robertson v. Zimmerman, 268 N.Y. 52, 60 (1935).
The Court has identified three requirements to uphold special
legislation over home-rule attack: (1) the state’s “interest in the subject
matter must be substantial”; (2) “the enactment must bear a reasonable
relationship” to the state concern; and (3) the presence of state concerns
must not “be derived . . . purely from speculative assertions on possible
State-wide implications of the subject matter, having no support in the
language, structure, or legislative history of the statute.” City of N.Y. v.
Patrolmen’s Benevolent Ass’n of the City of N.Y. Inc., 89 N.Y.2d 380, 391
(1996) (“PBA I”); see also id. (state legislation affecting local concerns
cannot be justified “based purely on considerations having no apparent
role in its enactment, no matter how plausibly conceived as an
afterthought”).
Consequently, unlike other state laws that may be upheld if they
bear any conceivable rational relation to a legitimate end, special state
40
legislation affecting matters of local concern will not be sustained based
on merely a hypothetical connection to a state interest. Instead, the
substantial state concerns invoked to support the state law in litigation
must be grounded in the legislative record compiled at the time of the
statute’s enactment.
In the exceedingly rare cases where this Court has struck down
special state legislation under the Home Rule Clause, the invalidated
laws have directly regulated the city’s relations with its own employees,
and the Court has emphasized the absence of findings or other material
in the legislative record demonstrating that the law reasonably served
any state concern. See PBA I, 89 N.Y.2d at 392-94 (striking down state
law transferring from a city agency to a state agency the responsibility
to oversee impasse arbitration between New York City and its
unionized city employees); Matter of Osborn v. Cohen, 272 N.Y. 55, 60
(1936) (striking down state law regulating the structure and control of
New York City’s municipal fire department).25
25 In addition to these two cases, this Court also invalidated a
state law on home-rule grounds in In re Elm Street, 246 N.Y. 72 (1927).
That case is inapposite. The state law invalidated there extended the
(continued on the next page)
41
In sharp contrast, the HAIL Act, on its face, is a police-power
regulation designed to promote the welfare, health, and safety of both
residents and visitors in New York City by ensuring their access to
reliable and effective transportation to, from, and within the city. The
Legislature enacted specific and detailed findings affirming that public
health, safety, and welfare are currently impaired by lack of access to
street-hail service in the outer boroughs and the lack of wheelchair-
accessible vehicles available for street hails citywide. The underlying
facts demonstrating the deficiencies in such access are undisputed. The
statute reasonably promotes the Legislature’s substantial state
objectives by creating a class of for-hire vehicles that may accept street
hails in the outer boroughs but nowhere else, by requiring that a
substantial proportion of those vehicles be accessible to disabled
persons, and by authorizing issuance of up to 2,000 additional taxi
medallions, all of which must be granted to accessible vehicles. Because
statute of limitations to allow a private corporation to collect a twenty-
five-year-old condemnation award against New York City that stemmed
from the city’s widening of a street. Id. at 74-76.
42
the statute rationally serves a substantial state interest, the statute
comports with the Constitution’s Home Rule Clause.
1. The Legislature made detailed findings
demonstrating that the HAIL Act serves
substantial state concerns.
The Legislature enacted detailed findings in § 1 of the HAIL Act
demonstrating the substantial state concerns served by the
legislation.26 The Legislature specifically found: (1) access to “safe and
reliable” taxi transportation affects the “public health, safety and
welfare of the residents of the state of New York traveling to, from and
within the city of New York”; (2) “[t]he majority of residents and
nonresidents of the city of New York do not currently have sufficient
access to legal, licensed taxicabs available for street hails in the city of
New York”; (3) “it is a matter of public health, safety and welfare to
ensure adequate and reliable transportation accessible to individuals
26 Similar factors to those that demonstrate the substantial state
interest making the Home Rule Clause inapplicable also arguably make
this a law that does not relate to the “property, affairs or government”
of New York City within the meaning of the clause. Because the
presence of a substantial state interest here defeats the home-rule
claim, we do not separately address whether the Act relates to the
property, affairs, or government of the city.
43
with disabilities in the city of New York”; (4) the current number of
accessible vehicles is “insufficient to provide adequate and reliable
transportation for the residents of and the commuters and visitors to
New York city who have disabilities and therefore inhibits their basic
daily activities”; and (5) the lack of accessible vehicles “prevents
individuals with disabilities from being able to rely on the street hail
system to get to a destination quickly, particularly in an emergency, or
to travel to a location not near a subway or bus stop.” (T106 (Act § 1).)
See also supra 25-26 (citing speeches by legislators in floor debates
explaining how the legislation advances the welfare of persons in the
outer boroughs and persons with disabilities).
The language and structure of the HAIL Act, moreover, show that
the statute “rationally serve[s]” the substantial state concerns identified
by the Legislature. PBA II, 97 N.Y.2d at 388. The Act significantly
improves access to street-hail vehicles in the outer boroughs by creating
the HAIL license, which will authorize licensees to accept street hails
solely in the outer boroughs. (T107-08 (Act § 4).) Because HAIL
licensees, unlike taxi medallion holders, will be unable to accept street
hails in central Manhattan or pick up passengers at the airports, HAIL
44
licensees will focus on street hails in the outer boroughs, areas that
taxicabs presently ignore. The HAIL licensing scheme will bring under
legal supervision a street-hail market that currently operates
underground, thereby ensuring open access, requiring consistency and
disclosure in rates, and otherwise ensuring that operators are properly
regulated for the safety and welfare of persons in the outer boroughs.
The Act significantly improves access to street-hail service for
persons with disabilities by authorizing issuance of up to 2,000
additional taxi medallions, all of which must be granted to accessible
vehicles, and by requiring that 20 percent of the newly issued HAIL
licenses, representing up to 3,600 licenses, must be granted to
accessible vehicles. (T108-09 (Act § 5).) These provisions will
substantially increase the number and proportion of vehicles available
for street hails that are wheelchair-accessible. (T140 (¶ 31); June 21 Tr.,
supra, at 18 (statement of Assemblyman Micah Kellner).)
In the decision below, Supreme Court gave no weight to the
Legislature’s express and detailed findings concerning the substantial
state concerns served by the statute or the obvious relationship between
the statute’s provisions and those identified state interests. But this
45
Court has specifically encouraged the Legislature to enact such findings
identifying the state concerns when it passes legislation that arguably
also affects matters of local concern. The Court has made clear it
“relie[s] upon the stated purpose and legislative history of the act in
question” to find, or reject, a substantial state concern. PBA I, 89
N.Y.2d at 392. The Court has also said that “the wisdom” of the
Legislature’s determinations as to the presence of state concerns is “not
for court review.” PBA II, 97 N.Y.2d at 388 (quotation marks omitted).
The presence of express legislative findings thus made the
difference when this Court upheld a state law that transferred
authority from a city to a state agency to arbitrate labor disputes
between New York City and its employees’ unions, id. at 387-88, after
having struck down a similar law on home-rule grounds five years
before, PBA I, 89 N.Y.2d at 393-94. The Court in PBA II emphasized
that the substantial state interest was “expressed” in the enactment at
issue there, whereas the earlier statute had lacked “an expressly
identified State interest” and failed to reasonably serve an interest in
uniformity that was discussed in its legislative history. 97 N.Y.2d at
388-89.
46
In Osborn, too, the absence of a legislative record supporting the
presence of state concerns was critical. The law at issue directed a New
York City referendum as to whether to restrict the shifts and hours of
city firemen. The law’s defenders hypothesized a connection between
the statute and the police power, saying that restrictions on shifts and
hours could advance public health and safety by reducing city firemen’s
working hours and thereby limiting the physical and mental strains of
the job for the greater protection of the public. The Court rejected this
posited chain of reasoning, refusing to accept “a conclusion so drily
logical drawn from asserted facts without foundation in the record.”
Osborn, 272 N.Y. at 59.
The HAIL Act, unlike the laws struck down in PBA I or Osborn,
does not regulate the city’s relationship to its employees or the city’s
own internal affairs, but rather, is a police-power regulation of a private
industry serving the public, that is enacted to ensure residents’ and
visitors’ welfare, health, and safety. And the Act is supported by express
legislative findings detailing the substantial state interests that the
statute reasonably serves. The statute therefore is fully consistent with
the home-rule doctrine.
47
2. The Legislature’s express findings as to
substantial state concerns are factually well-
grounded and supported by this Court’s
home-rule precedents.
The Legislature’s express findings in the HAIL Act are further
supported by undisputed facts and long-standing home-rule precedent.
The City of New York is by far the dominant population center in New
York and the engine of the State’s economy. The City contains 8 million
residents, over 40 percent of New York’s population, and hosts over
750,000 commuters daily and over 50 million visitors annually. See
supra 47.
Nearly eighty years ago, this Court, citing New York City’s
enormous population and centrality to the State’s economy, observed
that “[a]nything that affects the health and the welfare of the city of
New York, touches almost directly the welfare of the State as a whole.”
N.Y. Steam Corp., 268 N.Y. at 143 (quotation marks omitted). The
Court has reiterated the point many times since. See Matter of Town of
Islip, 64 N.Y.2d at 57 (upholding special legislation and noting that
Nassau, Suffolk, and Queens Counties comprise “a substantial portion
of the State’s population” and “encompass[] a substantial portion of the
State’s commerce and industry”); PBA II, 97 N.Y.2d at 388 n.* (“the
48
public health and safety of the people of the City of New York” is a
substantial state interest); Uniformed Firefighters Ass’n v. City of N.Y.,
50 N.Y.2d 85, 91 (1980) (“it has long been recognized that New York
City and other large municipal centers might reasonably receive
different treatment” from smaller localities within New York).
The Court has rejected home-rule challenges to a wide range of
state legislation addressed only to the distinctive conditions in New
York City. See Adler, 251 N.Y. at 478 (tenements); City of N.Y., 31
N.Y.2d at 805, aff’g, 67 Misc. 2d 513 (rent control); N.Y. Steam Corp.,
268 N.Y. at 148-49 (unemployment); Bugeja, 17 N.Y.2d 606, aff’g 24
A.D.2d 151 (funding of pension obligations); PBA II, 97 N.Y.2d at 386-
87 (impasse arbitration in collective bargaining with public employees).
And the Legislature has enacted numerous other statutes that are
limited in application to New York City alone without following home-
rule procedures, without drawing any challenge to the statutes’
constitutionality. See Addendum (collecting a sample of such statutes).
The Court has in particular recognized that transportation in New
York City is a matter of substantial state concern. In Admiral Realty
Co., it upheld as benefiting “the public at large” a state statute
49
regulating the New York City subway system, 206 N.Y. at 140, even
though the lines were “already half municipally owned,” Adler, 251 N.Y.
at 472-73. Ten years after Admiral Realty, the Court reiterated that
“[r]apid transit for the city of New York has, for many years, been a
matter of public interest, affecting not only the people of that city, but of
the whole state. It has been generally regarded as a state affair.”
McAneny, 232 N.Y. at 393; see also Metro. Transp. Auth. v. County of
Nassau, 28 N.Y.2d 385, 389-91 (1971) (rejecting home-rule challenge to
law creating Metropolitan Transportation Authority). Supreme Court
below read Admiral Realty and McAneny to stand only for the notion
that railways, but not taxis, were a matter of state concern. (T2159.)
But this Court has never said that these cases were limited to rail
service. To the contrary, the Osborn Court described them simply as
cases about “[t]ransportation” in New York City. 272 N.Y. at 59.
Moreover, the lower court’s sharp distinction between rail service
and taxi service is unfounded. Supreme Court focused on the notions
that railways are publicly operated and cross city boundaries
(notwithstanding that the city’s subways were once in private hands
and that taxis, too, regularly leave the city). (T2158-59.) But this
50
Court’s past decisions have not turned on these details—which are
immaterial to the key point that the State has a substantial interest in
ensuring that there is a safe and reliable transportation network in
New York City. The ability to navigate the city is essential to allowing
the millions of people who live in, work in, and visit the city to address
day-to-day needs, enjoy the attractions of city life, and conduct business.
The difficulty and expense of owning, using, and parking a private
automobile in New York City means that transportation services,
whether by rail, bus, or taxi are essential to mobility within, to, and
from New York City. Taxi service complements bus and subway service,
and, together, these services create a safe and reliable transportation
network throughout the city. This is not a novel concept: in its 1936
joint resolution addressing the problem of excess taxi supply that New
York City faced at the time, the Legislature declared that “[s]afe,
adequate, and efficient taxicab operation at just and reasonable rates is
an indispensable transportation service auxiliary to rapid transit and
other transportation systems in large cities in this State.” 1936 Legis.
Doc. No. 83, supra, at 3 (emphasis added).
51
Supreme Court’s misguided attempt to set taxis apart from the
other parts of the city’s transportation system—contrary to even
plaintiffs’ statement that taxis are “a critical component of mass
transportation in New York City” (M300)—is typical of its effort to
trivialize the serious problems the Act is designed to address. For
example, the court dismissed the State’s concern as one of “taxicab
availability,” rather than access to transportation. The court then
purported to distinguish that concern from the State’s interests in
public health and housing by hypothesizing that the mass death of the
population of New York City would be a “catastrophe,” and the
disappearance of all housing in the city a “disaster,” whereas the
disappearance of taxis would supposedly be a mere “hardship.” (T2158.)
This absurd comparison ignores that the city’s population need not
be menaced with annihilation, or a total lack of shelter, before the State
is authorized to address problems affecting public health or housing. In
fact, in Hotel Dorset, this Court deemed the finances of the Museum of
Modern Art alone sufficient to warrant legislation in furtherance of the
State’s substantial interest in cultural institutions. See 46 N.Y.2d at
373. So, too, the city need not be threatened with a total disappearance
52
of transportation before addressing a profound dysfunction in a major
segment of the city’s transportation network. Taxis, trains, buses, and
ferries make it possible for millions of people living in and visiting New
York to access housing, healthcare, jobs, education, cultural
institutions, and manifold other pursuits in which the State
indisputably has substantial interests.
Supreme Court purported to summarize the concerns addressed
by the Act as a problem of “Bronx residents [who] can’t find wheelchair-
accessible taxicabs to take them to Yonkers Raceway.” (T2157.) This
does not begin to cover the deficiencies the Act actually addresses. It is
undisputed that taxis are not readily available in huge swaths of the
city, including the large majority of its black, Latino, and immigrant
communities.27 Staten Island has nearly half a million residents, and
the Bronx is home to more than 1.3 million people.28 Brooklyn and
Queens are even larger. Each has more than 2.2 million residents—they
27 See Ford Fessenden & Sam Roberts, Then as Now—New York’s
Shifting Ethnic Mosaic, N.Y. Times, Jan. 22, 2011, available at
http://www.nytimes.com/interactive/2011/01/23/nyregion/20110123-nyc-
ethnic-neighborhoods-map.html.
28 See Empire State Dev., Census 2010 Data, supra.
53
would be the fourth and fifth largest cities in the United States,
respectively, if they were stand-alone cities.29 Nor is there any dispute
that taxi service is not realistically available today for persons in
wheelchairs: only 1.8 percent of the taxis in New York are presently
wheelchair-accessible. Moreover, the populations unserved and
underserved by the existing taxi industry—persons in the outer
boroughs and disabled persons—are also those least able to meet their
transportation needs through subway or bus service. (T1449-50 (¶ 14).)
Because of these deficiencies, residents, commuters, and visitors
to the outer boroughs and other parts of the city currently support an
underground street-hail market of tens of millions of rides per year.
This arrangement harms passengers, who are exposed to inconsistent
and potentially extortionate pricing and other misconduct, and it
disserves drivers of livery vehicles and gypsy cabs, who are denied the
opportunity to earn legitimate income providing a service for which
there is obvious demand but no available and lawful supply. TLC
29 See U.S. Bureau of the Census, The 2012 Statistical Abstract 34-
35, tbl. 27, available at http://www.census.gov/compendia/statab/
2012/tables/12s0027.pdf.
54
estimates that demand for street-hail service in the outer boroughs is
likely to increase some 20 percent if lawful metered street-hail service is
available in livery cars. (T136 (¶ 20).) These points further support the
Legislature’s reasonable conclusion that the HAIL Act serves
substantial state interests.
B. Supreme Court’s Reasons For Dismissing
the Substantial State Interests at Issue
Here Do Not Withstand Scrutiny.
In rejecting the Legislature’s express findings that the HAIL Act
furthers a substantial state interest, Supreme Court focused heavily on
the history of local regulation of the taxi industry, the political process
that led to passage of the Act, and a perceived lack of proportionality
between the Act’s requirements and the state interests identified by the
Legislature. (T2155-57.) None of these factors undermines the State’s
interest in the legislation or renders the statute unconstitutional under
the Home Rule Clause.
55
1. New York City’s history of regulating taxis
does not disable the State Legislature
from acting in furtherance of a substantial
state interest.
In determining that the demonstrated deficiencies in New York
City taxi service do not present a “substantial State concern
transcending local interests,” Wambat, 41 N.Y.2d at 494, Supreme
Court found it “conclusive” that regulation of the New York City taxi
industry had for decades been carried on by the local government.
(T2155-56.) That ruling was mistaken.
First, Supreme Court misread the case law. The welfare of
millions of New York residents and visitors does not cease to be a
proper concern of the State simply because the Legislature has not
acted recently within a particular field, and this Court has never so
held.
Supreme Court cited Osborn and Wambat as support for the
“important role of history” in home-rule analysis. (T2155-56.) But
neither case holds that a history of regulation at the local level can
preclude state intervention when a substantial state concern is found to
exist. In Osborn, this Court cited the city’s historical control over its fire
department in concluding that the “organization, operation and
56
administrative control” of fire departments are “matters of local
concern,” 272 N.Y. at 60, but that finding did not render the legislation
at issue invalid. Rather, the law was struck down because no connection
between its provisions and the State’s interest in the health and welfare
of the city’s population was supported by the legislative record. Id. at
59. And in Wambat, while the “constitutional and legislative history”
confirmed the existence of a substantial state interest, 41 N.Y.2d at
495, the Court did not state or imply that a history of regulation was
necessary to establish such an interest. Here, the legislative history,
including the express findings of the Legislature in § 1 of the Act, shows
that a substantial state interest is implicated. And that state interest is
confirmed by the fact that the Legislature has long regulated the
transportation system of New York City.
Second, while the local government is the historical source of the
restriction on the taxi supply in New York City, the Legislature has
long kept a watchful eye on New York City’s taxi system, anticipating
the prospect of exercising state authority over it. In 1936, a joint
committee of the Legislature expressly noted the broad public interest
in New York City’s taxi system and proposed state legislation to limit
57
the supply of taxis within the city. 1936 Legis. Doc. No. 83, supra, at 3-
4, 49-57. The committee’s report also noted that taxis were regulated at
the state level elsewhere. Id. at 26-27. The city, not the State, passed a
supply restriction first, but this does not mean that the Legislature
surrendered constitutional power to address the question.
Moreover, the city’s regulation of taxis has long been undertaken
pursuant to a grant of authority from the Legislature. The Legislature
has long delegated authority to regulate taxi service to the city through
its charter. When the city government passed its ordinance to limit the
supply of taxis in 1937, the Legislature soon after codified the ordinance
as part of an amended New York City Administrative Code. And in
1956, the Legislature passed General Municipal Law § 181, which
authorizes municipal governments across the State to regulate taxi
service and limit taxi supply. See supra 16. The State, in delegating
these powers to municipalities, has not surrendered its own regulatory
authority.
Indeed, this Court has expressly rejected the suggestion that the
State loses the power to regulate when it delegates authority to a local
government. Three decades after the State authorized New York City to
58
enact a commuter tax, the Legislature passed a statute to repeal the
tax. The Court upheld the later legislation over home-rule challenge,
rejecting the argument that the Legislature’s earlier statute
“surrendered to the City its power to legislate further in th[e] area.”
City of N.Y. v. State, 94 N.Y.2d 577, 591 (2000).
Supreme Court also overlooked the degree to which the
Legislature has acted in closely related areas. Not only has the
Legislature acted with respect to the transportation system serving
New York City, see supra 48-49, but it has also passed laws specifically
dealing with the operation of taxis and in particular, the New York City
taxi industry. For example, the Legislature has enacted laws imposing
a state surcharge on taxi rides originating in New York City to generate
funds for the Metropolitan Transit Authority. Tax Law § 1281.30 The
Legislature also requires drivers of for-hire vehicle drivers to file proof
30 In addition, on the few occasions since 1937 when the city has
issued small numbers of new medallions, it has done so pursuant to acts
of the Legislature passed at the city’s request. See supra note 13. This
does not mean that a home-rule message is required when the
Legislature concludes that issuance of additional medallions serves a
substantial state interest, as it did here. See City of N.Y., 94 N.Y.2d at
591.
59
of insurance with the state Department of Transportation. Vehicle and
Traffic Law § 370(1). Moreover, the State’s strong interest in ensuring
that transportation is available to disabled persons is clearly expressed
in several state laws. The State Human Rights Law declares that “the
state has the responsibility to act to assure that every individual within
this state is afforded an equal opportunity to enjoy a full and productive
life” free from discrimination on the basis of disability. Executive Law
§ 290. And a provision of the Transportation Law, enacted in 1984,
states that improving disabled persons’ access to transportation services
in New York City is “essential” to the State’s policy of offering persons
with disabilities the opportunity “to participate fully in the economic,
educational, recreational and cultural activities available to the rest of
its population.” Ch. 498, § 1, 1984 N.Y. Laws 2678, 2678. The 1984 law
required the city, among other things, to develop and implement a plan
for providing paratransit transportation within the city. Transportation
Law § 15-b(1)(d).31
31 Paratransit transportation consists of additional services, such
as door-to-door and shared-ride service, for individuals with disabilities
who are unable to use subways or buses for some or all of their trips.
(continued on the next page)
60
Third, any rule holding that past inaction by the Legislature
places a restriction on its present authority would have perverse effects.
Such a rule would encourage the State to intervene periodically in any
area in which it might wish to legislate in the future, simply to preserve
its authority to do so, instead of waiting to see whether local
governments can solve a problem adequately without state inter-
vention. And such a rule would prevent the Legislature from acting in
precisely those circumstances where state intervention is needed to
remedy persistent regulatory failures at the local level.
The latter problem is powerfully presented by systems of local
regulation that, like the taxi medallion system of New York City,
concentrate lucrative economic benefits in the hands of a limited class of
license holders who provide services to the public. Such regulatory
systems carry a strong structural risk of capture by special interests.
Indeed, a recent report by the Organisation for Economic Co-
operation and Development observed that the taxi industry in major
cities often “demonstrates powerful lobbying skills,” and found
See Metro. Transp. Auth., Guide to Access-A-Ride Service, http://www.
mta.info/nyct/paratran/guide.htm.
61
“regulatory capture” to be “widespread” in the taxi sector. OECD
Report, supra, at 18. As the report notes, the combination of a
secondary market for taxi licenses and a “restrictive approach to the
issue of new licenses” creates high license values, which in turn
generate “very substantial vested interests opposing any future reform
of taxi regulation” and a “high probability that any attempts to regulate
taxi supply are likely to be fatally undermined by regulatory capture.”
Id. at 30. In New York City, the medallion lobby has repeatedly blocked
the city from enacting meaningful reform, even though the number of
medallions is lower today than it was in 1937 and taxis have not been
functionally available to millions in the city for decades.32
A rule holding that the Legislature lacks authority to act if it has
not acted in an area recently would heighten the risk that powerful
32 See also OECD Report, supra, at 21 (“The experience of many
jurisdictions suggests that the relative supply of taxis in markets
subject to quantity regulation frequently declines over time and that
regulatory capture is a major concern.”); id. at 7-8 (identifying New
York City as a location where taxi medallion prices “have risen
substantially in recent years,” reflecting the “substantial and increasing
monopoly rents that can be accrued from the exploitation of
increasingly scarce taxi licences” and “continuing and increasing
transfers” of value “from consumers to taxi licence owners as a result of
the policy of supply restriction”).
62
special interests would capture local licensing authorities to the
detriment of the public. By the time it became apparent that such
capture had occurred, the special interests served by the existing
system would cite the Legislature’s historic inaction to prevent state
action to remedy the situation. The risk of capture is far less under this
Court’s precedents recognizing that the Legislature always retains the
power to act to further substantial state interests, regardless of whether
it has deferred to local regulation in the area in the past.
2. The court’s assertion that the statute
is merely the product of political
maneuvering is both irrelevant and
incorrect.
Supreme Court accepted plaintiffs’ contention that the Act
represented an “end run” by the Mayor after the City Council “refused
to do his bidding,” and concluded that the political controversies
surrounding the Act’s enactment cast doubt on its relationship to a
substantial state interest, and hence on its constitutionality. (T2157.)
This analysis is mistaken both on the law and on the facts.
As a legal matter, the lower court’s analysis on this point
overlooks the fundamental principle that the legislative process is the
63
proper forum for resolving political disputes. This Court has expressly
refused to consider claims of impure motives nearly indistinguishable
from those alleged by plaintiffs here, including charges that the
Legislature was engaged in “State electoral politics” and had employed
“hasty procedures . . . to pass [a] statute.” City of N.Y., 94 N.Y.2d at 591.
As the Court explained: “The vortex of the legislative process is often
the intersection of politics and policy. Speculation on the ‘political’
motivation of the Legislature . . . in an appropriate area of legislative
activity would be a slippery and dangerous slope.” Id.; see also People v.
Devlin, 33 N.Y. 269, 280 (1865); City of N.Y. v. Vill. of Lawrence, 250
N.Y. 429, 436 (1929). For these reasons, among others, the Court has
“consistently relied on the stated purpose and legislative history of the
act in question to find, or reject, a substantial State concern.” City of
N.Y., 94 N.Y.2d at 591; accord PBA I, 89 N.Y.2d at 391.
And as a factual matter, the story told by the plaintiffs, and
accepted by Supreme Court, strains plausibility. Neither the
Legislature nor the Governor of New York is a pawn of the Mayor or
known for doing the Mayor’s “bidding.” The facts here show that the
Legislature and Governor exercised independent judgment and gave
64
careful consideration to the HAIL Act before approving it. Neither the
Legislature nor the Governor adopted the plan as proposed by the
Mayor. The Legislature enacted its own plan, rejecting the compromise
proposal worked out between the Mayor and representatives of the taxi
industry, which would have tied the issuance of the new outer-borough
licenses to the new taxi medallions the TLC would auction. (T1345-49
(¶¶ 9-19).) The Governor demanded further substantial changes to the
legislation, including significant amendments specifically aimed at
improving access for persons with disabilities. (T1290 (¶ 20).) The
record simply does not support Supreme Court’s conclusion (T2157) that
the statute was not enacted to advance the substantial state interests
recited in the legislative findings.
3. There is no basis for Supreme Court’s holding
that the statute’s effects are disproportionate
to the State’s interests.
Supreme Court wrongly subjected the Act’s provisions to an
exacting form of means-ends scrutiny wholly of its own devising. The
court isolated the statute into small component parts and asked
whether each provision was independently justified by a substantial
state interest and represented the least-restrictive conceivable means of
65
serving that interest. (T2160-62; see also T2155.) Such expansive
second-guessing of legislative judgments is unknown in home-rule
jurisprudence and inconsistent with the Judiciary’s constitutional role.
The State Constitution grants the Legislature broad discretion to
identify appropriate subjects of legislation and to determine the
appropriate means to address them. Consequently, a court reviewing
the constitutionality of state legislation must refrain from substituting
its “own determination for that of the Legislature”—even where the
court would have made a different determination in the first instance.
Wolpoff v. Cuomo, 80 N.Y.2d 70, 79 (1992).
This Court has never required in a home-rule challenge that the
Legislature identify a substantial state interest supporting each of a
statute’s individual provisions. Nor would it make sense to do so, since
the substantiality of the state interest served by each small feature of a
statute is naturally less than the substantiality of the interest served by
the statute altogether. Nor has this Court required the Legislature to
demonstrate that its measures were the least-restrictive of local
regulation that could be devised. On the contrary, where the
Legislature acts in reasonable furtherance of a matter of substantial
66
state concern, it “may freely legislate, notwithstanding the fact that the
concern of the State may also touch upon local matters.” Kelley, 57
N.Y.2d at 538 (emphasis added). Consequently, “[o]nce a statute is
found to involve an appropriate level of State interest,” classifications
drawn by the statute need only be “reasonable and related to the State’s
purpose.” Id. at 540 (discussing classification in statute that treated
different municipalities differently).
Thus, the Court has repeatedly upheld against home-rule
challenge extensive state legislative enactments, addressing areas
previously subject to regulation by localities, without any consideration
of whether the Legislature could have adopted a less intrusive
approach. See, e.g., Wambat, 41 N.Y.2d at 494 (upholding
comprehensive state land-use plan that prevented all of the localities
within the Adirondack Park from “freely exercising their zoning and
planning powers”); Robertson, 268 N.Y. at 60 (upholding state
legislation that transferred control of Buffalo’s entire municipal sewer
system from the city to an independent public-benefit corporation).
Given the innumerable policy judgments involved in any such
legislation, a court empowered to second-guess legislative judgments
67
could always find reason to question whether individual provisions
sufficiently relate to an enactment’s overarching purposes or achieve
those ends in the least-intrusive manner. Supreme Court’s means-ends
test closely resembles the strict scrutiny applicable to statutes
implicating fundamental constitutional rights or suspect
classifications—a form of scrutiny that few statutes can survive. See
Miller v. Johnson, 515 U.S. 900, 920 (1995) (describing strict scrutiny as
the “most rigorous and exacting standard of constitutional review”).
This Court has never applied such demanding scrutiny under the Home
Rule Clause, as evidenced by the exceeding rarity of decisions by this
Court invalidating state legislation for failing to adequately advance a
substantial state interest. See supra 40.
Although Supreme Court acknowledged this Court’s consistent
pronouncements that the Home Rule Clause requires state legislation
to bear only a “reasonable relationship” to a discernable substantial
state interest (T2161; see supra 39, 43), it nonetheless found that this
standard implicitly authorizes courts to assess the “proportionality
between the means and the ends” of each of the individual provisions of
state statutes. (T2161.) Analyzing the HAIL Act in this way, the court
68
identified three features of the Act that, in its view, unconstitutionally
infringed on city authority: (1) “reallocating power” to issue new taxi
medallions from the City Council to the Mayor; (2) requiring the city to
fund wheelchair-accessibility grants of qualifying HAIL licensees; and
(3) creating a “bounty system” whereby agencies enforcing the Act can
fund themselves off-budget through collection of their own fines.
(T2161-62.) The Home Rule Clause does not authorize such demanding
scrutiny of the individual provisions of a statute. But even if it did, the
lower court’s evaluation of these three provisions of the Act would be
incorrect.
First, contrary to the court’s description (T2162), the Act does not
reallocate to the Mayor any power formerly held by the City Council.
The court correctly noted that the New York City Charter gives the City
Council the authority to direct the issuance of taxi medallions. (T2162.)
But that provision of the City Charter governs only the medallions
authorized by the Charter. It is not implicated when the State
Legislature authorizes the issuance of additional medallions, for a
specific state purpose, and provides a different mechanism for issuing
69
them. The City Charter binds only city officials, and cannot place
restrictions on the Legislature’s authority to act.
Nor is there anything improper or unusual about the Legislature’s
decision to vest executive authority in the mayor to decide exactly how
many of the 2,000 legislatively authorized medallions to issue. Cf.
Bugeja, 24 A.D.2d at 151 (rejecting home-rule challenge to legislation
that “empowers the Mayor of the City of New York to authorize the
issuance of serial bonds” in any principal amount below a specified
threshold). It is well established that an executive official or agency
may be charged with implementing state legislation. See, e.g., Boreali v.
Axelrod, 71 N.Y.2d 1, 10 (1987). Indeed, neither plaintiffs nor Supreme
Court voiced any objection to the numerous provisions of the Act
delegating most of the implementation authority to the TLC, an
executive-branch agency of city government.
The precise form of delegation at issue here—a grant of executive
authority to the “mayor alone”—is a frequent feature of state legislation
involving New York City. See, e.g., Public Authorities Law § 1266-c(2)(a)
(“mayor alone” may transfer city property to Metropolitan Transit
Authority); id. § 1729(1) (same, with respect to New York City School
70
Construction Authority); id. § 553-e(3) (same, with respect to
Triborough Bridge and Tunnel Authority); id. § 1728(10) (“mayor alone”
may indemnify New York City School Construction Authority against
tort and contract liability); Unconsolidated Law § 9609(d) (McKinney)
(“mayor alone” may take various steps to effectuate planned public
improvements near the United Nations). It is unsurprising that the
Legislature would employ this approach in the Act, rather than
authorizing the City Council to issue the new medallions, given the City
Council’s demonstrated reluctance to address the problems in the taxi
industry that the Act was designed to address. It would be a perverse
result if the Home Rule Clause required the Legislature to hand
implementation authority over state legislation back to the very local
government body whose refusal to act compelled state intervention in
the first place.
Second, the Act does not, as the court held, undermine the city’s
“economic self-determination” (T2162) by requiring the TLC to develop
a program for awarding grants to certain HAIL licensees to defray the
costs of buying wheelchair-accessible vehicles or retrofitting existing
vehicles, in order to satisfy the requirement that 20 percent of HAIL
71
licenses must be granted to wheelchair-accessible vehicles. (T2162.)
Contrary to the Court’s suggestion, the grant program does not amount
to “[b]reaking open the city’s piggy bank,” for the simple reason that it
does not call for the expenditure of funds that would be in the city’s
piggy bank without the HAIL law. The grant program will, at most,
require the city to devote a fraction of the new revenues provided by the
statute to grants to promote the wheelchair-accessibility of HAIL
vehicles. The Act caps the city’s obligation to award grants at $54
million. (T111 (Act § 9(a)-(b)).) At the same time, the Act authorizes the
city to auction each of up to 2,000 additional taxi medallions at market
price (currently between $700,000 and $1 million per medallion), and
authorizes the city to collect licensing fees from the issuance of HAIL
licenses.
It is not likely a coincidence that the cap level on the grant
program, $54 million, exactly equals the total amount in license fees
that the city would collect if the TLC determined to issue the full
authorized number of 18,000 HAIL licenses (T108-09 (Act § 5(a)-(b)).
The grant program can be understood as a mechanism that
redistributes license fees from the HAIL licensees without accessible
72
vehicles to licensees who have accessible vehicles. In any case, as even
Supreme Court acknowledged, the grants would advance “the laudable
goal” of increasing wheelchair accessibility (T2162), and that is more
than sufficient justification for directing the establishment of the grant
program as a modest offset to the overall financial benefits the city will
receive under the Act.
Third, the Act does not unreasonably intrude on the city’s finances
by requiring the penalties collected for violations of the Act to be
transferred to “the entity that issued the summons for the violation.”
(T116-17 (Act § 23).) Supreme Court accepted plaintiffs’ claim that this
provision would allow city law-enforcement agencies to “fund
themselves off-budget.” (T2162 (quotation marks omitted).) But this is
untrue. No provision of the Act limits the city’s ability to determine how
or by whom the funds that are received by its law-enforcement agencies
should be spent. In fact, the city’s charter requires that TLC and police-
department revenues not otherwise required to be paid into another
fund or account go into the city’s general fund, which is supervised by
the City Council. See N.Y. City Charter §§ 109, 225, 254.
73
The requirement that the tribunal transfer collected fines to law-
enforcement agencies does not limit the city’s control of funds received
by its own law-enforcement agencies. Instead, it apportions funds
among the various city, state, and interstate entities that have a role in
enforcing the Act’s new rules, so as to encourage vigorous enforcement
by all agencies of the statutory and regulatory restrictions that apply to
HAIL licensees. The requirement is found within the same section of
the Act that authorizes the state police and Port Authority police to
enforce those restrictions within their jurisdictions—which, in the case
of the Port Authority, includes the city’s major airports. By ensuring
that city, state, or multistate authorities receive the fines their
agencies’ enforcement efforts generate, the provision offsets the burden
of enforcing the new rules. And, of course, vigorous enforcement of the
Act’s restrictions on HAIL licensees, such as the rule prohibiting HAIL
licensees from accepting street hails in central Manhattan or picking up
passengers at the city’s airports, will benefit taxi medallion owners.
The errors in the court’s application of its “proportionality” test
confirm the wisdom of the Constitution’s vesting of policymaking
authority in the Legislature. Supreme Court dismissed the problem of
74
inadequate taxi service as a “molehill” that did not warrant a vigorous
state response. (T2161.) But it is more than a “molehill” when millions
of city residents and visitors—including entire low-income communities
and communities of color, millions of commuters and tourists, and
persons with disabilities—lack access to safe and reliable
transportation services that are readily available to other New York
City residents. As this Court has repeatedly held, the Legislature,
comprising the “elective representatives of the people,” Wolpoff, 80
N.Y.2d at 79, is better positioned than the courts to identify matters of
state concern and to determine how to address them. See, e.g., Sheehy v.
Big Flats Cmty. Day, Inc., 73 N.Y.2d 629, 634 (1989) (“[T]he Legislature
has both the right and the authority to select the methods to be used in
effectuating its goal.”); Montgomery v. Daniels, 38 N.Y.2d 41, 56 (1975)
(“[T]his court should not substitute its judgment for that of the
Legislature in determining the particular method to meet a given need.”
(quotation marks omitted)).
75
C. The HAIL Act Also Does Not
Violate the Double Enactment
Clause.
The Double Enactment Clause, N.Y. Const. art. IX, § 2(b)(1), like
the Home Rule Clause, imposes requirements on the Legislature before
it may pass a certain category of laws touching on the powers of local
governments. In particular, the clause directs the Legislature to enact a
Statute of Local Governments that enumerates additional powers
granted to counties, cities, towns, and villages beyond those set forth in
the Constitution itself, and requires the Legislature to pass twice, in
two successive years, a special law that “repeal[s], diminishe[s],
impair[s], or suspend[s]” a power granted to local governments under
that Statute of Local Governments. 33
The Double Enactment Clause has no application here for two
independent reasons. First, like the Home Rule Clause, the Double
Enactment Clause does not apply to laws that address matters of
substantial state concern. See Wambat, 41 N.Y.2d at 497. And
33 This Court has held that the Double Enactment Clause does not
apply to general state laws. See Floyd v. N.Y. State Urban Dev. Corp.,
33 N.Y. 1, 6 (1973).
76
therefore, like the Home Rule Clause, the Double Enactment Clause
does not apply to the HAIL Act.
And second, the HAIL Act does not repeal or impair any power of
New York City government that is set forth in the Statute of Local
Governments. Supreme Court found that the HAIL Act impairs the
city’s “power to adopt, amend and repeal ordinances, resolutions, and
rules and regulations,” a power conferred by the Statute of Local
Governments § 10(1). Supreme Court held that the HAIL Act constricts
the city’s power to adopt ordinances, resolutions, and rules because the
Act overrides certain New York City local laws—namely, the local laws
that grant medallion taxis the exclusive right to accept street hails city-
wide and permit the issuance of additional taxi medallions only via a
local law passed by the City Council. (T2163-64; see also T110, 117-20
(Act §§ 8, 25-29).)
Supreme Court is mistaken. The HAIL Act does not impair New
York City’s power to enact, alter, or repeal local laws.34 Supreme Court
34 In any event, the section of the Statute of Local Governments
cited by Supreme Court does not mention the power to adopt local laws,
as distinct from ordinances, resolutions, and rules and regulations. An
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77
conflated two separate concepts: a state statute that takes away or
limits a city’s power to enact local laws is very different from a state
statute that alters or overrides a particular local law, which is what has
occurred here.
This Court has made clear that home-rule concepts do not
constrain the Legislature’s authority to preempt particular local laws or
ordinances. To the contrary, “[t]he preemption doctrine represents a
fundamental limitation on home rule powers.” Albany Area Builders
Ass’n v. Town of Guilderland, 74 N.Y.2d 372, 377 (1989). A state law
that preempts a local law does not by virtue of that fact require double-
enactment on the theory that it impairs the local government’s power to
enact laws or ordinances.
Nor do the parts of the HAIL Act cited by Supreme Court repeal,
diminish, impair, or suspend any specific power granted under the
Statute of Local Governments. To the extent the HAIL Act implicates
the power to regulate taxis or set the number of taxi licenses, those
“ordinance, resolution, or other similar act” of a local legislative body is
distinct from a “local law.” Muncipal Home Rule Law § 2(9). The power
to adopt local laws is set forth in the Constitution itself, not the Statute
of Local Governments.
78
powers are granted to localities not by the Statute of Local
Governments but by a different statute, General Municipal Law § 181,
and therefore a statute implicating those powers is not subject to the
Double Enactment Clause.35 Moreover, nothing in the HAIL Act impairs
the city government’s ability to issue additional medallions or HAIL
licenses or purports to dictate the procedures the city must follow if it
chooses to do so. The Act merely affirmatively authorizes the issuance
of additional licenses via state legislation to be implemented by the
Mayor and the TLC.
In sum, the HAIL Act is not subject to the Double Enactment
Clause because it does not impair any power granted by the Statute of
35 Wambat provides a useful contrast to this case. There, the State
enacted a comprehensive land-use plan for Adirondack Park region,
which thereby prevented localities partly or wholly within that region
from enacting zoning ordinances covering the area. Zoning authority, in
contrast to taxi regulation, is a power specifically set forth in the
Statute of Local Governments. See 41 N.Y.2d at 492-93; see also Statute
of Local Governments § 10(6)-(7). For this reason, the state statute at
issue in Wambat did potentially implicate the Double Enactment
Clause, although the Court held that the statute was not subject to the
double-enactment requirement because it rationally served a
substantial state interest. See 41 N.Y.2d at 497-98.
79
Local Governments, and also because it serves a substantial state interest
and is for that reason exempt from the requirements of the clause.
POINT II
THE HAIL ACT DOES NOT GIVE PRESENT
HOLDERS OF LIVERY LICENSES A
MONOPOLY PROHIBITED BY THE
EXCLUSIVE PRIVILEGES CLAUSE
Supreme Court also incorrectly invalidated the HAIL Act under
the Constitution’s Exclusive Privileges Clause, N.Y. Const. art. III,
§ 17.36 The Exclusive Privileges Clause is a narrow restriction on the
governmental grant of a monopoly to a private concern. Supreme Court
turned the clause on its head by permitting plaintiffs to use this anti-
monopoly clause as a weapon to suppress economic competition and
preserve the exclusivity of their own privilege—infrequently exercised—
to accept street hails in the outer boroughs of New York City.
36 Plaintiffs rely on the eleventh clause of article III, § 17; the
relevant text provides that “[t]he legislature shall not pass a private or
local bill . . . [g]ranting to any private corporation, association or
individual any exclusive privilege, immunity or franchise whatever.”
80
Supreme Court held that the Act violated the Exclusive-Privileges
Clause by establishing eligibility requirements for HAIL licenses and
permitting eligible persons to obtain a license by paying a designated
fee that Supreme Court speculated to be less than the market value of
the license. The court also said that the Act violated the Exclusive
Privileges Clause by making HAIL licensees eligible for government
grants to defray costs of purchasing wheelchair-accessible vehicles or
retrofitting existing vehicles to make them wheelchair-accessible.
(T2164-65.)
This ruling fundamentally misunderstands the scope and nature
of the Exclusive Privileges Clause. In a series of cases dating back more
than 125 years, this Court has consistently recognized that the
Exclusive Privileges Clause is a narrow prohibition that restricts the
creation of monopolies by governmental act. See, e.g., Consumers Union
of U.S., Inc. v. State, 5 N.Y.3d 327, 360-61 & n.27 (2005); Matter of
Union Ferry Co. of Brooklyn, 98 N.Y. 139, 150 (1885).
To violate the clause, therefore, a law must both (1) benefit a
single entity and (2) prohibit others from enjoying the same benefit.
Consumers Union, 5 N.Y.3d at 360-61. A law addressed to a broad class
81
of beneficiaries does not violate the clause. Nor does a law naming a
specific beneficiary violate the clause if it merely grants the beneficiary
certain “privileges and franchises” that it does not affirmatively grant to
others, so long as the statute does not purport to guarantee the
beneficiary that the same franchise will not be granted to anyone else.
Union Ferry Co., 98 N.Y. at 150. Thus, for example, a law that simply
authorized a particular concern to operate a ferry or construct and run
a toll-bridge would not grant an “exclusive” privilege within the
meaning of the Constitution, but the law might violate the clause if it
also prohibited other ferries or toll-bridges from operating within a
specified distance. See id. at 151-52 (collecting examples); see also, e.g.,
Trustees of Exempt Firemen’s Benevolent Fund of City of N.Y. v. Roome,
93 N.Y. 313, 328 (1883) (law assigning proceeds of insurance tax to
specific charity permissible because Legislature could grant same
benefit to other entities); Consumers Union, 5 N.Y.3d at 360-61 (law
allowing not-for-profit corporation to convert to for-profit status
permissible because same right could be granted to others).
The HAIL Act meets neither of the narrow criteria necessary to
raise an exclusive-privileges problem. First, the provisions concerning
82
eligibility for HAIL licenses and the provisions describing a program for
monetary grants to promote accessibility of HAIL vehicles do not name
a specific entity as beneficiary. Rather, those provisions create
qualifications that define a broad class. The statute provides that livery
licensees in good standing who have held their licenses for at least one
year are eligible for HAIL licenses and holders of livery base permits
who have been in operation for at least three years are eligible for HAIL
base permits. These classes encompass some 60,000 members. (T139
(¶ 29).)
Supreme Court cited two cases for the proposition that the
Exclusive Privileges Clause applies to law benefitting “groups” (T2165
(emphasis omitted)), but the court misread those cases. In Fox v.
Mohawk & Hudson River Humane Society, this Court invalidated a law
conferring an exclusive exemption from payment of dog-license fees on a
single private organization in each county of the State—thereby
granting each named beneficiary precisely the kind of geographic
monopoly that the clause prohibits. See 165 N.Y. 517, 526-27 (1901).
In 19th Street Associates v. State, the Third Department found
that a statute granting special rights against eviction to identifiable
83
residents of a specific apartment building violated the Exclusive
Privileges Clause. See 172 A.D.2d 380, 381 (3d Dep’t 1991), aff’d on
other grounds, 79 N.Y.2d 434 (1992). The law at issue there did not
identify a broad class of beneficiaries by general criteria, as the HAIL
Act does here. And though the decision in 19th Street Associates was
appealed to this Court, the Third Department’s exclusive-privileges
holding was not addressed in that appeal. To the extent the Third
Department’s decision may be read to suggest that legislation may
violate the Exclusive Privileges Clause merely because it benefits a
specific group, it does not correctly state the law, as demonstrated by
this Court’s more recent decision in Consumers Union, which reaffirmed
the basic principle that a law granting a franchise or license to one
person does not violate the Exclusive Privileges Clause unless the law
also prevents the Legislature from granting the same franchise or
license to another person in the future, see 5 N.Y.3d at 360-61.
The exclusive-privileges claim is defeated not just by the
numerosity of the class defined by the HAIL-license eligibility
requirements but also by the open-ended nature of the class. The Act
imposes no restrictions on anyone’s ability to achieve the necessary
84
qualifications for eligibility. Anyone may meet the qualifications for
eligibility to obtain a HAIL license by obtaining a livery license or base
permit and waiting the requisite period, and anyone who obtains a
HAIL license is eligible to receive an accessibility grant. The fact that
the defined class is open to entry is an additional and independent
reason that there is no exclusive-privileges violation. See, e.g., Matter of
N.Y. Elevated R.R. Co., 70 N.Y. 327, 338, 350-51 (1877) (act applicable
to all railroads meeting certain specifications was constitutional even
though only one such one railroad then existed); Hotel Dorset, 46 N.Y.2d
at 368 (law was not “applicable only to a single enterprise” even though
Museum of Modern Art was lone institution that met statutory
specifications at time of enactment).
Second, the Act does not violate the Exclusive Privileges Clause
because it does not grant the class in question any privilege or franchise
to the exclusion of all other persons. To the contrary, the privilege a
person gains by obtaining a HAIL license—the ability to pick up street
hails in the outer boroughs and northern Manhattan—is one already
enjoyed by taxi medallion owners themselves. Cf. Consumers Union, 5
N.Y.3d at 361 (no exclusive-privileges violation where law granted
85
company the “right to operate as a for-profit insurer, a right that
numerous other insurers currently enjoy in New York, and which others
may receive upon application to the Superintendent”). The taxi
medallion owners’ attempt to use the Exclusive Privileges Clause to
prevent others from sharing a privilege they already hold is rich with
irony.
Contrary to Supreme Court’s ruling, the fact that the fee set for
obtaining a HAIL license may be less than the market value of the
license has no relevance under the Exclusive Privileges Clause. Nor is it
relevant that it is possible HAIL licensees may be able to earn a
premium by transferring the license at a higher price than the fee paid
to obtain it. (T2165.)37 The Exclusive Privileges Clause does not require
37 Supreme Court’s hypothesis that HAIL licensees would be able
to earn a substantial profit by selling their licenses is entirely
speculative. The court wrongly used the going rate for selling taxi
medallions—$700,000 to $1 million—as a benchmark for the value of a
HAIL license (T2164). The economics of the market for taxi medallions
are completely different from the economics of a market for HAIL
licenses. First, holders of taxi medallions enjoy the lucrative right to
accept street hails in central Manhattan and to pick up passengers at
the airports, whereas HAIL licensees will not. The fact that taxi
operators choose to ignore the outer boroughs almost entirely says more
about the likely market value of a HAIL license than does the going
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86
that every government license must be issued in exchange for a
payment equaling the market value of the license. Nor does the clause
require that the same license fee be charged to every applicant for a
particular kind of license. Questions about disparities in such fees are
policed by the Equal Protection Clause, not the Exclusive Privileges
Clause, which is an antimonopoly provision.
Plaintiffs have not raised any equal-protection claim here, and
such a claim would not succeed if it had been raised. The fact that the
statute sets a relatively modest fee for the HAIL license, as compared
with the going price for taxi medallions, is reasonable. The HAIL license
is a new class of license whose economic value has not yet been proved.
Moreover, setting a high fee may not well serve the State’s interest in
encouraging eligible persons to apply for and obtain this new license, so
as to bring the illegal street-hail market under regulation and thereby
increase residents and visitors’ access to safe, reliable, and wheelchair-
rate for selling a taxi medallion. Second, the market value of a taxi
medallion derives from medallion holders’ ability to earn monopoly
rents due to the artificially low supply of medallions. See OECD Report,
supra, at 7-8. There is no reason to believe the same conditions will be
present as to HAIL licenses.
87
accessible transportation in the outer boroughs. See, e.g., People v.
Knox, 12 N.Y.3d 60, 69 (2009) (observing that “[t]he rational basis test
is not a demanding one,” but rather “a paradigm of judicial restraint,”
requiring a challenger to show that “a statute is so unrelated to the
achievement of any combination of legitimate purposes as to be
irrational” (quotation marks omitted)).
Nor does the Act violate the Exclusive Privileges Clause by
making financial grants available to certain HAIL licensees to defray
the costs of buying wheelchair-accessible vehicles or retrofitting existing
vehicles. (See T2164-65.) Taxi medallion owners may contend that such
grants should be made available to them as well, but the scope of the
grant program does not raise any exclusive-privileges problem. The
clause is not a restriction on the government’s ability to provide
financial grants or subsidies to classes of persons—it is an
antimonopoly provision.38
38 Further, this Court has recognized that even some monopolies
may be authorized in furtherance of the police power to protect public
health. See City of Rochester v. Gutberlett, 211 N.Y. 309, 320 (1914).
88
In any event, the Act’s provisions regarding grants, like its
provisions setting the fees for HAIL licenses, are rational. Many
applicants for HAIL licenses are likely to be small business owners or
self-employed persons. (See, e.g., T1447 (¶ 3); June 21 Tr., supra, at 21
(statement of Assemblyman Karim Camara).) The Act requires that 20
percent of HAIL-licensed vehicles be wheelchair-accessible, and it is
reasonable to develop a program to subsidize the costs of achieving that
requirement, particularly since the profitability of operating under a
HAIL license is not now known. The government has broad discretion in
determining which activities should be subsidized, and no constitutional
problem is raised merely because a grant program could conceivably be
broader than it is.
Finally, even if the provisions regarding the HAIL license fees or
the accessibility-grants program conferred the kind of privilege that is
relevant under the Exclusive Privileges Clause, and they do not confer
any such privilege, there would be no exclusive-privileges violation
because nothing in the Act purports to guarantee that the Legislature
will not give similar benefits to others. Only laws that extend such
89
promises of exclusivity may potentially violate the Exclusive Privileges
Clause. See, e.g., Consumers Union, 5 N.Y.3d at 360-61.
CONCLUSION
Supreme Court’s judgment should be reversed.
Dated: New York, NY
January 18, 2013
BARBARA D. UNDERWOOD
Solicitor General
RICHARD DEARING
Deputy Solicitor General
ANDREW W. AMEND
CLAUDE S. PLATTON
Assistant Solicitors General
of Counsel
Respectfully submitted,
ERIC T. SCHNEIDERMAN
Attorney General of the
State of New York
Attorney for State Appellants
By: ____________________________
ANDREW W. AMEND
Assistant Solicitor General
120 Broadway
New York, NY 10271
(212) 416-6511
Reproduced on Recycled Paper
ADDENDUM
TABLE OF CONTENTS
Page
Decision of Supreme Court, dated Aug. 17, 2012............................................... 1
(incl. pagination from Record in Taxicab Service Association)
HAIL Act, Ch. 9, 2012 N.Y. Laws ..................................................................... 33
Ch. 602, 2011 N.Y. Laws .................................................................................. 49
Legislature’s roll call vote for Ch. 602, 2011 N.Y. Laws.................................. 52
1936 Legis Doc. No. 83 (excerpts: pgs 3-5, 20-21, 48-57)................................. 54
Edward G. Rogoff, Regulation of the New York City Taxicab Industry,
City Almanac 1 (Aug. 1980) ............................................................................ 64
Ari L. Goldman, Taxi Panel, After Yearlong Study, Offers 73 Ways to
Improve Service, N.Y. Times, Mar. 30, 1982, at A1....................................... 83
N.Y. City Local Law 12 (1971) .......................................................................... 85
Examples of statutes affecting New York City ................................................ 93
ADD1
2138
SUl1IWME COURT or THE STA'J E OF NEW YORK
COUNTY OF NEW YORK: PART S2
---.-. -- ---- ----.- -_. --- --_._-_••_----- --•• -----.- --.------. --- ._--:<
TAXICAB SERVICE ASSOCIATfON, ~uL
Index Number: 10]553-2012
. Plaintifrs,
" ag:lil\sr -
'IHE STA /'E OF NEW YORK. I:t a1..
Defendants,
-.-..._....-..----...------··--·--------------·------·----·--------·-x
METROPOLITAN TAXICAB BOARD OF TRADE,
el aL
Index Number: 102472-2012
Plaintitls.
Decision and Order
- against·
MICHAEL R. BLOOMBERG, AS MAYOR OF THE
CITY O~ NEW YORK, et aI.,
Defendants.
..---....---------..-.-------.-.---------.------------------···-·--x
GI~EATER NEW YORK TAXI ASSOCIATION. el anD..
PlaintilTs•
. against·
THE STATE or NEW YORK, £Ul...
Defendants.
--------.-..--.--- A. ._-0--._-----.-- a_eo_oX.
Arthur F. Enguron, Justice
MOtiOllS for preliminary and dispositive relief in all three of the above-titled cases eISA," "MTBOT,"
and "GNYTA," re..c;pectively) arc hereby consolidah:d for dcc.ision and decided as indicated below.
Page 1of 32
ADD2
2139
III cumplioJlc\.' wiLh CPLR 2219('1). this Court slat~~:-lhaILhl' lilllllWitl~~. p"11I.:r:;. 11l1111h,'r\'lI I Ihrl1l1ilh t.;~
A Ihl\lUgh HH; lind lLtl IV. were used in d~d(lillr. Ihcsl: I\llltions Jilr prdin}imlry amI disru~ili\'o: rl:lid
(the fClugh prolocols arc: documents or rccOI'd hcl~ll'\~ ductlm~l1Ls nul or rcwrd: lhl'n dU·lln'llllgi,·all.,:
then '['SA before MI.f.!QI before GNYT1\; tllen pleadings bclim:: nlllL:r Jlupcrs; IhclI nnLiC~li ht'li"'l'
Llffinnationslatlidavitl:; then plaintiff..; before City before State before Intervenors: then a[phabcticHlly):
I
I.,
,
J.
4.
S.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
to.
17.
1S.
19.
10.
21.
22.
23.
24.
25.
26.
27.
21t
19.
30.
31.
32.
4/1 SIl2 - MTBOr - Complaint (llllbm. w/Brcnmm 5i7/12 Aflirm.)
41'27/12 - TSA - Complaint
517/12· MTBOT· City Defendants' Answer(subm. w/Brennan 517/12 Affirm.)
517/[2· MIBOI ~ City Defend.mts· Notice of Motion for Sum. Jdmt.
517/12· Mn~(lT - Brcnlli.lI1 Animl. ill SUPflorl of Sum. Jdml.
5i7/1J. - M]110T· Yalisky Aflitl. in SUPI'IOrl ()f Sum. Jdlllt. (subm. wlBrennan 517/12 Atlirm.)
S/IlldJ . T!O;A .Cily J)clcndmll~'Answer (liubm. w/Brcnmm 5/16 Atlinn.)
5/Ih!I:!· TSt\· <:ily Dclcndulllll' Notil'c nfMotiol1 for Sum. Jdmt.
5!161J 2 - ]]6 " Brennan l\rlirm. ill 8\11'p011 or Sum. Jdmt.
;,' I(II' ~ - TS,\ • Johns :\Oil!. ill SlIPp(lJ1 of Sum. Jdml.
511<1112 - TS6· (jcrmn:1 Anit!. in SUI'lllorl nrPrelim.lnjunct.
5/16112 - lSi\ . 1<11)' A\lid. in Support ofl'l'elim. Injunct.
:'!16i [~ - TIill- Kumaltulr Amd. in Support of Prelim. Injunct.
5/1 Ii/l 2 • TS.~ . M.Olslnl l\Jlirm. ill SUPPUl1 nrt1relim. Injunct.
5/1 Mil· TS~ . Milll:r Anid. ill SUflpurl "f Pn:lim. Injunct.
5/16!1:!· MlliQI - Ali Anil!. in SUpp\ln ()rPreJiI1l.lJ~il\nct. (subm. w/OSC papers)
5/1 ('1112 . MTUOT • Shcnmm A/lid. in SUPPllrl of Prelim. Injunct. (sub",. w/OSC pllpers)
Sil7/1:! . MInOT. Fililer Anid. in SuPI't1f\ ufPl·elim. IrtjUJlI:L (suom. w/OSC papers)
.5117/12 . MTIlOT - M..zCI· Amnn. ill Support ,"f Prelim. InjuncL (subm. w/OSC papers)
5/17/1:! - MInOT· Runner AI11d. in SUflPUM of Prelim. Injunct. (subl1l. w/OSe papers)
511 RII::! - MTHOT - Amended Cumplainl
:ill XII 2 - Mm01' . Ilrinckcrhntl· Arlinn. ill Support of Prelim. Injunct. (subm. wlOSC pap<:rs)
5/21/12 - I£A - Order to Show Cause Seeking Prelim. Injwlct.
5/21/12 - MTBOT • Order to Show Cause Seeking Prelim. Injunct.
5/24/12· GNYTA - Complaint (subm. w/OSC p'c1pe1'S)
5/25/12 - GNITA - Order to Show Cause for Prelim. Injunct.
5/25112 - GNYTA - Mintz AI'til111. ill SUllpurl nfflrdim. Injlllll:l. t=-uhm. w/OSe P;IIX'fll}
5/29/12 - TSA - Chhabra Atlid. in Opp. Lv Prelim. InjullCI. (slIhm. w!Br"'11Iinll :'i/:>O/l:! Anil'l\1.)
5129112 - TSA - Churi Affid. in Opp. to PI'elim. Injuncl. (suhm. wlllrcnnan 5!311/1 ~ Aninn,l
5/29/12 • TSA - Miller Affid. in Opp. to Prclim.l~iuncl. (suhm. w/llrellnan 5/30/1 ~ Mlirm.)
5/29/12 - M11l0T - Chhabra Affid. in Opp. to Prelim. Inj. (subm. wlBrcnnan 51311/12 Al'Iirm.)
5/30/12 - TSA . State Defendants' Notice ofCw:>s-Molion to Dismiss
Page 2 of 32
ADD3
., ...
.l.' .
34.
35.
"1, ..
'I)
.' .
40.
41.
42.
43.
44.
·IS.
46.
47.
4lL
49.
50.
51.
"}
) ...
."',.;.
51.
)11
57.
58.
59.
(i0.
01.
62.
61.
2140
5130/12 - ~rSA - Oerrur(i Reply r\ Ilinn. in Supporl or Prel im. Injul\cl.
5/1011 ~ -IM . Komanoff Reply Aflirm. ill Support (,If (Jrelim. Injunct.
5/10/12 - TSA - ['"Jumbo Reply Affid. in Support or Pl'elim./njuncl.
:i(lwI2· TSA - Url'nnan ,'fIinn. ill t)1'1l. 10 Prelim. In.iune!.
,,;11\'1 ~ . M.Till~ I - BI"\'I1"'1I1 ,\ ninll. in ()PIl- to Prelim, Injullct.
:;/.HI,' I ~ • ~!l.~'yTi\ • BI'~'Il11;lIl .'\ nirlll. in C)[1}l. 10 Prelim. Injunc\.
5/ -; ilil2 . G\~:.l>~ - tilll dh'-'l 1: !\!linn. in UPIl. 10 Pre! illl. h~iul1c,.
5/31/12 -1illi. - Miller Reply Atlinll. in Support ()fPrclim. ll,iullcl.
6/1 1/1'2 - TS(\ - Goldstein Alfirm. in Opp. 10 Defendants' [)i~posilivc Molil)IlS. eh.:. (ulldmcd)
6ill1l2 - TS..b.. - Shl\piro Amr",. in 01'1'.10 Dclendant~: Dispositive Motions. ele.
6/1111 ~ • MTBQl- City Ddendtmts' Answer tu Amended Complaint
6111j\ 2· MTROT ~ Pluintiffs' Notit:e of Cro$S-Mulion 1'01' PnrtiHI Sum. .Jdml.
6/11/12 - MTIlQ], - I3rinckcrhoff Atlirm in Opp. to S\II1\. Jdmt, eiC.
6113/12 -I~ . Plaintiffs' l'lItice of Cross-MOl ion I'M SUIll. .lelm\., dc.
6115/12 - ISLi - Yassky Reply Anid. in SUPPllrt ofSuJII. Jdllll., ctc.
6/151\2 - TSA - AILalllin\l1o Aflid. in Opp. to Prelim; Injuncl.. ClC.
6/1 5112 - TSA • Garcia Amc!. in Opp; to Prelim. Injunct.. etc.
6/15/12· TSA . GCllcre Affid. in Opp. to Prelim. Injunc!., etc,
61\5/12 - TSA . Santiago Aflid.in 0PI). lO Prelim. Injunct.. elc,
6/15112 • MTBOT - Altl\minlOo AClid. in Orp. to Prelim. Injunel., etc.
(.;, :,i I.~ - .I\-ITBO1 • (ian:i:1 1\ tlhl. in 0llp. to Prelim. Injunct.. elc,
6115,'1.!· MTIun - (Jell..:r,: Am", in 0\111; lO Prelim. injullct.. cte.
61 I,,; I!. - !'v11'llrelim, Injunct., elC.
6/22/12 . MTIJOT - Bulin Atlil'm. in Support or Prelim. JJ~jUl1c[', etc.
6/21/12 • MT130T - Alt:nniruno Reply Allid, in Opp. 10 PI'clim. Injunct., etc.
6129112 - GNyrA . City l)cJcndanls' Answer (c-l\1llilcd 7;20/12)
717112 - ONYTA· Stillulation und Order
The lolklwing pnp~rs were also read ill supporl of or opposition to the mutions:
D!)('l.IMENTS NOT OF REO)RO
/\. 517112 - MTBOT • Cit)' 1)etcndonls' Memo in Support of Slim. Jdlllt.
n. 5/I(j112 - TSA - City l)ct'el\dants' Memo in Supporl or Sum. Jdmt.
C. 5/17/12 -ISA' Plaintiffs' Memu in Support of Prelim. Injunct.
D. SfP;1\2 . MTBOT· PI' Memo in Support ot'Prclim. Injullc-l.
I:.. Si2-"i ~ 2 . MXIH.!I - De Hlnsin Amicus Memo in Supporl or Pre! illl. Injunct.
Page 3 of 32
ADD4
2141
I: 5130112· MTBOT -I· TSA - City Delcnchmts' Ml'!l10 in 0Pi>. In Prelim. Injunct.
(i. 5130112· T~A • Stor~ Defendants' Menlo in Opp, to Prelim. Injunct., ct\:.
II. 5130/12 • MIBOI - Slnle Defendants' Memo in Opp. to Prelirn. Injunct., etc.
I. 5/31/12 - TSA • Plaintiffs' Reply Memo in Support of Prelim. Tnjlll1cl.
.J. 5/31/12· MTBOI· Plaintiffs' Reply Memo in SUppol1 of Prelim. Injunct
K. 6/4/12 .~. Mastro teller (re: City/Stale)
L. 6/5/T2 - ALL - l3illder Letter (re: City/State)
M. 6/6112 •~. Platlon Letlcr.(l'e: City/State)
N. 6/R/12 - I.SA. Mastro l.eller (re: Cily/Stale)
O. 6/9/1"2· MTBOI - BrinckcrhoffLettcr(re: City/State)
P. 6/11/12· ISA· Ph'intiffs' Memo in Opp. to Defendants' Dispositive MOlions. etc.
Q. 6/15/12 - TSA • City Defcndnnts' Reply Memo in Support of Smll. Jdml.. etc.
R. 6/15/12· TSA • State Defcndants' Reply Memo in SUPP0l1 of Dismiss£ll (w/cOJ'TCCLcd 1'.11 )
S. 6/15112 - TSA • Intervenor Defendant" Mcmo in Opp. to Prelim. Tnjunc.liol1, etc.
T. 6/1 5/t2 - MTBOT. State Defendants' Reply MClno in SlIpport of Sum. .Idl'lll.
U. 6/15/12· MTnOT . Intervenor Defendants' Memo in Opp. to Prelim lnjullct., cle.
V. 6/16/12· TSA • Cily Defendants' Memo in Support of Sum. Jdml.
W. Ci/18/12· MTBQT· Borough Pres. Stringer's Amicus Memo.in Support of Sum. .1dml.
X. 6/20112 - GNYTA ... TSA • Letter of Steven G. Mintz re: CPLR 3211 (c)
Y. 6/2 I/ 12 • GNyrA + TSA • Letter of Binder re: ''Takings'' and Discovery
Z. 6rJ. 1/\2· GNYTA + TSA - Ll:ltcr of Planon re: CPLR 3211(c)
AA. 6/22/12· TSA • Plaintiffs' Reply M~tn() in Support of SLlIll. Jdmt.
13B.6122/l2 - ]]A. Mastro Letter re: "Takings"
ce. 6122/12 - MIBOl· Plaintiffs' Reply Memo in Support ofPal1ial Sum. Jdml., ctc.
DD. 6/27/12 - MTBOT· City Defcndants' Memo and Reply Memo
EE. Gng/12· CiNYTA -I- TSA - Mintz Letter rc: CPLR 3211(c)
FF. 6n9l12 • IS.3 . Mush'O Letter re: Noel (inclUding Fu"'<.hs. A-C, as sllrplcmcnlc~l)
OG. 7/2/12· TSA - Bindel' Letter re: Noel
HH. 71/./\2 - TSA· PlattonLctter re: Noel
The 1()llowing papers are noted in passing:
I. 5/31/12-AW.:- l'ranscript of Oral Afgument
II. 6/1/12 . ~!l. . Temporary Reslraining Order
111. 717112 . GNYTA - Stipulation anll Order (Mintz, Drenn:m, ()}atlon, Saxt. Engoron)
IV. 7/13112· GNYTA - Ministet;al Decision of71l3/1i
Upon the foregoing papers, plaintilTs arc granted summary judgment on their "!lome rule:' "dollbk
enactlllent," llnd "exclusive ~)rivileges claims"; and defendalltS are gr.mtcd summary judgment nil
plaintiffs' "improper delegation:' «takings:" and "environmental review" c.Jaims.
P"ge 4 of 32
ADD5
2142
The Protocols
In these three cases, ulll'lainliffs are united in interest against the subjcC.1 kgislatilm, and all dl'lcndmlls
arc united in inlcresL In support of the subjcct legishllioll. FU11hermore. with only a vcry lew
exceptions, which arc \)f theoretical interest but practical irrelevance, each side' s arguments are
cOllsislent and coherent. Thus, the Coun will refer to each side colleclively. wilhout ditlercntil1tin~
between the panies. Generally. citations for qUOlations and references will only Ix: given ror ;mpcrs Ill'
ret·nrd. .
The Players
PlaintitTTaxicab Servk-e Association ("TSA") consists ot"not-for-protit, member-owned cr.cdilunion
lenders thal finance Ncw York City taxicab license ("medallion," named for the metal hood onlllIIICllI
affixed to legal laxieabs) purchases. The other TIit\ plaintiffs arc TSA members. Plaintifr
Metmpolitfln Taxicab Boned ofTradc ("MTBOT") is a trade association ufNcw York City t;'lxicab
mcdallion owners. PlaintifrNew York City Council Member Lewis/\. Fidlcr represents Ihe 4GI~
Councilmanic District, in Brooklyn. The other MIBOT plaintitls are medaJlioncd tnxicab owners
and/or drivers: PlaintitT Greater New York Taxi Association is an associatiOll of IllCdllllilllled Inxicuh
owners. The other GNyTA plaintiff is a member. Detcndant 11,e New York City Tmc i and r.imousinc
Commission ("TLC"). an executive-branch agency. WllS cTCllted by New Yurk City Council LnClIll.t1w
12 of) 971, passed pursuant 10 New York City Charter Chapter 65. § 2300, and has broad PllWCT:\ III
regulmcall for-hire motor vehicles in New York City. Defendant David Yassky is Commissioner 01"
lhe TLC (and, ironically, a form~r mcmber afthe City Council). Dcfendants The Stat.e orNe\\' York.
The New York State Assembly, The New York State Senate, New York State (Jove11lor Andrew M.
Cuomo, 11,e City ofNew York. and New York City Mayor Michael R. Hloomherg presumt1bly necd no
illLmduction.
Fact"llal Backgro\!Dd
New York City regulation oP'taxicabs" may pre-date the invenli011 of the internal combustion cngine;
its origins an: shrouded ill the mists of time. Looking back in 1937, a court noled that "The ll~ of the
publIC streets for hire has ... always beel1ueated as a privilege granted by the ciLy." Rudack v
~1I1~l1line. IllJ t-,·1il'lc 316. 326 (Sup Ct. NY ('ounly 1937); sec also Yellow Taxicab Co. v Gaynor, &2
Mis\.' 1)-1. 10K (SUI' C't. NY Count)· 1'113) t;'Thcnght of a municipality to establish public hack slllnds
IlilS Ol'cn l"Ccl1gnizedmltl aC·ll:d upun hy the city ofNcw York, from early times, and is but an incident
or lhco rightt() Ikcn:-iC tlllu n:!,;ullilC thusc "'htl ply the trade ofhackmen for hire:').
'n,c Schaller Con~ulting Company (WWW.SCHALLERCONSlJLT.COM) has painted lTSA Cplt
Ex.h. D) u fascimlting portrait of the fonnative years ofNew York City's fabled ltlxicab induslry:
During the 1920s ond 19305, easy cntry into this all-cash business led to an overllupply
of taxis. resulting in trallic congestion, fare-cutting wars, low driver wages,
inadequarely insured vehicles. and other unsafe and sometimes ilkgal activities. nle
Page 5 or 32
ADD6
2143
Cire:1l Depression created nn influx nruncmployed workers which worsened these
problems. with the number of cabs spiraling to 21,000 in 1931.
To address problems of oversupply, in 1937 the City BOlUd of Aldermen enacted [and
Mayor Fiorello La Guardia signed] an ordinance [Chapter 27-a oflhe Codc of
Ordinancc] sponsored by Alderman Lew HaDs (thus, "the Ilaas Act") to freeze the
Ilumber of taxi Imt.-dallions) at 13,595, the number then oUlslanding. New York thus
joined ... other [major] cities in placing a cap on the number of taxicabs I.!.&:, mOlor .
vehicles allowed to pick up street hails (infra) anywhere in New York City"j. Most uf
these cities did nol issue new taxi licens~ for 50 yet\rs or morc.
In 1938, the New York City Council assumed control over the medallioned taxic:lll industry. Over
time, attrition decreased the number of outstanding medallions to 11,787. In 1996, pursllnnllo Slate
legislation in response to a "home rule message" (see below) by the New YOl'l< City Council. thc Cily
auction~ an ,ldditiona1400 medallions. In 2004, pursuant 10 another City Council "[lome rule
message:' the City auctioned an additional 900 medallions. In 2006, pUl'suant to !l, third City Council
"home 1'.Ile message," ,the City auctioned an additional 150 medallions.
Currently, approximately 43.000 licensed taxicab drivers, in l3,237 (11 ,7R7 + 400 + 900 +- 150)
mcdnJliollcd vehicles (onen called "yellow taxicabs." for their mandatory paint job), mor~ than 5,000
of which are individulllly owned and operated, and 231 of which arc wheelchair-accessible, prnvide
240 million rides to 8 million residenls and 40 million visitors, generating $2.5 billion annually. At lhe
sume time, the non-medallioned "liver)'" industry has some 38.000 licensed drivel'S in 23,000 v~hieks
tllm nre affiliated with 450 bases,
The Legislative Background
Our story proper begins in or about January 2011, when Mayor ntnombel'g first proposed allowing
non-medallioned "livery" vehicles to accept street hails (1&, a person standing on lhe street waving 10
vacant taxicabs to be picked up, as opposed to a trip pre-arranged by telephone or other means) oUlside
of Manhattan. 1\'1 a January 18,20II e-mail to the TLC's distribution' list (Brinckerhoff 5/18/12
MTBOT Aftirm. Exh. 1), Commissioner Yassky wrote, "TomolTow, Mayor n100mberg is delivering
hi:; Ulu1ual 'State of the City' speech [in which1he will propose that Iivcry cars should be able ttl ilCccpt
street hails [under certain circumstances}," Further, "there will be a full legislative process on this (it
requires City Council approval). and ... I expect the City Council may seek {some changt:s]. • • •
Council approval is likely to take months." In an accompanying mcmontndum to the Mayor. Yal\sky
(and a co--author) note the "Need for Council Approval '" Implementing this live-borough taxi plan
will require authorizing City CO\lllcillegislation." In his January 19. 2011 "Stat'c of the eilY" adclress.
Mayor I3100mberg proposed allowing livery strt:ct hails.
Page 6 of 32
ADD7
2144
In G"rly r:ebl'uary (h~ Mayor's Otlicc of Legislative AITairs ~ublllilted 10 the City Council a prtlp(lsal hi
i.\Illcnd lh~ l\dl1liuiSIn1liv~ ('ml", 10 mllh'lri~e li\l~'ry vehicles to ;\cn:lll Sireci h...ils under \;crlaill
cunditi(ln~, The mel1:llli.,ncd "Ixicah illdu~b'Y opposed the prollllSal. lhruughuul Mm-ch :lnd Allril. Ilw
TLC and Ih~ industry Ilcguti:uetJ varitlu!'I proposals. In May, Cummissinm:r 'r'asskylr:lw",:d lu 1\lh:U1~'
seven\1 times to seek legisJativ~ sUPllurl lilr n particular "cml\prull1is~ pruposal." 11\ hlle May :mll ~arly
JUJ\e the livery induslry rdllicd iJg:lim:llh~' "cllmpromisc propM:lI:' 'Ille SIOIle I.c,g.i~h\lllrc lhen drnlkd
a bill Ih'lt essentially favored Ih,' livery inuustry nvcr the medallioned taxicab induslry. Naturally, (he
I\\cdallioncd tAxicab im.llL'itry howled.
By thell. ,IS detailed in Michllel M. Grynbaum, I.,!;Sisbuun: t\ppr(lvcs B1uolJll~rg Plilll 10 Allow SII'I.'\:1
Hnils pf LiveD' Clb~. New York Times, June 24. 2011 (Brinckerhorr 5/18112 MJ130T Atl'id. Exll. 2):
Ille polilical machinations had tnken on s "cloak and dagger" aspect:
[us o[mid·Juncj, it did not appear that the plan would happen at all. Members of till:
City Council, longtime recipients of the taxi industry'S largesse, appeared reluctant to
passit.
IT]he city's chief Albany strategislt] begsnthrowing ideas back and forth with ...
counsel rm· .. ' the Assembly speaker. What if there was a way, they wondered,to avoid
a Coullcil vote entirely?
The cruciaJ revelalion involved a simple shift of interprclation, Because oflegal quirks,
tax.i malters had long been deall with at the state level, but the Council was usually
e-xpectcd to approve any plan W1der a so-called home rule clause.
The Bloomberg team, in consultation with its lawyers. determined that this requiremcnt
was based more on tradition than any legal imperative.
Final preparations were made ()1l a frenetic Saturday. Mr. Yassky lwas watchingj ;'Dial
M tor Murder" at the Film Forum on West Houston Street; he sat in an aisle seal to
ensure he could duck out to take Mr. Lasher's many phone calls.
On June 1&, 20] 1. Assenlbly Member Car) Heastie illtroduced a bill 10 increase the number of vchicle~
allowed to pick up street hails in New York City. Similar Jegh;latioll was introduced ill Ihe Senate. 011
June 21 the Assembly passed its biU, and on June 24 the Senate pussed the SOllle bill.
Although passed by both hOllses, the bill initially encountered some rough sledding. Kenneth Loveu.
Tnx. nil! Dyinu in Albany. New York Daily News: Daily Politics, Sept. 19,2011 (available onlinc).
On October 4, amid much wrangling and posturing, Governor Coomo stated that "[t]he optimum gOlll
is to design a pion thal provides taxi access to the outer boroughs, access to the disahled, revcJ\ue [m
Ihe City, And respects the medallion franchise," On December 9 the Assembly sent the bill to th~
Governor for approval. On December 23 the Governor signed Chapter 602 oCthe Laws uf 20 II. In or
about e..'irly Fehruary, 2012. hoth legislative houses passed a "Chapter Amendment." On February 17
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tbe Ciovemnr signed Clulpter 9 of the Law!! or20l 2, which amended the prior luw. (This CO\lrt will
refcr ttl thc rcsulring I~\w, known as the "Slre~t Huil (for "1 fail Accessible Illter-borough Lic~llsc")
Livel)' Law," (IS "the SlIbjccllegislarion," as it addresses more than just street hails and livcl'y vchiclc.,:.)
The Subject (.egi~hl\iQn
Simply put, Chapter 602 or the Laws of20ll, as amended by Chapler 9 of lhe Laws of 2012
(Britlckerhoff 5118112 MTBOT Affinn. E:dl. 5), nllows tilt: Mayor 10 issue up 10 2,000 ncw taxic!l District plUli Airporls"; the ~nlrlks
somelimcs refer to it as Ihe "Hail exclusionary zone"), with drop-offs allowed anywhere~ and mandate
cerlain wheelchair-accessibility qUOtclS for medalliollcd taxicabs and HAlL vehicles. or cour~c. "Ihe
d~i1 is in the details. ,.
Seclion I (id. at I), "Legislative Iindingll," ~Iates .. in full, as tollows:
'l1le legislature finds und declares that the public health, satety and weI fare of the
residents of the state of New York traveling to, [rom and within the city ofNe\\' York is
a matter of substantial slute concem, including access to safe and reliable mass
transportation such as taxicabs. The Illajority of residents and nonresidents of the city of
New York do not currently have sufficient access to Jcsal, licensed taxicabs available
for street hails in the city of New York. Additionally, the legislature Linds and dedurc~
thaL it is a matter of})\lbJic health, safety and weJfare to ensm6 adequate and reliubJe
transportation accessible to individuals with disabilities in the city of New York.
Currently, approximately 1.8 percent of the city's approxim[ttely thirteen thousand
yellow tuxicabs is acce..~sible to individuals with disabilities, Elnd an cven smaller
percentage of the city's approxinultely twenty-three thousand livery vehicles is
accessible. This supply ohccessible vehicles is insutlicient to provide adequate and
reliable transportation for lhe residents ofand the commuters and visitors Lo New Yorl,
city who have disabilities Ilnd lherefore inhibits their basic daily activities. 111i5 lack of
accessible vehicles also prevents individuals with disabilitic:i from being able Lo rely 011
the street hail system to get to ndestination quickly, pal1icuJarly in an emergency, or to
traveJ to a location not near a subway or bus stop. Improving Ilccess to mass
transportation, including taxicab~, fol' the residents of and the commuters nnd vil,itors to
New York cit)' rUl1her these matters of substantial state concern.
Sec.tion 4 ilih at 2) authorl7..es tbe TLC to issue lip to 450 tor-hire vehicle buse station permils, for
$3,000 each, valid tor three years, wilh automatic renewal upon good-standing status and paymcnt of
the renewal fee. The initial issuance is limited to current base srations. Funhennore, the TLC "shall
nut be required to engage in any review provided for by any provision of law or make or obtain llily
detel'mination 1101 expressly required by this section:'
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SeCI ion 5 (iii. "t 3) Iluthorizes th~ TLC ti) is~ue, (lve,' the course or three years, lip In lll.OOO 11'" I,
Iicensc/;, 20% or which must be for whedchair-accessihlc vehicles. During the Iirslthrcc ycarli, IIA11.
licenses nU1Y be issued only to owncrs or for-hire vehicles or for-hire drivers who have been licensed
by the 'n.c lor CIllcnst one year nnd are in good standin& with Ihe Tl.C. HAIL liccnst:s arc valid For
thret: years. Those licenses issued the first year cost $1 ,500~ Ihe second year, S),OOO; Clnd the third
year, $4,500. The lif.'cnses are lransferable to lor-hire drivers in good standing with the TLC, Rene""'ul
is ulltomatic lIpon good-standing statull and payment of the renewal ft:c. Furthermore, the TLC "~Ilnll
not be required to engage in any review provided for by any provision ol'law or make or obtnillllllY
determination not expressly ,'cq\lired by thill acl."
Scctif.lIl 6 (i!L. at 2), the "poison pill," provides that the subjecllcgislation ".shull be construed as :t
whol~, and all parts oCit are to be read and construed together. Ifany part of this aCl ." shall he
adjudged by !lny court of competelltjllrisdiction to be invalid, the remainder of this act shall he
invalidated and shall be deemed to have not taken effect"
Set'lion 8 (ifu at 5) provides that the City "may, octing by the Mayor alone, ... '1Uthorizc the Tl.C ... to
issue lip to two thousand taxicab [medallionsl in addition to those already isslIed." The medallions arc
restricted to wheelchair-accessible vehicles; must be auctioned (thc City to profit from the procc~ds);
and must be fully transferable,
Section 9 (id. at 6) provides HAIL licensees "shall be eligihle to apply [to the TLC} for grant." ill an
amount up to fifteen thousand dollars, which shall be applied towards the costs ot" purchasing u
wheelchair-accessible vehicle or retro-fitting one to be so. "for usc as a HAIL vehicle. n,e lotal
amowlt of such gJ.'ants shall not exceed fifty·four milliun dollars."
Section II (.ld,. at 7) provides. in eftect. that medallioned laxicabs can pick up pussengcl's anywhere in
the City, bm only by street hail; HAIL vehicles can pick up passengers anywhere outside the
MC13I)+A, by streel hail or pre-arrangement; and other for-hire vehicles ean pick up pBSseng~rs (Inly
by pre-arrangement and only outside the MCBD"t-A.
Section 14 (ll!. at 9) imposes a SO,50 tax on every HAIL vehicle owner and on every anilialed 111\ II.
base tor every HAlL trip by the vehicle,
Section 23 ilik at 12) provides that in enforcing the subjeellegislalion, "lhe entity that issued the summons
1"01' [anYI violation," which apparently could mean the New York State IJolicc, the New York City Police,lhc:
'Port ofNew York AutbOlity Police, the Metropolitan Transportation Authority Police, and/or Tl.C
enforcement agents, receives and retains any money collected pursuanl thereto,
Section 31 (ill. at 15) provides that the subjectlegislarion shall take effect immediately, unless, lor Vari(lllS
specified reasons, it docs not. The subject kgislatioll apparently went into em~ctllpon signing.
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The Procedural Backgrounu
In April and May 2012, plaintiffs commenced the instant litigation, seeking:
(1) dcclaratimlS that the ~ubjectlegislatiolt violates the following provisions of the St,ltc
Conslillllion: art IX, § 2(b)(2) (the "home rule" provi~ion). ilrl HI (limiting Icgisl.llivc hram:h
delegations), art IX, § 2(b)( 1) (the "double enactment" clause); art III, § 17 (the "cxclusiw
privileges" clause); aatl, § 7 (and the Fifth Amendment to the United Stutes Constitution)
(the "takings" clauses);
(2) a declOl"lllion that the City must undertake State Environmental Quality R~vicw A..:t
review of the potential issuance of the 18,000 HAIL lic-ellscs;
(3) an injunction against implementation of thc slIbjccllcgislatioll, including, butllot limited
to. issuingl-lAJL licenses, HAIL base permits. and llew taxicab medallions; and
(4) co~us. i\lcluding rensoIHlblc attorney's fees.
In late May plaintill's moved, by Orders to Show Cause, for injunctive relief. In a June I Temporary
Rcslr:iining. Order ("TRO") Lhis Courl, solely addrcssing the "home rule" issue (see below), "temponuily
rcstmincd rd'cJcnuulltsOi. pending further order or this Court. f!'Om implementing any aspect of (he suh.icci
ICl::ishllillu. c,)nditional on plainlills culk'Ctivcly pusting IS bond." which they did. (Mostly in light (If Indny':;
u~ci:;iol1. Ihi~ Court SClrS no reas'lIl ttl address plaintitl's' complaints that defendants. particularly the "1'1 ,C.
are violating the TRO.)
Several parties ~ave moved or cross-moved, pursuant to CPLR 3212, for summary judgl1lent. SUllllllary
judgment motions "search the record," CPLR 32l2(b), and thl: Courl "may" grant summary judgment to rillY
party "entitled"lhercto. All parties agree that the cases arc ripe for summary judgment. FlIItherl1lorc,
pursuMt to CPLR 3212(e), "summary judgment may be granted as to one or morc causes of actio II. or pmt
thereof," a device of which this COUI1 is taking full advantage herein.
The "Standing" [ssuc=,
As defendants point Ollt, citing Society orthe'Pla~tics Indus.. Inc. v County ofSulTolk. 77 NY2d 7~1. 7(1)
(1991), "[s]tanding is a threshold issue that n1\\8t be established by the party seeking judicial rcvil:w.'·
Delcndant!l essentially argue that plaintiffs would not sutter "injury in fact distinct from the gCllcrul puhlic";
any it1iury would b~ specul8llve; and any injury ralls o\.\lIlide the "zone of inlerest" 10 be protected. This
Court di!mgrees. Plainliffs would, in fact, be injured by W1Y decrease in the value of their medftHions; SOlnt:
decrease is a distinct. if perhaps not definite. possibility~ IlIld plaintiffs. and all New YOI'\( City citizens. nrc
within the "zone ,of interest" of the numerous eonstitutionul provisions lIpon wltich plaintiffs rely.
Let us SlIY that Andrew lends money to Michael. Matthew cannot sue Michael for that money bCc:.1USC (Al
Matthew might somehow win. which is bad because (l) Matthew is not entitled to lhe \lloney, ond (2)
Andrew might also sue and win, subjecting Michael to n"double recovery"; and, on the other hand, (In
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Matthew might loose, which is bad be.causc (1) this might prejudice Andrew's right to reC{lver, ,md. (2), in
any event, the litigolion will have been u wasle ofre~uurccs.
lnliligation wilh a hroad public dimln~iun. slmuling is r~quired, al\ (hil' CUllrt s~cs 111", lIl:lllcr, (.,,) to insure
that Ihe pllnies hav~ ,m ~l\:tuul sli.lkc in Ihe liligatil'll :md, lhus. an in,:clllivc 10 win, whicb will fosler a CJ)ITtl'l
determination, and (11) ~o pr~vcnllll.!li'ndlllJls from havin~ 10 Icnd niT II rIlllltil'Jicit), nr duplicolive lawsuits.
As ddendams note. "faln action to dee·hue a particular law unconslitutional and invalid will 1101 lie hya
person who ha.~ no nClual and material personal interest in the determination sought." CCnlral WC§leh!;~ICr
llulllane Spcy. y Hillcboe. 202 Mise 881 (Sup Ct, Westcheslcr Counly 1952). As detendants stale. Illuinli ns
mu.'\l dcmonstrate Ihat they have "an actual legal stake in the matter in dispute."
To Ihis Court none of lhese concems are present here. Although the TSA plainlill:'i may be olle level
remuvcd from a direct economic intcre~t (not to downplay that interest), the MTBOT and GNVTA pl:Jinlifli-
rically and as II mattt:r of common knowledge, fire dcpartments have been reco[!.nizcd
agencies of 111\1nicipal govcmlllenl!\, and their organization, opcr77). Article XVII is lilbl"SociaL WcltilTc,:· and S~~tioll
.1 Ihl'ret'!' is tilled "Puhlic Ik~lllh." 'I'hus W~ have Tuwn of Islip \' C'UllIllU. 64 NY2d 50, 56-57 (19X41,
uphnldi.ng ~tntc lq~islllli()lI to Ii.,st.el· link drinking water in Nassau, Suffolk, and par\s (If Quecns Cllunli~:I,
:1I111 RohurtSlll1 \' Zilllll)erman, 26K NY 52 (\935). llpholdil1g State legislation to improve the scwer~ of
[lulrah~ In ~clle\' \' McOe~. 51 NY2d 522, 5J5 (1982), the Court recognized that the constitllli«,lnal home
I'lll\: p"\lIisinn~ "~vincc ~I recognition \haL c!lst'llti~llIy local problems should be deult with locally and that
cm.:ctiv~ local !lcll:'gn\'crnlllenl is the de:;ircd llhjcctivc." "Health and safety" have lOllg fallt'lllllldcr the
State umb)·cl101: "The ptot~"\;ti(lll ('lrlh~ puhlic hCllllh tlnd safety is one of the acknowledged purposes () f the
police power of the State." Adler v Deegan, 251 NY 467. 481 (1929). Health and safety are not coml>arahlc
to taxicab availability, If everybody in New York City died tomorrow, we would have a catrlstrophe~ ifull
housing in New York City disappeared tomorww. we would have Bdisaster; if nobody could tind a Im(ic:lb
tomorrow, we would have a hardship.
The Statc also has a strong interest in statewide uniformity. 'Ibus we have P;!lrolmcn's "cuevalsllt i':-'Hl~:
City of New Vmk, 97 NY2d 378 (2001) ("PBA U"), and Pero y City of Batavia. 99 AD2d 668 (4th DCllt
19&4),1!ffii 63 NV2d Q71 (1984). .
A reluted inlereM is in ml\tters thlll cross jurisdictional borders, Town of Islip, and Wambat addrcssed cmss·
border issues (drinking water and environmental conservation). Defendants note thol HAIL liccn5C:\ would
allow people in, ~:Ilty. Northern Manhattan to street hail a legal, licensed vehicle to take them oU(llidc of the
City, such as from the Northern Bronx to Southern Westchester. Indeed, for some time now the TLC hus
imposed a particulur rale SlmCll1rc for mcdl.lllinncd taxiC~lh trips to Nilllllau mld W~stchester Counlies. l.ivcry
vehicles al!lo calTY Jlas~cngc:rs tn lmin and hill' 1C:l'lnitml:i lor trillS outside the City. One for-hire driver !;lalc.~
(S'lntiago 61151\2 T~1 J\ftiJ. 1()) thatl\hc "regularty" 1uke." 11rc-urranged rides (a street hail would he
illegal) from norlhern Miln!ml\;m tn Wcslt:hc.c;ler and Rockland Counties ;lOci Nc"' Jersey or Connecticut (\I)
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similar effect art~ Cillrciil, 1~ and Generc. "5, 6/1 5/12 TSA Aflids.). As defendanlS noll' (Altnllliral~1l Anid.
01" 611 5i12, ~ 26):
By t~Ic.ilitatil1g tran!\porlation between New York City and points outside of lhe City.· bolh
through direct trips out of the City and through counectilllls 10 othcr (orl11s of mass
.lr:msponlltion - the (su~jcet legislalion Iwould benefit individUals and husincsscs oUlsidc or
Nt,w York City.
The majestic Grand Cenlral and (f()rmerly Illujestic) Pennsylvania Station.li, lhe tem,ini lor trips rar and wick.
are demonstrative evidence that Stote control OVCI' railway lraffic makes sense, As plaintiff!! argut:. railways
huve long been subject to State rcg\llation, are integrated into the "the State· level transportation
inli'astructuTe govcOled by [the M~tmpolitall Trllilspurtatioll Authority]," and "are owned by the g()\'ernJl1~nl
and operated as public transportation." Allhough it predales Cardo1-O's "substantial Slat~ inlerest"
pronouncement in illf.l«.~McAneny v Board nr Estimnlc nnd t\Dpurtipnmcnl, 232 NY 377, 393 (I <)12)~
"[r]apid transil tor the city of New York has. for many years, been a matter of public inlerest, al'ICct ing Jllli
only lhe people of that city, butot' the whole Stat~. It has been generally regarded as a slate offair,"
Fmthclmol'c, the 40·ycar "history of legislation on lhe llubjcct shows it." The installt record contains lillie
evidence of people taking for-hire vehicles in or oul of the City; rot' the !nost part, the vehicles stay here.
The cross·border inlerest hert is that some people might want to (8) leavc the City. wholly or partially by
taxicab; (b) street hail, rnther than prc·atTange. the ride; and (c) be unuble to find a suitahle vehicle.
Howcver, while the record demonstrntes some cross-border trafJic (2% for livery vehicles; probahly much
less for llledalJioned taxicabs), it does not reveal a pal1icular "concent" or rcason for one, or thnt allY such
concern is of a "substantial" order of magnitude. When all is said and donc, railways arc a Siale concern,
taxiCabs are a local conCcnl. If every cross-border transaction or out of town trip to the theater disll'ict
created 11 sllbstantial St~t( interest, the borders migh[ as well be abolished, and tl.,e Stale can just run
everylhing. Occa.<;ional trips across the periphery ofNew York City cannot justify the State Legislaturc in
driving a stuke through the heart ofhol1le rule.
Lastly, defendants claim a ~..trong interest in ensuring thnl our metropolis "retains its status as a worldwide
center of commerce and tourism, which requires that persons who work in and visit central Manhattan. ancl
those who arrive in the City via itll airports, have ready access to safe and reliable taxi service." Amen.
Somehow, New York City hasmunalJcd [0 establish and maintain its exalted place in world COlllnlerce and
tourism without State intertcrcilce in the quantity or (for the most part) quality of its taxicabs. DcfendnlllS
do nol claim thllt New York City is losing its edge, 01' present any evidence thaI tourists and busillcssl)Coplc
are reluctant to come here because lhere is inadequate taxicab service. Thus, Albany's parcntalism is ill-
founded, On the other hand, if the State Legislature wanted to meddle in New York City government. the
subjcct legislalion fits the bill.
The contenls of the liubjecllcgisJation arc aU New York City '·stuff." The new medallioucd laxicahs anll
HAlL vehicles would be picking up passengers, and almost always dropping them otT, in ~t:'IJ,I York Cily.
The Mayor, the TLC, the City Council, are all components of New York City government. The new
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medallions llmlli~cnscs would bt: auctioned or sold by the City. for the City's tlnancial hcnclil. The Cil)' is
lip Ln the Titsk or regulating its own t~lxicnbs.
Wheelehaif-Accessi~Hity Concerns
The ubiquitous wheelchair-accessibility provisions in the ~ubjr.c\ legislation surely are more Ihan me,'c
window drcssing. They are undoubLedly well-intentioned, hut severdble from, indeed piggy.hackl~d on, Ih~
issues of medallion supply and HAIL licenses. Moreover, the State interest in lmch could be entlclcd wilhmll
scrambling New York City government Also, the City was "first to take the ficld"~ ill passing the 20tH
medallion increase. the City C01UlCilllll1ndated thut at least 9% of the new taxis t~ whecichair-acccssihic.
Admin. Code § 19.532(h). The 150 medallion increase ill 2006 was pursuant to a '·home rule" message
rcquiring that tht:y!!ll be wheelchair-accessible. The TLC has also, long prior to The events herc in jlisut:.
fOSTered wheelchair- and service lInimal.accelisibility. See 35 RCNY §§ S9I3-17(c), 54-20, 55·20. rhus.
wheelchair-accessibility can be and h~ been addressed without State involvement, and thc Slale's !\ccmingly
sudden inleresl in it has something of a "Johnny-come-Iately" aspect.
The Enahling Legislation E;sccptiQI1
Defendants argue that the subject legiiilstioll is simply "enabling" legislation. which does no! need a h01ll1:
rule message because il simply "enables," but docs nor require, the City 10 do something, citing Weber \I
New York. 18 Mise 2d 543,546 (Sup Ct, New York County 1959),~ Salzman v Impel Jilleri, 350 NY
414 (1953). Now. thRt is all well and good, and malcc5 perfect sense: why would a home nile lncssnge be
_. necessary if the StBte is simply "clUlbling" a City to do something? However, here, the question is which
: component ot'City government b8s the power to act within a pSI1ieuhtr sphere, an issue absent !i'om lh~
tbregoing two cases. Manhattan Borough Presiden~ SCOll Stringer says that "the [subjcct] legislation duel!
not require lhat New York City take any aClion whatsoever to change the taxi system." True aguin; hut its
cardinal sin is reallocating local power without 8 home rule message or a substantial Sl.'\te interest in d()in~
so.
Til.: "I{cnsonable Rclsltil1nship" Issll~
In City of New York v IJatrolmen's BeneVOlent Assn., 89 NY2d 380.390 (1996) e'f1lAj"). the Courl of
Appeals stated that to pass home rule muster, a special law "must bear a reasonable relationship 10 Illl~
legitimate, accompanying substantia! statc concern:' Accord, Patrolmen's Benevolent Assn. v Cily Ill' Nc\,::
Ym:k. 97 NY 378, 389 (2001) (afBA.ll") (the legislation must be "rationally related to [the State] COllcem"):
City orNe", Ynrk v Stote of New York. 94 NY2d 577.590 (2000). Indeed, a :;lalutc Lhat "merely bears
:lome n:lalionship" rUlls atoul of home rule requirements. paA I, 89 NY2d at 390-91. As JUdge Curdo;,..(),
cOllculTing in Adler, 251 NY at 490, put ii, the State concern must he "direclly and substantiMlIy involve,!."
Whether the subject It:gislalioll is "reasonably" or "rationally" related to an asserted State interesl musl be
addre~:led in the context ofNew York's protective approach towards "home ..ule." NY Const, al'l IX, §
2(c)(ii)( I) provides that "every local. government-shall have power to adopt and amend local laws ... rc1atin~
lO the ... powers ... of its ofiiccrs.·' The subject legislation trammels that power. Grants of local tlulO\lOmy.
of the sort at issue here. ahound in the statute books. For example, General Municipal Lnw ["GML" j § IBI.
urigilllllly aClcd in 1956, allows cities to re~ulate "lhe registration and licensil\g" of taxicabs w,d expressly
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:1l1lhori2.Cll cilies lo 1;limil thc number of laxicabs to be licensed." Plaintiffs n()t~ (MTH01: CplL 177) thai in
\983 the New York AILorm:y General opined lhat GML 18 \ is "viewed as a home rule measure to give
municipalities power they properly should have." 1983 NY Gp. Ally. Gen. 1008. The J.egislottll'c saw till'
provisions as a "mcans to enable local governments 10 deal with the problem of an OVCI' supply Dr tnxictlhs
lhat would both handicap drivers in their ability 10 make an adc~uute living and complicate cOlltrol,,!"
vehicular frallic on streets already overburdened with too may cars:" rd.
Plaintiffs plausibly argue (MTAOT epll' 5) that the ~ubject legislation "gives Assembly Members and St.I1C
Senators from rumI and suburban New YOI'k State more say over livery cabs in Queens than the QUCl~llS
members ofthe New York City Council." How would an upstate legislator know whether Ihe ManhaUull
Central Business District ends al 96'h Street on the east side und 110'10 Street on the west side. or vice vcrsll.
But every New York Cify Council member probably would. On lhe other hand. City Councilmcmhcrs from
SlCltcnlslandpl'obabl)' would 110t have a clue ahout the contours of the eentrdl husine.'l~ district or
Schenectady.
Dc1cndllnts themsclves emphasizc that the Mayur is not obligated to issue medalli-ons~ so by lhibility plan either shaIJ contain a recommendation tor the percen18gc o!'
HAIL licenses issued in U1C second and third issuancc:l to be restricted to accessible vchicl~li.
or if no recommendation is made, the required percentage of HAIL licenses restricted to
acccssibJ~ vehicles sct forlh tor the first issuance shall remain in eITcct for the seconu and
third issuances, anti the TLC shall continue to require that for every block of one thouliund
HATI~ liccl1l;es issued, the twenty percent requirement provided in subdivision (b) ofsection
live of this act must be met prior to the issuance of any additiol'lal HAIL licenses.
Wouldn't it jusl be easier to mandate that a certain percentage of ill taxicabs in all cities (not just New York I
be wheelchair-accessible, and let each locality go about deciding how to achieve thot worlhy aonl'?
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The detail inl.: ludes dictating the precise distance that a rogue drivel must travel before he or ~hc. will he
deemed to have attempted to CSC(\PC the clntcllcS ora taxicab enforcement onicer (if you ~~ucssc.d ilnylhing
olher than 300 leet. you gll~ssed incorrectly). Isn't this something that New York City can determinc
without the Stale interference'? Dne~ State government have a "substantial interest" in setting this ciisl:1ncc
at eXllctly 300 fect?
Derendants argue as lollows:
it" Ihe Isubject legislation] had simply directed the TLC to issue exactly 2,000 lllc.duilions,
plaintiffs would not be complaining that the IltW reapporlioned powel· within city govcrnmcllI.
But bectluse the law allows thc Mayor to determine lhat.1ewer than 2,(}()O medallions will he
issued .an option one would think plaintiiTs might welcome - !luddenly, accmding to
plaintiffs, the law r~llllocates power within city government.
But that is exactly what the luw does. If the State had, or even thought it had,a substnnliul interc:.1 in more
mCtbllions it could h~lve dictated that they be issued. Plaintiffs might still have challenged the: 1~IW 011 home
rule grounds, but then it would only be a law about the number of medallions. Instead, the subject
legislation says to the Mayor. "you decide." Until now, the City COllneil had been "the decider." To allow
the Mayor, suddenly, atkr all these years, to decide whether to issue new medallions, and, if so, how mall)'.
is the cmbndinlent of reallocating power. and nms roughshod over \~,.hat had heretofore bct:n the (\ml1ciI's
prerogative.
finally. tltis Court agrcl.:s with plaintiffs that the snbject legislation purloins the power of the purse.
Detendants claim that the subject Icgislation does not "authorize [the fine-collecting] agencies to spt:lld the
funds lhey collect a mailer that remains governed by other sources of State 01' local law." PlaintilTs claim
that the subject I~gislaliol\ "gives executive branch entbrcement agencies carte blanchc to keep ilml tlsC' as
they see lit any funds they collect enforcing [the subject legislation], removing forever fmm the Cil)' Cuum:il
its budget ovcrsight aUlhority over such funds:' The subject legislation appears to be mute on Ihis point.
In any event, economic self-delenninntioll is essential to any rational fonn of government. (Q:, "T"xal inn
without repl'esentation is tyranny.") NY Const art rx, §§ 2(c)(3) and (4). guaranty to the City the rig,ht 1o
"transuc[tl its business" and "incu[r] its obligations." The City Charter, Chaptcr1 0, requires the City
Council to approve all expenditures. ')1,C subject legislation exposes the City to as much ns S54,OOO.I)()O in
grants (albeit [or the laudable goal of wheelchair·accessibility). Breaking open the City's piggy bank is a
slippery slope. The subject legislation also, as plaintiffs argue, creates a "bounty system" whereby ;'Itlw
enforcement agencies at both the state and locallcvel [can] fund them!le1vcs off-budget." Thi~ deprives Lhe
City Council of it~ right to earnlark funds for these agencies, and, at least at first bhlSh. appears to allow
the.1n untettered discretion as to how to spend the subjcct funds. As Judge Cardow wrote in Adler. 25 I NY
at 489, "rt]here are some affairs intimately connected with the exerci~e by the chy of it:'> corporale fUllClions.
which are city affairs only. ••• Most important of all perhaps is the control of the )ocBlity over payment:;
froUl the local purse:'
Page 25 of 32
ADD26
2163
Jlome Rule CQnclu~iQ.!!
In the tinal analysill, the suhject legislation violales the "home rule" provisi(ll1:i ur the State Constitlltion till"
twO independent reasons: (I) as i.l mull!:r of history and common sense, Nt:w York'City taxic.;J!> servi\:c is llO!
u m~ll1er of substantial State interesl oJr C(lnc~m (and to deem it otherwise would largely eviscerate the
concept of "home rule"); and (2) ti law that shins power Irom lhc CilY's legislative nnlllch 10 iis cxcclItivc
bra'neh, and micro-manages the exercil;c of that power, rails to bear fl reasonable relatiollshir 10 any such
intercst or concern, As plainliffs argue, "[(Joe,tl Governance - protected by the ... Homc Rule Arliclc-·
means nothing if not the power to determine the prccise funclions and powcrs thal will be wielded hy
coordinate br:UlChcs of government." Indeed, one can imagine a scenario in which it series of "thmw lile
bums out" election results could trigger helter-skelter Stllte legislation pinballing power back and forth
between whichever branch of City government the State agreed with 01" wanted to favor laintiffs c1nim thut the
i.~sullnee or any HAIL licenses would also require compliance. This Court strongly disagrees. 'Thc Stale had
the authority to exempt the issuance of the HAIL licenses from State-mandated SEQRA review and. as
defendants argue. notwithstanding plaintiffs' gyrations, the State did just that The "no rcvi~w" cla\lscs in
Sections 4 and 5 mtHt likely preclude environmenL.'\1 review, because no other review would be necessary.
Also. again as defendants argue, use of1he word '"review," rather than some standard langllage like '::lIlY
olher provision of law to the contrary notwithstanding," points straight at "environmentLlI review"~ ", Ihey H1"C
doing whul the lu,," requires, this Courl wishe~ tll register ils strong disagreement with defendants' position
that [h~ subject legislation does not atTcet plaintiffs, envinmmcntally speaking, any morc Ihan the public at
large. Anyone wh() has ever driven II taxicab in the MCBO+A kllOWS the imllledillte, draillatic cllccts of
increased troll1ic congc.c;tion nnd air pollution on "the bottom line" and on the quality of life, respeclively.
~cc ill. n: l·Q1!llnn...Ji.!l'.rcs\'·r~ ... Brightoll Beach ilnd M~nh;\I\qn Bench v'l'h"minl1 Cs\DUnn, or ('iI\ .n[ NI:.~Y
York., 259 A1J2d 26,32 (lst Dept 1999) (holding that "noise and traffic" problems and '\:ontaminants \0 he
released into Ihe air" arc the "ne!lthetic or qllality of life type of injuries fthat] have consistently been
r~cog\lilcd by courts :IS a basis for standing" under SEQRA).
I LE D
Cllll~IU!ljon .
Thus, t,)r the reasons sel forth herein, and pursuant LO CPLR 300land 3212, this Courl declares r1J lhal
Chapler 602 ofthe Laws of New York of2011, as amended by Chapter 9 ofthe Laws of2012, violules New
York Stmc t'nn:'ltillllitm Al"ticl~ IX, § 1(h)(2) (the "Home Rule Clause"), Arlicle IX, § 2(b){l) (Ihe "Double
Enlll:lntClIl ('1:Julie")••mel Article 1.11. § 17 (the "Exclusive Privileges Clallse"); [21 that pursuant Lo Section 6
Ill' slli,II<"gislaliul1. the entire :l<.~t ilC llull Hild vClid; 13)tbat said legislation does not violate the FiIlh
All\cnt!m\'nt hI th~ United Stllies CunsHtlltion or Arlicle 1. § 7 of the New Ynrk Stale CCllllilitllticlIl (Ihe
"']'okings Clauses"): IAlthat said legislation does not violmc Article "Ilpnll\illiun~ illlJlrtljll:r dcll'galilllll\ Ill'
legislative puwel') of the New York State ConstiLution: 151 lhal I.hc Cily f\f New York W(llll,l 'lClt ]'l\c' phliu.aLl'd
1'\ pcrlhrll1.lt rcview, Ilu\,surml III Ihe Stutc or Cily Environmental (JlIalily R~\'it"\" Act,;, l,f allY illSllanCl:s ,,1'
"HAIL"licl'lllo"Cs pursuant tt) Ihe sll~jl"(.'t legi!lhtlion; and [6} thatlo dille, defc:ndanl'n\(~City orNcw Yh
ip
hl
:'t
w
ee
n
ro
m
pl
ln
ie
s
w
ri
ti
n
g
in
su
ra
nr
'e
po
li
ei
es
or
bo
nd
s
fo
r
ta
xi
ca
b
op
en
lt
or
s
an
d
th
e
fi
na
nc
ia
l
re
sp
on
si
bi
li
ty
o
f
su
ch
co
m
pa
ni
l:'
s,
th
c
su
ff
i..
.i!
'n
ey
of
th
c
pr
ot
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ct
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n
of
fe
rl
:'d
an
d
~
u
p
p
l
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by
su
ch
eo
m
pa
ni
es
to
th
e
pu
bl
ie
an
d
to
th
ei
r
as
su
re
d,
th
e
co
nd
it
io
ns
an
d
w
ag
es
of
la
ho
r
em
pl
oy
ed
in
su
ch
in
du
f>
t.r
y,
th
e
pu
bl
ic
n!
'('
es
si
ty
in
su
ch
ci
ti
es
to
bl
:'
sl
:'r
ve
d
by
ta
xi
ca
b
op
er
at
io
ns
an
d
in
to
ev
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y
m
at
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r
an
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th
in
g
w
ha
ts
oe
ve
r
co
nn
ec
te
d
th
er
ew
it
h
o
r
re
la
ti
ng
th
er
et
o,
an
d
of
ea
ch
an
d
ev
er
y
of
fi
ce
r,
co
m
m
is
si
on
,
ag
en
cy
,
bo
ar
d.
bu
re
au
o
r
d
ep
ar
tm
en
t
of
th
is
S
ta
te
o
r
an
y
po
li
ti
ca
l
su
bd
iv
is
io
n
th
er
eo
f
in
an
y
m
an
n!
'r
('o
nn
ec
te
d
th
er
ew
it
h
in
an
y
an
\l
ev
er
y
re
sp
ec
t
w
hl
lt
so
ev
er
,
an
d
of
ea
ch
an
(l
ev
er
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ot
he
r
pe
rs
on
,
fi
rm
,
as
so
ci
at
io
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of
pl
:'r
so
ns
or
eo
rp
or
at
in
n
in
an
y
m
an
n
er
eo
nn
('e
te
d
th
er
ew
it
h
in
an
y
an
d
ev
er
y
re
sp
ec
t
w
ha
ts
oe
ve
r.
I
T
he
in
ve
st
ig
at
io
n
of
su
ch
co
m
m
it
tl
:'r
m
ay
in
cl
ud
c
('
w
ry
m
at
t!
'r
an
d
th
in
g
no
t
sp
l'c
if
ie
al
ly
m
en
ti
on
ed
in
th
is
re
so
lu
ti
on
dl
:'l
'm
ed
by
th
e
co
m
m
it
te
e
co
m
pe
te
nt
,
re
le
va
nt
an
d
m
at
cr
il
ll
in
th
e
11
sc
er
t1
1i
n.
m
en
t
of
th
e
tr
u
e
si
tu
at
io
n
re
sp
cc
ti
ng
-
th
e
in
te
n
t
an
d
pu
rp
os
e
(I
f
th
es
e
re
so
lu
ti
on
s
or
in
te
nd
ed
so
to
be
.
as
th
on
gh
sp
c(
'if
ie
p
r
o
v
i
~
i
n
n
an
d
au
th
o
ri
ty
th
er
ef
o
r
h
ad
be
en
ex
pr
es
sl
y
g
ra
n
te
d
he
re
in
.
T
h
at
su
eh
co
m
m
it
te
e
be
an
d
is
he
re
by
au
th
or
i7
.e
d
to
si
t
in
Jl
nb
lie
or
in
pr
iv
at
e,
in
su
ch
pl
ae
.e
or
pl
ae
es
in
th
l'
S
ta
te
of
N
l:'
w
Y
or
k
as
it
m
ay
de
te
rm
in
e
tD
co
nd
uc
t
th
e
in
vl
:'s
ti
ga
ti
on
he
re
in
l"
on
te
m
.
pl
at
ed
an
d
au
th
or
iz
ed
o
r
in
tf
'n
de
d
::to
to
be
d
u
ri
n
g
th
e
pr
es
en
t
se
ss
io
n,
or
,
if
de
em
ed
ne
ee
ss
ar
y
by
th
e
eo
m
m
it
te
e,
af
te
r
th
p
ad
jo
u
rn
m
en
t
th
f'
re
of
w
it
h
th
e
::t
am
e
fu
ll
po
w
er
an
d
au
th
or
it
y
su
eh
co
m
m
it
te
e
w
ou
ld
or
co
ul
d
ha
ve
w
rr
e
th
l:'
I.J
eg
if>
}a
tu
rl:
'
iu
se
ss
i(l
TI
to
ch
oo
se
fr
om
am
on
g'
it
s
m
f'm
be
rs
a
ch
ai
rm
an
an
d
a
vi
cl
:'-
eh
ai
rm
an
,
to
em
pl
oy
a
se
('
re
ta
ry
,
c
o
u
n
~
e
l
,
ac
co
un
ta
nt
s,
e(
'o
no
m
is
ts
,
ex
pe
rt
s
an
d
su
cb
ot
he
r
as
si
st
an
ts
as
lt
m
ay
oe
em
ne
c(
's
sa
ry
;
to
R
ub
po
en
a
w
itn
es
.s
es
,
ta
ke
te
st
im
on
y
an
n
eo
m
pp
l
th
e
pr
od
uc
ti
on
o
f
bo
ok
s,
pa
pe
rs
.
do
eu
m
en
ts
an
d
o
th
er
ev
id
en
f'P
"
ei
th
f'
r
in
pu
bl
ic
or
in
pr
iv
at
e.
de
em
ed
by
th
e
co
m
m
it
te
e
to
ap
p
er
ta
in
to
or
be
eo
nn
ec
te
d
w
it
b
or
l'l
5
be
ar
in
g
np
on
th
is
in
ve
st
ig
at
io
n
or
th
e
su
bj
l:'
ct
m
at
te
r
th
er
eo
f,
ei
th
er
di
I'e
ct
ly
or
in
di
re
('
tl
y;
to
ha
ve
lIe
('e
SH
to
an
ex
am
in
at
io
n
by
it
s
m
em
be
rs
.
('(
lu
ns
el
o
r
em
pl
oy
ee
s.
of
ul
l
re
co
rd
s,
bo
ok
s,
pa
pe
rs
an
d
dO
<:
U
ln
en
ts
,
of
ea
ch
an
d
al
l
pa
st
or
pr
es
en
t
pe
rs
on
s
li
nd
co
rp
or
a·
ti
on
s
en
ga
ge
d
or
en
ga
gi
ng
in
th
e
bu
si
ne
ss
of
ta
xi
ca
b
op
er
at
io
n
or
in
th
e
bn
si
ne
s.
s
of
w
ri
ti
ng
o
r
fu
rn
is
hi
ng
in
su
ra
nc
e,
in
sn
ra
nc
e
po
lio
ci
es
o
r
bo
no
s
fo
r
su
ch
bu
si
ne
ss
,
o
r
in
th
e
bu
si
ne
ss
of
se
ll
in
g
or
fi
na
nc
in
g
th
!'
sa
le
of
ta
xi
ca
bs
or
m
ot
or
ve
hi
cl
es
in
te
nd
l:'
d
to
be
us
ed
as
su
eh
,
or
in
th
e
bu
si
ne
ss
of
or
gu
ni
zi
ng
as
s(
lc
ia
ti
on
s
of
O
pl
:'r
at
D
rs
,
O
W
IH
'r
s,
I!
'ss
l:'
es
an
d
o
th
er
pe
rs
on
s
en
ga
ge
d
in
sa
id
bu
si
ne
ss
(i
ne
lu
d-
il
lg
la
bo
r)
,
an
d
ot
he
rw
is
e
to
ha
V
l'
al
l
th
e
po
w
er
an
d
uu
th
or
it
y
of
a
('o
ll
ll
ui
tt
ee
of
th
e
L
l:
'g
is
la
tu
re
.
T
he
co
m
m
it
te
e
m
ay
,
at
an
y
ti
m
e
an
d
fr
om
ti
m
e
to
ti
m
e,
by
rp
so
lu
ti
on
of
a
m
aj
or
it
y
of
it
s
m
em
be
rs
,
be
su
bd
iv
id
ed
in
to
su
b.
C
O
lll
lll
itt
ee
s
of
su
ch
nu
m
be
r
as
th
e
('o
m
m
it
te
e
nl
llY
de
te
rm
in
e.
S
uc
h
su
bc
ol
ll
m
it
te
es
m
ay
si
t,
in
pn
hl
ic
or
in
pr
iv
at
e,
as
th
ey
ID
ay
de
te
r-
m
il
le
at
th
e
sa
m
e
o
r
di
ff
er
en
t
ti
m
es
an
d
pl
ac
es
in
th
l:'
S
ta
te
of
N
ew
Y
or
k.
S
uc
h
su
bc
om
m
it
te
e
sh
al
l
ha
ye
an
d
PO
SS
l:'S
S
an
d
m
ay
l:x
el
'c
is
e
al
l
th
e
po
w
er
s
an
d
au
th
o
ri
ty
he
re
by
('
on
fe
ne
d
up
on
th
e
C
O
lll
l1
1i
tte
e
as
su
eh
,
or
to
w
hi
ch
it
m
ay
be
in
an
y
ll
la
nn
er
en
ti
tl
ed
.
T
he
('o
ln
In
it
te
e
sh
al
l
ha
ve
fu
ll
]l
ow
er
a1
1(
l
au
th
or
it
y
an
d
it
sh
al
l
be
it
s
du
ty
to
pr
os
ee
ut
e
it
s
in
qu
ir
y
an
d
st
ul
ly
w
it
h
al
l
du
e
sp
ee
d
an
d
in
ev
er
y
di
re
ct
io
n
an
d
by
an
y
an
d
ev
er
y
Il
lf
'a
ns
in
it
s
ju
dg
-
m
"l
It
to
ob
ta
in
fu
ll
co
m
pl
et
e,
tr
ue
,
ac
cu
ra
te
au
d
co
rr
ec
t
in
fo
rm
a-
ti
on
an
d
cl
at
a
in
re
g
ar
d
to
an
(]
to
sp
ee
di
ly
re
po
rt
up
on
m
at
te
rs
'
('
on
te
m
pl
at
ed
by
th
is
re
so
lu
ti
on
,
w
it
h
su
ch
su
gg
es
ti
on
s
an
d
re
eO
lll
-
1l
ll
'u
da
ti
on
s,
if
an
y,
it
de
em
s
sh
al
l
ha
ve
th
e
cO
ll
si
de
ra
ti
on
an
d
a(
'ti
on
b
y
th
e
L
eg
is
la
tu
re
;
aT
Ill
be
it
fu
rt
h
er
R
es
ol
ve
d,
T
h
at
w
he
ne
ve
r
in
it
s
ju
dg
'n
lp
.n
t
th
e
pu
bl
ic
in
te
rl
:'s
t
de
ll
la
nd
s,
th
e
co
m
m
it
te
e
or
su
bc
om
m
it
te
e
m
ay
dr
te
rm
in
!'
th
at
a
l)
t'
r~
Ol
1
sh
al
l
no
t
be
ex
cu
se
d
fr
om
at
te
nd
in
g
an
d
te
st
if
yi
ng
be
fo
re
f>
lli
tl
co
m
m
it
te
e
or
be
fo
re
an
y
su
bc
om
m
it
te
e
th
er
eo
f
or
fr
om
pr
o-
dn
ei
ug
bo
o}
;:"
.
pa
pe
rs
an
d
do
eu
ID
en
t.<
;
be
fo
re
th
e
co
m
m
it
te
!',
o
r
be
fo
re
su
ch
su
be
om
m
it
te
e
in
ob
eo
ie
nc
e
to
it
s
su
bp
O
f'n
a
on
th
e
gr
ou
nd
th
at
th
e
te
st
im
on
y,
or
ev
id
en
ce
,
do
cu
m
en
t·
ar
y
or
ot
he
rw
is
e,
re
qu
ir
ed
of
hi
m
lII
ay
te
nd
to
in
cr
im
in
at
e
hi
m
or
to
su
bj
ec
t
hi
m
to
a
pe
na
lt
y
or
fo
rf
ei
tu
re
;
b
n
t
no
pe
rs
on
so
aH
el
H
li
llg
/l
nd
te
st
if
yi
ng
or
pr
o-
tl
m
'in
g
bo
ok
s.
pa
pl
:'r
s
or
do
cu
m
en
ts
,
w
ho
ha
s
dn
ly
cl
ai
m
ed
ex
cu
se
IJ
r
pr
iv
il
eg
e,
w
hi
eh
w
on
ld
be
sn
ff
ie
ie
llt
.
ex
ce
pt
fo
r
th
is
pr
ov
is
io
n
of
th
is
re
so
lu
ti
on
an
d
w
hi
ch
sa
id
ex
eu
se
o
r
pr
iy
il
eg
e
hi
lS
bl
:'e
n
,·x
jJ
re
ss
ly
de
si
re
d
l~
y
th
e
co
m
m
it
te
e,
sh
al
l
be
su
bj
ec
te
o
to
pr
os
ec
n-
ti
on
or
to
an
y
pe
na
lt
y
or
fo
rf
l:
'it
ur
e
fo
r
o
r
on
ac
co
un
t
of
th
e
tr
an
sa
ct
io
n,
m
at
te
r
or
th
in
g
co
nc
er
ni
ng
w
hi
ch
hl
:'
m
llY
as
Il
fo
re
-
sa
id
te
st
if
y
or
pr
od
ue
e
ev
id
en
ce
,
do
cu
m
pn
ta
ry
or
ot
he
rw
is
e,
be
fo
re
su
eh
co
m
m
it
te
e
or
su
be
ol
ll
m
it
te
e
in
ob
ed
ie
nc
e
to
it
s
sn
bp
oe
na
;
an
d
be
it
fu
rt
h
er
R
es
ol
ve
d,
T
h
at
va
ca
ne
ie
s
in
th
e
m
em
be
rs
hi
p
of
sa
id
eo
m
m
it
te
e
sh
al
l
be
fi
Il
ed
by
th
e
of
fi
ce
rs
au
tb
or
i7
.e
d
to
m
ak
e
th
e
or
ig
in
al
ap
po
in
tm
en
ts
re
sp
ee
ti
ve
ly
.
T
he
m
em
be
rs
of
th
e
eo
m
m
it
te
e
sh
al
l
re
ce
iv
e
no
co
m
pe
ns
at
io
n
fo
r
th
ei
r
se
rv
ic
es
bu
t
sh
al
l
be
en
ti
tl
ed
ADD57
20
m
ea
ns
u
n
p
ai
d
m
il
ea
ge
ad
de
d
to
co
st
s
an
d
ha
zl
lr
ds
.
It
is
ca
ns
ed
,
yo
ur
co
m
m
it
te
e
f
i
n
J
~
,
by
a
la
ck
of
or
ga
ni
za
ti
on
in
th
e
in
dw
:;
tr
y,
an
d
by
an
in
su
ff
ic
ie
nt
nu
m
be
r
of
pr
op
er
ly
lo
ca
te
d
an
d
de
i'l
ig
na
tp
d
pu
bl
ic
ha
ck
st
an
ds
in
th
e
ci
ty
of
N
ew
Y
or
k,
pa
rt
ic
ul
ar
ly
in
th
e
el
on
ga
te
d
bo
ro
ug
h
of
M
an
ha
tt
an
.
Y
ou
r
co
m
m
it
te
e
fi
nd
s
th
at
th
e
de
si
gn
at
io
n
an
d
es
ta
bl
is
hm
en
t
of
an
ad
eq
ua
te
nu
m
be
r
of
pr
op
er
ly
lo
ca
te
d
ha
ck
st
an
ds
,
se
le
ct
ed
w
it
h
pr
op
er
re
ga
rd
to
th
e
flo
w
of
tr
af
fi
c
an
d
th
e
pr
es
en
ce
of
ot
he
r
tra
n!
:;-
po
rt
al
io
n
fa
ci
lit
.ie
!:;
,
as
w
el
l
as
ve
hi
cu
la
r
tr
af
fi
c,
w
ill
gr
ea
tl
y
im
pr
ov
e
th
e
ch
ll
ra
ct
er
of
ta
xi
ca
b
se
rv
ic
e
in
N
ew
Y
or
k
C
it
y,
ob
vi
at
e
c
r
u
i
~
i
n
~
,
re
du
ce
it
s
ha
za
rd
s,
de
cr
ea
se
th
e
nu
m
be
r
of
ac
ci
de
nt
s,
re
li
ev
e
ve
hi
cn
-
la
r
ro
ng
es
ti
on
an
d
en
ur
e
to
th
e
pr
of
it
of
la
bo
r
an
d
ca
pi
ta
l
el
lR
'a
ge
d
in
th
e
ta
xi
ca
b
in
du
st
ry
.
T
o
th
at
en
d
yo
ur
co
m
m
it
te
e
ha
s
m
ad
e
a
re
co
m
l1
1e
nd
at
io
n
he
re
in
af
te
r
se
t
fo
rt
h.
Y
ou
r
co
m
m
it
te
e
fi
nd
s
th
at
w
it
ho
ut
re
gu
la
ti
on
of
th
e
fo
rm
he
re
in
re
co
m
m
en
uc
d,
th
e
la
rg
er
ci
ti
es
ar
e
fe
rt
il
e
fi
el
ds
fo
r
pe
ri
od
ic
al
in
va
si
on
by
ll
lr
ge
fl
ee
ts
of
cu
t-
ra
te
ta
xi
ca
bs
,
in
te
n!
:;i
fy
in
g
tI
le
tr
af
fi
c
pr
ob
le
m
by
un
ne
ce
ss
ar
il
y
in
cr
ea
si
ng
th
e
nu
m
be
r
of
ta
xi
ca
bs
be
yo
nd
th
e
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y,
th
re
at
en
in
g
an
d
of
tl
'n
pr
e-
ci
pi
ta
ti
ng
"r
at
e-
w
ar
s,
"
ad
ve
rs
el
y
af
fe
ct
in
g
th
e
m
or
al
e
of
th
e
ta
xi
-
ca
b
la
ho
r
pe
rm
an
en
tl
y
em
pl
oy
ed
in
op
er
at
io
n
an
d
cr
ea
ti
ng
a
fo
rm
of
co
m
pe
ti
ti
on
w
hi
ch
be
co
m
es
m
en
ac
in
g
to
th
e
in
du
st
ry
an
d
to
th
e
pu
bl
ic
.
In
su
rv
ey
in
g
th
e
p
as
t
an
d
at
te
m
p
ti
n
g
to
ap
pr
ai
se
th
c
fu
tu
re
of
th
e
co
nt
ro
l
of
ta
xi
ca
b
op
er
at
io
n
in
N
ew
Y
or
k
C
it
y,
yo
ur
co
m
-
m
it
te
e
ha
s
de
te
rm
in
ed
,
af
te
r
he
ar
in
g
ac
cr
ed
it
ed
rc
pr
C
il
en
tl
lt
iv
es
of
th
e
l
e
a
d
i
n
~
ci
vi
c
an
d
tr
ad
e
or
ga
ni
za
ti
on
s
of
th
e
ci
ty
of
N
ew
Y
or
k,
to
re
co
m
m
en
d
to
th
is
L
eg
is
la
tu
re
th
at
su
pe
rv
is
or
y
an
d
re
gu
la
to
ry
co
nt
ro
l
be
lo
dg
ed
in
an
d
ve
st
ed
w
it
h
th
e
D
ep
ar
tm
en
t
of
P
ub
li
c
S
er
vi
ce
.
Jo
h
n
E
.
G
ra
tk
e,
M
a
n
a
!
!
:
i
n
~
D
ir
ec
to
r
of
T
he
B
ro
ad
w
ay
A
ss
oc
ia
-
ti
on
,
te
st
if
ie
d
be
fo
re
y
o
u
r
co
m
m
it
te
e
th
at
th
e
m
em
he
rs
hi
p
of
hi
s
or
ga
ni
za
ti
on
,
af
te
r
ha
vi
ng
m
ad
l'
a
st
u
d
y
of
th
e
ta
.."{
ic
ab
pr
ob
le
m
,
"f
e
lt
th
at
th
e
ta
xi
ca
b
in
o
n
st
ry
is
of
su
ff
ic
ie
nt
im
po
rt
an
re
in
N
ew
Y
or
k
to
he
re
gu
la
te
d
th
e
sa
m
e
as
ot
he
r
tr
an
si
t
li
n
es
"
an
d
th
at
"t
h
e
ge
ne
ra
l
se
t-
up
of
th
e
T
ra
n
si
t
C
om
m
is
si
on
is
su
ch
th
at
it
is
ju
st
an
id
ea
l
au
th
or
it
y
to
pl
ac
e
th
e
ta
xi
ca
b
in
du
st
ry
in
th
ei
r
ha
nd
s,
"
M
r.
G
ra
tk
e
po
in
te
d
o
u
t
to
yo
ur
co
m
m
it
te
e
th
at
"N
ew
Y
or
k
C
it
y
is
th
e
on
ly
pl
ac
e
of
ov
er
1,
00
0,
00
0
po
pu
la
ti
on
in
th
e
U
ni
te
d
S
ta
te
s
in
w
hi
ch
th
er
e
is
no
le
gi
sl
at
io
n,
"
by
w
hi
ch
"t
h
e
ta
xi
ca
b
is
tr
ea
te
d
as
a
pu
bl
ic
ut
il
it
y
an
d
re
qu
ir
ed
to
se
cu
re
ce
rt
if
ic
at
es
of
pu
bl
ic
co
nv
en
ie
nc
e
an
d
nc
ce
ss
it
y.
"
In
a
ca
re
fu
ll
y
pr
ep
ar
er
l
m
em
or
an
du
m
su
bm
it
te
d
to
y
o
u
r
co
m
-
m
it
te
e
by
T
he
B
ro
ad
w
ay
A
ss
oc
ia
ti
on
it
is
st
at
ed
th
a
t"
it
sh
ou
ld
be
po
in
te
d
ou
t
th
at
th
e
T
ra
n
si
t
C
om
m
is
si
on
is
pa
rt
ic
ul
ar
ly
su
it
ed
to
th
e
ta
sk
pr
op
os
ed
to
be
as
si
gn
ed
to
it
.
T
hi
s
bo
dy
is
pr
ob
ab
ly
un
iq
ue
in
th
e
U
ni
te
d
S
ta
te
8
in
it
s
or
ga
ni
za
ti
on
as
a
ho
dy
po
li
ti
c.
It
is
th
e
di
re
ct
ag
en
t
of
th
e
S
ta
te
IJ
eg
is
la
tu
re
,
w
it
h
it
s
th
re
e
co
m
-
m
is
si
on
er
s,
w
ho
m
us
t
be
re
si
de
nt
s
of
th
e
ci
ty
of
N
ew
Y
or
k
ap
po
in
te
d
by
th
e
G
ov
er
no
r.
It
is
ve
st
ed
w
it
h
th
e
br
oa
d
au
th
or
it
y
de
ri
ve
d
21
fr
om
th
e
ex
er
ci
se
of
th
e
po
li
ce
po
w
er
of
th
e
S
ta
te
,
ye
t
it
s
ju
ri
s-
di
ct
io
n
is
co
nf
in
ed
to
th
e
re
gu
la
ti
on
of
lo
ca
l
pu
bl
ic
tr
au
sp
or
ta
ti
on
in
th
e
ci
tv
of
N
ew
Y
or
k.
"
F
o
r
ye
ar
s
th
e
C
om
m
is
si
on
ha
s
ex
er
ci
se
d,
w
it
ho
ut
di
sc
ri
m
in
a-
ti
on
an
d
to
th
e
ge
ne
ra
l
sa
ti
sf
ac
ti
on
of
al
l
co
nc
er
ne
d,
ju
ri
sd
ic
ti
on
ov
er
th
e
re
gu
la
ti
on
of
om
ni
bu
s
li
ne
s,
ra
ng
in
g
in
si
ze
fr
om
th
e
sm
al
l
in
de
pe
nd
en
ts
op
er
at
.in
g
no
m
or
e
th
an
tw
o
bu
se
s
to
la
rg
e
co
m
pa
ni
es
su
ch
as
th
e
F
if
th
A
ve
nu
e
C
oa
ch
C
om
pa
ny
,
th
e
B
ro
ok
ly
n
B
us
C
or
po
ra
ti
on
an
d
th
e
S
ur
fa
ce
T
ra
ns
po
rt
at
ir
m
C
or
po
ra
ti
on
,
w
hi
ch
op
er
at
e
m
an
y
hu
nd
re
ds
of
ve
hi
cl
es
.
"D
u
ri
n
g
th
e
S
pe
ci
al
S
es
si
on
of
19
34
th
e
T
ra
n
si
t
C
om
m
is
si
on
's
au
th
o
ri
ty
w
as
ex
te
nd
ed
to
in
cl
ud
e
th
e
in
sp
ec
ti
on
an
d,
in
ce
rt
ai
n
de
ta
il
s,
th
e
re
gu
la
ti
on
of
bu
se
s
no
t
op
er
at
ed
nl
ld
er
fr
an
ch
is
es
,
su
ch
as
sc
ho
ol
,
si
gh
t-
se
ei
ng
an
d
si
m
il
ar
ve
hi
cl
es
ow
n(
'u
hy
in
de
-
pe
nd
en
ts
,
as
w
el
l
as
by
la
rg
e
co
nc
er
ns
."
Ja
m
es
A
.
:M
cC
ar
th
y,
S
ec
re
ta
ry
of
th
e
5t
h
A
ve
nu
e
A
ss
oc
ia
ti
ol
l,
te
st
if
ie
d
be
fo
re
y
o
u
r
co
m
m
it
te
e.
H
is
or
ga
ni
za
ti
on
is
co
m
po
se
d
of
m
er
ch
an
ts
an
d
pr
op
er
ty
ow
ne
rs
on
5t
h
av
en
ue
,
M
ad
is
on
av
en
ut
:',
P
ar
k
av
en
ue
,
an
ti
th
ei
r
co
nt
ig
uo
us
st
re
et
s.
Th
P.
ar
ea
co
ve
re
d
by
M
r.
:M
cC
ar
th
y'
s
as
so
ci
at
io
n
is
on
e
se
ri
ou
sl
y
af
fe
ct
ed
,
so
be
te
st
if
ie
d,
by
t.h
e
cr
ui
si
ng
of
t.a
xi
ca
bs
on
th
e
pr
in
ci
pa
l
t
h
o
r
o
u
~
h
f
a
r
e
s
w
hi
ch
pa
ss
th
ro
ug
h
it
.
A
ft
er
fiv
e
y
ea
rs
'
st
ud
y
of
th
e
ta
xi
ca
h
pr
ob
le
m
,
M
r.
M
cC
ar
th
y
te
st
if
ie
d
as
fo
ll
ow
s:
"W
e
ha
ve
al
w
ay
.,
he
ld
th
at
th
er
e
sh
ou
ld
be
a
de
fi
ni
te
li
m
it
at
io
n
in
th
e
nu
m
be
r
of
ta
xi
ca
bs
in
th
e
ci
tj
'
of
N
ew
Y
or
k.
A
s
to
w
ha
t
th
at
li
m
it
at
io
n
sh
ou
ld
be
,
w
e
fe
el
it
is
di
ff
ic
ul
t
to
de
te
rm
in
e
in
th
e
ab
se
nc
e
of
an
y
of
fi
ci
al
bo
dy
in
th
e
ci
t)
·
t.h
at
ca
n
m
ak
e
a
pr
op
er
an
d
ba
si
c
in
ve
st
ig
at
io
n,
t.h
at
sh
ou
ld
be
m
ad
e,
an
d
th
en
de
te
rm
in
e
as
sc
ie
nt
if
ic
al
ly
as
po
ss
ib
le
,
ti
ll
'
nn
m
l)
er
of
ta
xi
ca
bs
th
at
ar
e
ne
ed
ed
to
ac
co
m
m
od
at
e
th
e
ci
ti
-
ze
ns
of
ou
r
ci
t.y
.
T
he
co
nc
lu
si
on
s
of
th
e
co
m
m
it
te
e
w
er
e
a
l
o
n
~
th
es
e
li
ne
s:
T
he
y
sa
y
ta
xi
ca
b
op
er
at
io
n
ca
n
he
di
vi
de
d
in
to
tw
o
fa
ct
or
s;
on
e
ha
s
to
do
w
it
h
th
e
de
te
rm
in
at
io
n
of
th
e
fi
na
n-
ci
al
re
sp
on
si
bi
li
ty
of
yo
ur
op
er
at
or
or
op
er
at
or
s.
T
he
ot
he
r
a
de
te
nn
in
at
io
n
of
th
e
sa
fe
ty
fe
at
ur
es
,
a
d(
\te
rm
in
at
.io
n
of
th
e
nu
m
be
r
of
ca
bs
th
at
sh
ou
ld
be
op
er
at
ed
.
a
de
te
rm
in
at
.io
n
of
th
e
ge
ne
ra
l
or
ga
ni
za
ti
on
an
d
co
nt
ro
l
of
y
o
u
r
t.a
xi
ca
b
in
du
st
ry
,
an
d
th
e
se
co
nd
is
th
e
m
at
te
r
of
th
e
ac
tu
al
co
nt
ro
l
of
ou
r
ci
tv
st
re
et
s,
th
at
is
th
e
co
nt
ro
l
of
th
e
ta
xi
ca
b
on
cc
it
ge
ts
on
th
e
ci
t;
,
st
re
et
s.
"
.J
am
es
W
.
D
an
ah
y,
S
ec
re
ta
ry
of
th
e
W
es
t
S
id
e
A
ss
oc
ia
ti
on
of
C
om
m
er
ce
,
w
as
a
w
it
ne
ss
be
fo
re
y
o
u
r
co
m
m
it
te
e
an
d
te
st
if
ie
d
th
at
:
"
In
"i
ew
of
th
e
fa
ct
th
at
re
gu
la
ti
on
in
ot
he
r
fo
rm
s
of
tr
an
sp
or
ta
ti
on
is
in
th
e
ha
nd
s
of
th
e
T
ra
ns
it
C
om
m
is
si
on
,
it
se
em
s
lo
gi
ca
l
to
us
th
at
th
at
w
as
th
e
bo
dy
w
hi
ch
sh
ou
ld
ha
ve
th
e
ju
ri
sd
ic
ti
on
of
re
gu
la
ti
on
an
d
co
nt
ro
l
of
th
e
ta
xi
ca
b
in
du
st
ry
."
ADD58
26
D
is
tr
ic
t
o
f
C
o
l1
lm
b
in
:
T
he
P
ub
li
c
U
t.i
li
ti
es
C
om
m
is
si
on
is
em
po
w
-
er
ed
,
in
re
l'p
ec
t
of
ta
xi
ca
b
op
er
at
io
ns
in
it
s
di
st
ri
ct
,
tQ
re
q
u
ir
e:
(l
)
E
ac
h
ta
xi
ca
b
op
er
at
or
to
ob
ta
in
w
ri
tt
en
au
th
o
ri
ty
fr
om
th
e
c
o
m
m
i
~
<
;
i
o
n
to
op
er
at
e
ta
xi
ca
b;
(2
)
a
se
he
tl
nl
e
of
ra
te
s
to
be
fi
le
d
w
it
h
an
d
ap
pr
ov
ed
by
th
e
co
m
m
is
si
on
;
(3
)
al
l
ac
ci
de
nt
'l
re
l'u
lt
in
g
in
pe
rs
on
al
in
ju
ry
to
be
re
po
rt
ed
to
it
.
P
ub
li
c
li
ab
il
it
y
in
su
ra
nc
e
or
in
de
m
ni
ty
bo
nd
to
be
fu
rn
is
he
d,
o
r
pr
oo
f
of
fi
na
ll
ci
al
ab
il
it
y
to
p
ay
al
l
da
m
ag
es
re
su
lt
in
g
fr
om
ac
ci
de
nt
.,;
to
be
fil
l.'
d
w
it
h
it
;
(4
)
al
l
ta
xi
ca
bs
to
be
eq
ui
pp
ed
w
it·
h
ta
xi
m
et
er
s
te
st
ed
an
d
ap
pr
ov
ed
by
it
;
(5
)
o
p
er
at
in
g
re
co
rd
s
to
be
su
bm
it
te
d
to
it
.
M
a
ry
la
n
d
:
T
he
P
ub
li
c
S
er
vi
cc
C
or
nm
is
<;
io
n
is
em
po
w
er
ed
,
in
re
sp
ec
t
of
t:1
xi
ca
b
op
er
1l
tin
n
in
it
s
;;t
ilt
e,
to
:
(1
)
G
rC
ln
t.
re
f.
us
e
to
gr
an
t.
an
d
re
vo
kc
ce
rt
if
ic
at
es
of
co
n·
ve
ni
cn
ce
,11
1(1
np
cl
'&
<;
ity
;
(2
)
sp
ec
if
y
th
e
am
ou
nt
of
li
ab
il
it
y
in
su
ra
nc
c
or
in
de
m
ni
ty
bo
nd
to
be
ca
rr
ie
d
by
ta
xi
ca
b
co
m
pa
ni
es
;
(3
)
pr
e.
'lc
ri
bc
ne
ce
ss
ar
y
ru
lc
s
au
d
re
gu
la
ti
on
s
go
ve
rn
in
g
th
e
('
on
tr
ol
an
d
op
pr
at
io
n
of
ta
xi
ca
bs
.
T
he
la
w
o
f
th
is
st
nt
e
el
im
in
at
es
th
e
d
ri
v
er
re
nt
al
,
fl
at
ra
te
an
d
zo
ne
ra
te
sy
st
em
s
b
u
t
pr
ov
id
e
th
at
(a
)
ta
xi
ca
bs
to
bc
op
er
at
ed
on
ly
by
th
e
ow
ne
r
o
r
an
em
pl
oy
ee
th
er
eo
f;
(b
)
an
ta
xi
ca
bs
to
be
eq
ui
pp
ed
w
it
h
a
ta
xi
m
et
er
w
hi
ch
sh
al
l
be
ll
se
d
as
th
c
on
ly
m
ea
ns
of
m
ea
su
ri
ng
th
e
ch
ar
ge
fo
r
ta
xi
ca
b
sp
rv
ic
e.
llf
o
n
ta
n
a
:
T
he
R
:1
ilr
oa
d
C
O
lll
l1
lis
si
o n
is
el
llp
ow
el
"e
d,
in
re
sp
ec
t
of
ta
xi
ca
b
op
er
at
io
ns
in
itR
st
at
e,
to
:
(1
)
G
ra
nt
,
re
fu
sc
t.o
g
ra
n
t
an
d
re
yo
kc
ce
rt
if
ic
at
es
of
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y
j
(2
)
fix
th
e
ra
t.e
of
fa
re
;
(3
)
re
gu
la
te
th
e
se
rv
ic
e
an
d
sa
fe
ty
of
o
p
er
at
io
n
;
(4
)
re
qu
ir
e
th
e
fi
li
ng
o
f
an
nu
al
an
d
ot
he
r
re
p
o
rt
s;
(5
)
re
qu
ir
e
th
e
ca
rr
y
in
g
of
li
ab
il
it
·y
in
su
ra
nc
e
o
r
t.h
e
fil
in
J1
;
of
a
bo
nd
or
ne
go
ti
ab
le
se
cu
ri
ti
es
to
in
de
m
ni
fy
th
e
pu
bl
ic
in
ca
se
of
ac
ci
d
en
t;
(6
)
pr
es
cr
ih
e
ne
c(
>s
,'l
ar
y
m
le
s
an
d
re
gu
la
ti
on
s.
P
e
n
n
sy
lv
a
n
ia
:
T
he
Pu
bl
iC
'
S
en
'i
ce
C
om
m
is
.',
;jo
n
is
em
po
w
er
ed
,
in
re
sp
ec
t
of
t.a
xi
ca
b
op
er
at
io
ns
in
it
s
st
at
e,
to
:
(l
)
G
ra
nt
,
rc
fu
s(
>
to
~
r
a
n
t
an
d
re
yo
ke
ce
rt
if
ic
at
es
of
co
n-
ve
ni
en
ce
aJ
ld
n(
>c
es
si
ty
;
27
(2
)
fix
th
e
ra
te
of
fn
re
;
(3
)
re
gn
la
te
th
e
se
rv
ic
e
an
d
sa
fe
ty
of
op
er
at
io
n;
(4
)
re
qu
ir
e
th
e
fi
li
ng
of
re
po
rt
s
an
d
ot
he
r
d
at
a;
(5
)
re
qu
ir
e
th
e
ca
rr
y
in
g
of
pu
bl
ic
li
ab
il
it
y
in
su
ra
nc
e
or
th
e
m
ai
nt
l.'
na
nc
e
of
an
in
de
m
ni
ty
fu
n
d
on
sn
ch
te
rm
s
an
d
co
nu
i.
ti
on
s
as
m
ay
be
fi
xe
d
by
th
e
co
m
m
is
si
on
;
(6
)
m
ak
e
ne
ce
ss
ar
y
ru
le
s
em
d
re
gu
la
ti
on
s.
R
ho
de
Is
T
an
d:
T
he
P
ub
li
c
U
ti
li
ti
es
C
om
m
is
si
un
is
em
po
w
er
ed
,
in
re
sp
ec
t
of
ta
xi
ca
b
op
er
at
io
ns
iu
it
s
st
at
e,
to
:
(1
)
G
ra
nt
,
re
fu
se
to
g
ra
n
t
an
d
re
vo
ke
l'c
rt
if
ic
at
es
(If
co
n-
v(
>n
ie
nc
e
an
d
ne
ce
ss
it
y;
(2
)
pl
'e
sc
ri
be
m
ax
im
um
ra
te
s
of
fa
re
;
(3
)
re
gu
la
te
th
e
ch
ar
ac
tN
of
se
rv
ic
e;
(4
)
r(
>q
ui
re
th
e
ca
rr
y
in
g
of
pu
bl
ic
li
ab
il
it
y
in
su
ra
nc
e;
(:
1)
pr
es
cr
ib
e
ne
ce
ss
ar
y
ru
le
s
an
d
re
gu
la
ti
on
s.
l'/
fS
t
V
ir
g
in
ia
:
T
he
S
ta
te
R
oa
d
C
om
m
is
si
on
is
pm
po
w
el
'e
u,
in
re
sp
ec
t
of
ta
xi
ca
b
op
er
at
io
ns
in
it
s
st
at
e,
to
:
(1
)
G
ra
nt
,
re
fu
se
to
gr
cl
llt
.
an
d
re
yo
ke
eP
l·t
iti
cn
te
R
of
pn
bl
ic
co
nv
(>
ni
en
ce
an
d
n(
>c
es
si
ty
;
(2
)
re
qu
ir
e
th
e
ca
rr
y
in
g
o
f
pu
bl
ic
li
ab
il
it
y
in
su
ra
nc
e
in
su
ch
am
ou
nt
s
as
m
ay
be
fi
xe
d
by
it
.
(3
)
pr
es
cr
ib
e
ne
ce
ss
ar
y
ru
le
s
an
d
re
gu
la
ti
on
s.
C
O
N
C
L
U
SI
O
N
S
'l'h
(>
re
co
ru
m
ad
e
by
yo
ur
co
m
m
it
te
e.
an
d
it
s
st
ud
y
of
ex
pe
ri
-
('
1
1
C
(>
8
in
ot
he
r
st
at
es
,
an
d
a
co
m
pa
ri
so
n
w
it
h
th
..
sa
m
e,
le
d
yo
ur
cO
lll
m
itt
ee
tQ
th
e
fo
ll
ow
in
g
co
nc
lu
si
on
s:
1.
T
h
at
th
e
nu
m
be
r
of
ta
xi
ca
bs
li
ce
ns
eu
fo
r
op
er
at
io
11
on
J/
ln
u-
ar
y
1,
19
36
,
is
am
pl
e,
su
ff
ic
ie
nt
an
d
ad
eq
ua
te
to
sa
ti
sf
y
th
e
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
cC
l's
ity
in
th
e
ci
ty
of
N
(>
w
Y
or
k
an
d
sh
ou
ld
no
t
be
in
cr
ea
se
d,
o
r
p(
>
rm
it
te
d
to
be
in
cr
ea
se
d,
ul
lt
il
af
t1
O
'r
pr
oo
f
th
at
th
e
pu
bl
ic
co
nv
en
ie
nc
e
fin
d
ne
ce
ss
it
y
re
qn
ir
t>
in
cr
ea
se
ill
sn
ch
nu
m
be
r.
2.
T
h
at
al
l
pe
rs
on
s
le
ga
ll
y
en
ga
ge
d
in
th
e
bu
si
n(
>M
of
op
er
at
in
g
ta
xi
ca
bs
sh
ou
ld
be
au
th
or
iz
ed
to
co
nt
in
ue
in
sa
m
e
w
it
ho
ut
pr
oo
f
on
th
ei
r
p
ar
t
th
at
th
(>
pu
bl
ic
co
nv
(>
ni
en
ce
an
d
IH
'c
cs
si
ty
w
ill
be
sl
lb
se
rv
ed
by
th
ei
r
co
nt
in
ue
d
op
er
at
io
n.
3.
'f
ha
t.
su
pe
rv
is
or
y
an
d
re
gu
la
to
Q
'
po
w
er
s
be
ve
st
ed
in
th
e
D
ep
ar
tm
(>
nt
of
P
ub
li
c
S
er
vi
ce
w
it
h
po
w
er
to
gr
nn
t,
r(
>f
us
e
to
g
ra
n
t
lI
nu
re
vo
ke
ce
rt
if
ic
at
(>
s
o
f
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
."
''li
ty
,
an
d
to
m
ak
e
al
l
ne
ce
ss
ar
y
ru
le
s
an
d
re
gu
la
ti
on
s
fo
r
th
e
ef
fe
ct
iv
e
en
fo
rc
em
en
t
of
th
e
pr
ov
is
io
ns
of
la
w
he
re
in
af
te
r
su
gg
es
te
d.
4.
T
h
at
th
e
co
m
m
is
si
on
hi
'
em
po
w
er
ed
to
de
te
rm
in
e
w
he
th
er
th
e
pu
bl
ic
co
nv
en
i(
>n
ce
an
d
ne
ce
ss
it
y
w
ill
be
su
bs
er
ve
d
by
th
e
op
er
a·
ti
on
of
ad
di
ti
on
al
ta
xi
ca
bs
fo
r
w
hi
ch
llf
'W
ap
pl
ic
at
io
ns
m
ay
be
m
ad
e.
ADD59
S
ec
ti
on
16
0.
16
1.
16
2.
48
55
.
A
ne
w
or
di
na
nc
e
sh
ou
ld
be
pa
ss
ed
ef
fe
ct
ua
ti
ng
th
e
pr
in
-
ci
pl
es
se
t
fo
rt
h
in
pr
ec
ed
in
g
re
co
m
m
en
da
ti
on
s
as
w
el
l
as
th
e
pr
es
en
t
pr
in
ci
pl
e.
~
of
re
gu
la
ti
on
w
hi
ch
nr
e
co
ns
is
te
nt
th
er
ew
it
h.
T
hi
s
or
di
na
nc
e
sh
ou
ld
de
al
on
ly
w
it
h
fu
nd
am
en
ta
l
m
at
te
rs
of
po
lic
y
w
hi
ch
m
us
t'
ne
ce
ss
ar
il
y
be
de
cl
ar
ed
.
by
th
e
le
gi
sl
at
iv
e
bo
dy
.
A
ll
ot
he
r
m
at
te
rs
of
de
ta
il
ed
re
gu
la
ti
on
sh
ou
ld
be
co
nf
id
ed
to
th
e
ju
ri
sd
ic
ti
on
of
th
e
H
ac
k
B
ur
ea
u
as
th
e
ad
m
in
is
tr
at
iv
e
ag
en
cy
an
d
it
sh
ou
ld
pr
ep
ar
e
a
co
de
of
ru
le
s
an
d
re
gu
la
ti
on
s
to
su
pp
le
-
m
en
t
th
e
or
di
na
nc
e.
56
.
R
ec
om
m
en
d.
at
io
ns
fo
r
ad
m
in
is
tr
at
iv
e
ch
an
ge
s
w
hi
ch
ar
e
w
it
hi
n
th
e
po
w
er
of
th
e
H
ac
k
B
ur
ea
u
un
de
r
th
e
pr
es
en
t
or
di
na
nc
e
sh
ou
ld
be
ef
fe
ct
ed
im
m
ed
ia
te
ly
,
an
d
a
co
de
of
ru
le
s
an
d
re
gu
la
ti
om
;
pr
ep
ar
ed
fo
r
us
e
be
tw
ee
n
th
e
pr
es
en
t
ti
m
e
an
d
th
e
ti
m
e
w
he
n
th
e
ne
w
or
di
na
nc
e
m
ay
be
pa
ss
ed
.
49
E
X
m
B
IT
E
P
ro
p
o8
ed
B
il
l
B
y
M
R
.
E
D
W
A
R
D
S.
M
O
R
A
N
,
JR
.
A
N
A
C
T
to
am
en
d
th
e
pu
bl
ic
se
rv
ic
e
la
w
,
In
re
la
ti
on
to
th
e
op
er
at
io
n
of
tu
lc
a
b
s
In
ce
rt
ai
n
ci
ti
es
an
d
pr
ov
ld
ll
g
lo
r
th
e
re
gl
li
ll
ti
on
th
er
e<
>f
T
he
P
eo
pl
e
o
f
th
e
St
at
e
o
f
N
ew
Y
or
k,
re
pr
es
en
te
d
in
Se
na
te
an
d
A
ss
em
bl
y,
do
en
ac
t
as
fo
ll
ow
s:
S
ec
ti
on
1.
C
ha
pt
er
fo
ur
hu
nd
re
d
an
d
ei
gh
ty
of
th
e
la
w
s
of
ni
ne
te
en
hu
nd
re
d
te
n,
la
st
re
-e
nt
it
le
d
by
ch
ap
te
r
se
ve
n
hu
nd
re
d
an
d
ei
gh
ty
-t
w
o
of
th
e
la
w
s
of
ni
ne
te
en
hu
nd
re
d
th
ir
ty
,
"A
n
ac
t
re
la
ti
ng
to
th
e
pu
bl
ic
se
rv
ic
e
of
ut
il
it
y
co
m
pa
ni
es
,
co
ns
ti
tu
ti
ng
ch
ap
te
r
fo
rt
Y
-e
ig
ht
of
th
e
co
ns
ol
id
at
ed
la
w
s,
"
is
he
re
by
am
en
de
d
by
in
se
rt
in
g
th
er
ei
n
a
ne
w
ar
ti
cl
e,
to
be
ar
ti
cl
e
te
n,
to
re
ad
as
fo
ll
ow
s:
.
A
R
T
IC
L
E
10
P
R
O
V
IS
IO
N
S
R
E
L
A
T
IN
G
T
()
T
A
X
IC
A
B
S
,
T
A
X
IC
A
B
S
E
R
V
IC
E
A
N
D
T
A
X
IC
A
B
O
P
E
R
A
T
O
R
S
A
pp
li
ca
ti
on
of
ar
ti
cl
e;
de
fi
ni
tio
ns
.
Ju
ri
sd
ic
ti
on
of
co
m
m
is
si
on
.
G
en
er
al
po
w
er
s
of
th
e
co
m
m
is
si
on
s
in
re
sp
ec
t
to
ta
xi
ca
b
se
rv
ic
e
an
d
ta
xi
ca
b
op
er
at
or
s.
16
3.
C
er
ti
fi
ca
te
of
co
m
m
is
si
on
to
be
di
sp
la
ye
d
on
ta
xi
-
ca
bs
;
ta
xi
m
et
er
s.
16
4.
P
ow
er
of
th
e
co
m
m
is
si
on
to
is
su
e
ce
rt
if
ie
at
es
of
pu
bl
ic
co
nv
en
ie
ne
e
an
d
ne
ce
ss
ity
.
16
4-
a.
B
on
ds
,
po
lic
ie
s,
su
rp
lu
s.
16
4-
b.
In
sp
ec
ti
on
of
ta
xi
ca
bs
.
16
5.
P
ay
m
en
ts
by
op
er
at
or
s
to
ci
ti
es
.
16
6.
R
at
es
to
be
fix
ed
b
y
't
he
co
m
m
is
si
on
.
16
6-
a.
D
es
ig
na
ti
on
of
ha
ck
st
an
ds
.
16
7.
R
ep
ea
l
of
co
nf
li
ct
in
g
la
w
s.
16
8.
S
av
in
g
cl
au
se
.
§
16
0.
A
pp
li
ca
ti
on
of
ar
ti
cl
e;
de
fi
ni
ti
on
s.
1.
T
hi
s
ar
ti
cl
e
sh
al
l
ap
pl
y
to
ta
xi
ca
bs
.
ta
xi
ca
b
se
rv
ic
e
an
d
to
ta
xi
ca
b
op
er
at
or
s
as
he
re
in
af
te
r
de
fi
ne
d
w
it
hi
n
th
e
ju
ri
sd
ie
ti
on
he
re
in
af
te
r
co
nf
er
re
d
up
on
th
e
pu
bl
ic
se
rv
ic
e
co
m
m
is
si
on
an
d
up
on
th
e
tr
an
si
t
co
m
-
m
is
si
on
.
2.
W
he
ne
ve
r
us
ed
in
th
is
ar
ti
cl
e,
"t
ax
ic
ab
"
m
ea
ns
a
m
ot
or
pr
op
el
le
d
ve
hi
cl
e
th
e
ow
ne
r
of
w
hi
ch
is
re
qu
ir
ed
to
co
m
pl
y
w
it
h
se
ct
io
n
se
ve
nt
ee
n
of
th
e
ve
hi
cl
e
an
d
tr
af
fi
c
la
w
,
ot
he
r
th
an
an
om
ni
bu
s,
o
r
a
ve
hi
cl
e
op
er
at
ed
o.n
ra
il
s,
or
a
ve
hi
cl
e
re
nt
ed
so
le
ly
by
th
e
ho
ur
an
d
no
t
en
ga
ge
d
m
ca
rr
ym
g
or
tr
an
sp
or
ti
ng
pa
s-
se
ng
er
s
fo
r
hi
re
,
w
hi
ch
sa
id
m
ot
or
pr
op
el
le
d
ve
hi
cl
e
is
us
ed
an
d
ADD60
50
dr
iv
en
by
th
e
ow
ne
r
th
el
'c
of
or
a
pe
rs
ol
l
in
sn
eh
ow
nE
'I"
s
em
pl
oy
fo
r
th
e
ca
rr
y
in
g
an
d
tr
an
sp
or
ti
ng
of
pa
.,
>~
en
ge
rs
fo
r
hi
re
in
ci
ti
es
,
no
t
on
a
fi
xe
d
ro
nt
e,
an
d
re
ce
iv
in
g
a
fa
re
ca
lc
ul
at
ed
,
co
m
pn
te
d
an
d
re
co
rd
ed
by
a
ta
xi
m
et
er
.
3.
W
he
ne
ve
r
us
ed
in
th
is
ar
ti
cl
e,
"t
ax
im
et
er
"
m
ea
ns
a
m
er
ha
n-
ic
al
in
st
ru
m
en
t.
or
de
vi
ce
ap
pr
ov
ed
by
th
e
co
m
m
is
si
on
by
w
hi
ch
th
e
ch
ar
ge
fo
r
hi
re
of
a
ta
xi
ca
b
is
m
ec
ha
ni
ca
ll
y
ca
lC
lll
at
ei
l,
ei
th
er
fo
r
di
st
an
ce
tr
av
el
le
d
or
fo
r
w
ai
ti
ng
ti
m
e.
or
fo
r
bo
th
,
an
d
up
on
w
hi
ch
sn
ch
ch
ar
ge
sh
al
l
be
cl
ea
rl
Y
in
di
ca
te
d.
4.
W
he
ne
ve
r
us
ed
in
th
is
ar
ti
cl
e,
"t
ax
ic
ab
se
rv
ic
e"
m
ea
ns
th
c
em
pl
oy
m
en
t
of
a
m
ot
or
ve
hi
cl
e
or
m
ot
or
ve
hi
cl
es
he
rc
in
ab
ov
e
de
fi
ne
d
in
su
bd
iv
is
io
n
tw
o
he
re
of
fo
r
th
e
ca
rr
ia
ge
of
th
e
pu
bl
ic
fo
r
hi
re
.
5.
W
he
nc
ve
r
us
ed
in
th
is
ar
ti
cl
e,
th
e
tp
rm
I
I
ta
xi
ra
b
Q
pe
ra
to
r"
sh
al
l
m
ea
n
ev
er
y
co
rp
Q
ra
ti
on
,
co
m
pa
ny
.
a8
-'i
oc
ill
tio
n,
jo
in
t
st
or
k
as
so
ci
at
io
n,
p
ar
tn
er
sh
ip
an
d
pe
rs
on
,
th
ei
r
le
'is
ee
s,
tru
st
ee
.<
;
or
re
ce
iv
er
s
ll,
pp
oi
nt
ed
by
an
y
co
ur
t
w
ha
ts
oe
ve
r,
ow
ni
ng
.
ie
-a
si
ng
nr
op
er
at
in
g
or
pr
op
os
in
g
to
ow
n,
le
as
e
or
op
er
at
e
ta
xi
ca
b
o
r
ta
xi
ca
bs
or
ta
xi
ca
b
se
rv
ic
e.
6.
W
he
ne
ve
r
ns
ed
in
th
is
ar
ti
cl
e,
th
e
te
rm
"c
er
ti
fi
ca
te
"
sh
al
l
m
ea
n
ce
rt
if
ic
at
e
of
co
nv
en
ie
nc
e
an
d
ne
ce
s.<
;it
y
is
su
ed
by
th
e
('
O
ll
l-
m
is
si
on
au
th
or
iz
in
g
th
e
ta
xi
ca
b
op
er
at
or
.
as
he
re
in
be
fo
re
de
fi
ne
d
in
su
bd
iv
is
io
n
fiv
e
he
re
of
,
to
op
er
at
e
ta
xi
ca
bs
in
ci
ti
es
.
7.
W
he
ne
ve
r
w
;c
d
in
th
is
ar
ti
cl
e,
th
e
te
rm
"c
o
m
m
is
si
o
n
"
sh
al
l
m
ea
n
th
e
tr
an
si
t
co
m
m
is
si
on
ha
vi
ng
ju
ri
sd
ic
ti
on
liS
he
re
in
pr
ov
id
ed
.
8.
W
he
ne
ve
r
ns
eJ
in
th
is
ar
ti
d
e,
th
e
te
rm
"
<
lr
iv
er
"
sh
al
l
m
en
n
R
lld
in
cl
ud
e
an
y
pe
rs
on
li
ce
ns
ed
to
op
er
at
t'
It
m
ot
or
ve
hi
cl
e
R
nd
hf
Jl
di
ng
a
ha
ck
li
ce
ns
e
an
th
or
iz
in
g
op
er
at
io
n
of
a
ta
xi
ca
b.
9.
W
he
ne
ve
r
us
ed
in
th
is
ar
ti
cl
e,
th
e
te
rm
"t
ax
ic
ab
st
R
ll
d"
sh
al
l
m
en
n
lin
d
in
cl
ud
e
th
e
sp
ac
e
re
se
rv
ed
np
on
th
e
st
re
et
s,
hi
gh
-
w
ay
s
an
d
pu
bl
ic
pl
ac
es
of
a
ci
ty
fo
r
th
e
ns
e
of
ta
xi
ca
bs
so
li
ci
ti
nq
an
d
aw
ai
ti
ng
hi
re
.
10
.
W
he
ne
ve
r
ll.
'if
'd
in
th
is
ar
ti
cl
e,
th
e
te
rm
"g
l'O
S
S
in
c0
11
1(
,"
sh
ill
!
m
ea
n
th
e
re
vl
'1J
11
1'
de
ri
ve
d
fr
fJ
m
pl
ls
se
ng
er
fa
re
s
w
it
ho
ut
de
du
ct
io
n
of
an
y
ki
nd
.
§
16
1.
Ju
ri
sd
ic
ti
o
n
of
co
m
m
is
si
on
.
T
he
ju
ri
sd
ic
H
on
.
sl
l]
1e
rv
i-
fii
fJ
n,
po
w
er
s
an
d
du
ti
es
of
th
e
co
m
m
is
si
on
,
in
ad
di
ti
on
to
th
os
e
el
se
w
he
re
co
nf
er
re
d
sh
al
l
t'x
te
nd
to
an
d
in
cl
ud
e
ta
xi
ca
bs
,
ta
xi
ca
h
se
.n
-i
ce
an
d
ta
xi
ca
b
op
er
ll
to
rs
op
er
at
in
g
w
ho
lly
or
in
pa
rt
.
in
ci
ti
es
w
it
h
a
po
pu
la
ti
on
of
on
e
m
il
li
on
or
m
or
e.
§
16
2.
G
en
er
al
po
w
er
s
of
th
e
co
m
m
is
si
nn
in
re
sp
ec
t
to
ta
xi
ca
11
se
rv
ic
e
an
d
ta
xi
ca
b
op
er
at
or
s.
T
he
co
m
m
is
si
on
!O
ha
ll
ha
vp
po
w
er
to
de
te
rm
in
e
an
d
fix
fr
om
ti
m
e
to
ti
m
e
th
e
nu
m
be
r
of
ta
xi
-
el
lb
s
to
be
op
er
at
ed
w
it
hi
n
an
y
ci
ty
w
it
hi
n
it
s
ju
ri
sd
ic
ti
on
an
d
l'h
al
l
ha
ve
lin
d
ex
er
ei
se
in
re
sp
ec
t
to
ta
xi
ca
b
se
rv
ic
t'
an
d
ta
xi
ca
h
op
er
at
or
s
al
l
th
e
po
w
er
s
co
nf
er
rt
'd
by
se
ct
io
ns
fo
rt
y-
fi
ve
.
fo
rt
y-
si
x.
fi
ft
y-
tw
o
lin
d
fi
ft
y-
se
ve
n
of
th
e
pu
bl
ic
sp
rv
ic
e
la
w
an
d
el
lc
h
ta
xi
ca
h
51
op
er
at
or
sh
al
l
co
m
pl
y
w
it
h
th
e
re
qu
ir
em
en
t.
,
of
sa
id
se
ct
io
ns
.
T
he
co
m
m
is
si
on
,
in
ad
di
ti
on
to
th
e
fo
re
go
in
g
po
w
er
s,
sh
ll
ll
ha
ve
an
d
ex
er
ci
se
in
re
sp
ec
t
to
ta
xi
ca
bs
,
ta
xi
ca
b
se
rv
ic
e
an
d
ta
xi
ca
b
op
er
-
at
or
s
th
e
po
w
er
t.o
fix
un
if
or
m
ra
te
s
of
fa
re
;
to
de
te
rm
in
e
th
e
fi
na
nc
ia
l
re
sp
on
si
bi
li
t.y
as
he
re
in
af
te
r
de
fi
ne
d
an
d
rt
'q
ui
re
d
of
an
y
pe
rs
on
or
co
rp
or
at
io
n
en
ga
ge
d
ill
th
e
op
er
R
tio
n
of
ta
xi
ca
bs
;
to
de
te
rm
in
e
th
e
bo
nd
,
po
li
ci
es
of
in
su
ra
nc
e,
su
ff
ic
ie
nc
y
of
re
se
rv
es
,
in
ca
se
of
se
H
-i
ns
ur
er
s
or
su
rp
lu
s
as
he
re
in
de
fi
ne
d,
or
be
fi
le
d
or
m
ai
nt
ai
ne
d
by
su
ch
pe
rs
on
s
or
co
rp
or
at
io
ns
an
d
th
e
am
ou
nt
s
an
d
co
nd
it
io
ns
th
er
eo
f;
to
de
te
rm
in
e
pr
io
r
ri
gh
ts
to
di
st
in
c-
ti
ve
ta
xi
ca
b
co
lo
r
sc
he
m
es
,
em
bl
em
s
an
d
m
ar
ki
ng
s
an
d
to
m
ak
e
Il
Ss
ig
nm
en
ts
th
er
eo
f
an
d
to
pr
ot
ec
t
op
er
at
or
s
in
th
ei
r
r
i
~
h
t
s
to
an
d
us
e
of
su
ch
di
st
in
ct
iv
e
ta
xi
ca
b
co
lo
r
sc
he
m
es
,
em
bl
em
s
un
d
m
ar
ki
ng
s;
to
m
ak
e
an
d
en
fo
rc
e
ru
le
s
an
d
re
gu
la
ti
on
s
co
n-
ce
rn
in
g
th
e
qu
al
if
ic
at
.io
ns
of
ta
xi
ca
b
dr
iv
er
s
an
d
to
pr
es
cr
ib
e
th
e
pe
ri
od
of
ac
ti
ve
se
rv
ic
e
in
ac
tu
al
ta
xi
ca
b
em
pl
oy
m
en
t
or
op
er
at
io
n
re
qu
ir
ed
d
u
ri
n
g
ea
ch
y
ea
r
as
a
pr
er
eq
ui
si
te
th
er
ef
or
;
to
pr
es
cr
ib
e
th
e
m
ax
im
um
nu
m
be
r
of
ho
ur
s
da
il
y
in
,
an
d
th
e
w
or
ki
ng
co
nd
it
io
ns
un
de
r.
w
hi
ch
ta
xi
ca
b
dr
iv
er
n
m
ay
e
n
g
a
~
e
in
ta
xi
ca
b
op
er
at
io
n;
to
di
re
ct
th
e
pr
oc
ur
em
en
t
an
d
m
ai
nt
en
an
ce
of
pr
op
er
w
or
km
en
's
co
m
pe
ns
at
io
n
in
su
ra
nc
e
by
al
l
op
er
at
or
s
em
pl
oy
in
g
ta
xi
ca
b
dr
iv
er
s
or
ot
he
rs
,
as
m
ay
be
re
qn
ir
ed
by
th
e
w
or
km
en
's
co
m
pe
ns
at
io
n
la
w
;
to
en
fo
rc
e
th
e
pa
ym
en
t
by
al
lY
ta
xi
ca
b
op
er
at
or
to
th
e
ci
ti
es
,
of
th
e
pe
rc
en
ta
ge
of
gr
os
s
ea
rn
in
gs
of
sn
eh
op
er
at
or
as
hl
'r
ei
n
pr
ov
id
ed
;
in
cl
ud
in
g
th
e
po
w
er
to
m
ltk
e
ru
le
s
an
d
re
gu
la
tio
llH
to
m
ak
e
ef
fe
ct
iv
e
th
e
du
ti
es
im
po
se
d
up
on
it
by
th
is
ch
ap
te
r.
§
16
.'3
.
C
er
ti
fi
ca
te
of
co
m
m
is
si
on
to
be
di
sp
la
ye
d
on
ta
xi
cl
,ib
s;
ta
xi
m
et
er
s.
O
n
or
af
te
r
S
ep
te
m
be
r
fi
rs
t.
ni
ne
te
en
hu
nd
re
d
th
ir
ty
-
~i
x,
11
0
ta
xi
ca
b
as
he
rt
'in
be
fo
re
de
sc
ri
be
d
sh
al
l
be
O
I
H
'
r
a
t
~
d
w
it
hi
n
a
ci
ty
w
it
h
a
po
pu
la
ti
on
of
on
e
m
ill
io
n'
or
m
or
e
un
le
ss
it
ca
rr
ie
s
pr
om
in
en
tl
y
di
sp
la
ye
d
th
er
eo
n
in
su
ch
m
an
ne
r
a'
i
th
e
co
m
m
is
si
on
lU
ay
pr
es
cr
ib
e
th
e
na
m
e
of
t.h
e
tr
u
e
ow
ne
r
th
er
eo
f,
th
e
le
ss
ee
or
op
er
at
or
an
d
a
ce
rt
if
ic
at
e
ev
id
en
ci
ng
th
at
th
e
co
m
m
is
si
on
ha
s
ce
rt
if
ie
d
in
ac
co
rd
an
ce
w
it
h
th
e
pr
ov
is
io
ns
of
th
is
ar
ti
cl
e
th
at
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y
re
qu
ir
e
th
e
op
er
at
io
n
of
su
ch
ta
xi
ca
b
an
d
th
at
th
e
op
er
at
or
ha
s
co
m
pl
ie
d
w
it
h
aU
of
th
e
re
qu
ir
e-
m
en
ts
of
th
is
ar
ti
cl
e
an
d
th
e
or
de
rs
of
th
e
co
m
m
is
si
on
is
su
ed
in
pu
rs
ua
nc
e
he
re
of
.
N
o
m
ot
or
ve
hi
cl
e
sh
al
l
be
li
ce
ns
ed
as
a
ta
xi
ca
b
un
le
ss
an
d
nn
ti
l
a
ee
rt
if
ic
at
t'
of
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y
sh
an
ha
ve
fi
rs
t
be
en
gr
an
te
d
th
er
ef
or
by
th
e
co
m
m
is
si
on
.
an
d
no
su
ch
li
ce
ns
e
sh
al
l
be
w
it
hh
el
d
or
de
ni
ed
af
te
r
th
e
gr
an
ti
ng
of
a
ce
rt
if
i-
ca
te
by
th
e
co
m
m
is
si
on
un
le
ss
su
ch
ve
hi
cl
e
sh
al
l
be
fo
un
d
to
be
un
sa
fe
or
to
vi
ol
at
e
an
y
re
gu
la
ti
on
s
no
t
in
co
nf
lic
t
w
it
h
th
e
pr
o-
vi
si
on
s
of
th
is
ar
ti
cl
e.
E
ve
ry
ta
xi
ca
b
fo
r
w
hi
ch
a
ce
rt
if
ic
at
e
of
pu
bl
ic
cO
llv
en
ie
nc
e
an
d
ne
ce
ss
it
y
is
re
qu
ir
eJ
fo
r
op
er
at
io
n
by
th
e
te
rm
s
of
th
is
ar
ti
cl
e
sh
al
l
be
eq
ui
pp
ed
w
it
h
a
ta
xi
m
et
er
as
he
re
in
ADD61
52
de
fi
ne
d,
fo
r
th
e
pu
rp
os
e
of
ca
lc
ul
at
in
g,
co
m
pu
ti
ng
,
re
co
rd
in
g
an
d
di
sp
la
yi
ng
th
e
fll
l'e
ll
po
n
th
e
ra
te
fi
xe
d
by
th
e
co
m
m
is
si
on
.
§
16
4.
P
ow
er
of
th
e
co
m
m
is
si
on
to
is
su
e
ce
rt
if
ic
at
es
of
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y.
1.
N
o
ta
xi
ca
b
op
er
at
or
sh
al
l
op
er
at
e
a
ta
xi
ca
b
or
ta
xi
ca
b
se
rv
ic
e
w
it
ho
ut
th
e
pl
'rm
is
si
on
nn
d
ap
pr
ov
al
of
t·h
e
co
m
m
is
si
on
an
d
it
s
ce
rt
if
ic
at
e
af
te
r
a
he
ar
in
g
ha
d
up
on
no
tic
e.
A
n
y
pe
rs
on
,
fi
rm
or
co
rp
or
ll
ti
on
an
d
th
e
a~
el
lt
s,
S
l'r
va
nt
s
an
d
em
pl
oy
el
'S
of
an
y
pe
rs
on
,
fi
rm
or
co
rp
or
at
io
n
op
er
at
in
g
an
y
ta
xi
ca
b
ur
ta
xi
ca
b
se
rv
ic
e
as
th
e
sa
m
e
is
de
fi
ne
d
in
th
is
ar
ti
cl
e
w
it
ho
ut
ha
vi
ng
ob
ta
in
ed
th
e
ce
rt
if
ir
at
e
as
pr
ov
id
l'd
in
th
is
ar
ti
cl
e,
sh
al
l
be
gu
il
ty
of
a
m
is
de
m
ea
no
r.
N
ot
ic
e
of
su
ch
hN
lr
in
g
sh
al
l
ue
gi
ve
n
to
th
e
M
ay
or
of
th
e
ci
ty
in
w
hi
ch
it
is
pr
op
os
ed
to
op
er
at
e
su
ch
ta
xi
ca
b
se
rv
ic
e
an
d
to
ot
he
r
pe
rs
on
s
or
c0
1'
po
ra
tio
llS
de
em
ed
by
th
e
co
m
m
is
si
on
to
be
in
te
re
st
ed
in
th
e
pr
oc
ee
di
ng
.
2.
N
o
ce
rt
if
ic
at
e
sh
al
l
be
is
.'m
ed
un
ti
l
8
.
th
e
ap
pl
ic
an
t
th
er
ef
or
sh
al
l
ha
ve
fi
le
d
in
th
e
of
fic
e
of
t
h
~
co
m
-
m
is
si
on
II
ve
ri
fi
ed
st
at
em
en
t
in
w
ri
ti
ng
sh
ow
in
g
hi
s
or
it
s
tr
ll
e
fi
na
n-
ti
al
co
nd
it
io
n
on
th
e
da
te
of
th
e
ap
pl
ic
at
io
n
an
d
th
at
he
'o
r
it
ha
s
fu
ll
y
co
m
pl
ie
d
w
it
h
al
l
th
e
pr
ov
is
io
ns
of
ar
ti
el
e
si
x-
a
of
th
e
ve
hi
cl
e
aH
d
tr
af
fi
c
la
w
;
b.
it
sh
al
l
ap
pe
ar
th
at
th
e
ap
pl
ic
an
t
ha
s
pr
oc
ur
ed
th
e
bo
nd
or
pO
lic
y
of
in
su
ra
nc
e
or
es
ta
bl
is
he
d
th
e
su
rp
lu
s
as
he
re
in
re
qu
ir
ed
or
m
ai
nt
ai
ns
a
fu
n
d
as
a
se
lf
-i
ns
ur
er
as
he
re
in
af
te
r
se
t
fo
rt
h
;
c.
th
e
ap
pl
ic
an
t
sh
al
l
ha
ve
sh
ow
n
th
at
pu
bl
ic
co
nv
en
ie
nc
e
an
d
n{
lc
es
si
ty
re
qu
ir
e
th
e
op
er
at
io
n
of
ea
ch
su
ch
ta
xi
ca
b
pr
op
os
ed
to
be
op
er
at
ed
;
pr
ov
id
ed
,
ho
w
ev
er
,
th
at
ev
er
y
ta
xi
ca
b
op
er
at
or
le
l'!
'a
lly
eJ
ig
ag
eu
in
ta
xi
ca
b
op
er
at
io
ns
on
th
e
da
te
w
he
n
th
is
ar
ti
cl
e
ta
ke
s
ef
fe
ct
sh
al
l
no
t
be
re
qu
ir
ed
to
sh
ow
th
at
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y
re
qu
ir
e
th
e
op
er
at
io
n
of
th
e
ta
xi
ca
b
or
ta
xi
ca
hs
ae
tu
al
ly
ill
op
er
at
in
g
us
e
by
su
ch
op
er
at
or
on
su
ch
d
at
e;
d.
th
e
ap
pl
ic
an
t
sh
al
l
ha
ve
pa
id
to
th
e
co
m
m
is
si
on
a
fe
e
of
fiv
e
do
ll
ar
s
fo
r
ea
ch
ta
xi
ca
b
pr
op
os
ed
to
be
op
er
at
ed
.
3.
S
uc
h
ce
rt
if
ic
at
e
sh
al
l
ap
p
ly
to
an
d
va
li
da
te
th
e
op
er
at
io
n
on
ly
of
th
e
ta
xi
ca
b
or
ta
xi
ca
bs
sp
ec
if
ic
al
ly
de
sc
ri
be
d
th
er
ei
n;
sh
al
l
no
t
be
tr
an
sf
er
re
d
or
as
si
gn
ed
an
d
al
lY
tr
an
sf
er
or
as
si
gn
m
en
t
th
er
eo
f
by
th
e
ta
xi
ca
b
op
er
at
or
to
w
ho
m
or
w
hi
ch
th
e
sa
m
e
m
ay
be
is
su
ed
sh
al
l
be
vo
id
an
d
of
no
ef
l'l
'c
t
nn
le
ss
th
e
co
m
m
is
si
on
sh
al
l
ap
pr
ov
e
su
ch
tr
an
sf
er
or
as
si
gn
m
en
t
on
th
e
gr
ou
nr
l
th
at
th
e
pn
bl
ic
('o
n-
ve
ni
en
ce
an
u
ne
ce
ss
it
y
w
ar
ra
n
t
th
e
sa
m
e.
E
ar
h
su
eh
ce
rt
if
ic
at
e
of
pu
bl
ic
co
nv
en
ie
nc
e
an
d'
l1
ec
es
si
ty
sh
al
l
re
m
ai
n
in
fu
ll
fO
fc
e
an
d
ef
fe
ct
u
n
ti
l
re
vo
ke
d
or
su
sp
en
de
d
by
th
e
co
m
m
is
si
on
,
as
he
re
in
pr
uv
id
ed
.
4.
T
he
co
m
m
is
.,>
io
n
ei
th
er
up
on
co
m
pl
ai
nt
or
np
on
it
s
ow
n
m
ot
io
n
w
it
ho
ut
co
m
pl
ai
nt
b
u
t
up
on
re
as
on
ab
le
no
ti
re
an
d
fo
r
ca
ns
I'.
,
m
ay
re
vo
ke
or
su
sp
en
d
a
ce
rt
if
ic
at
e
of
pu
bl
ic
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y
th
er
et
of
or
e
is
su
ed
a.
fo
r
no
n-
co
m
pl
ia
nc
e
w
it
h
an
y
ru
le
OJ
'
re
gu
la
ti
on
pr
om
ul
ga
te
d
by
th
e
co
m
m
is
si
on
j
53
b.
fo
r
fa
il
ur
e
to
co
m
pl
y
w
it
h
an
or
de
r
of
th
e
co
m
m
is
si
on
la
w
fu
ll
y
m
ad
e
w
it
h
re
sp
ec
t
to
tl
le
ta
xi
ca
b
op
er
at
or
;
c.
fo
r
vi
ol
at
io
n
of
an
y
pr
ov
is
io
n
of
la
w
j
d.
fo
r
m
ak
in
g
an
y
fa
ls
e
st
at
em
en
t
in
.
or
in
su
pp
or
t
of
hi
s
or
it
s
ap
pl
ic
at
io
n
fo
r
a
ce
rt
if
ic
at
e;
e.
fo
r
fa
il
ur
e
to
co
m
pl
y
w
it
h
ar
ti
cl
e
si
x-
a
of
th
e
vl
'h
id
e
an
d
tl'
lif
fic
la
w
j
f.
fo
r
fa
il
ur
e
to
m
ai
nt
ai
n
in
ef
fe
ct
th
e
bo
nd
or
po
li
cy
of
in
su
r.
an
ce
,
or
if
a
co
rp
or
at
io
n,
th
e
co
rp
or
at
e
su
rp
lu
s
as
he
re
in
re
qu
ir
ed
01
"
if
a
se
lf
-i
ns
ur
er
th
e
re
se
rv
e
as
re
qu
ir
ed
by
th
is
ar
ti
cl
e;
g.
fo
r
fa
il
nr
e
to
p
a
y
o
r
bo
nd
an
y
ju
dg
om
en
t
of
re
co
rd
re
co
ve
re
u
Il
ri
si
ng
ou
t
of
pe
rs
on
al
in
ju
ry
OJ
'
da
m
ag
oe
to
pr
op
er
ty
he
re
ll
ft
er
in
0'
·
ca
us
ed
by
th
e
op
er
at
io
n,
m
ai
nt
en
an
ce
,
us
e
of
de
fe
ct
iv
e
co
ns
tr
ue
-
ti'J
J1
of
a
ta
xi
ca
b;
h.
fo
r
no
n-
us
e
or
fa
il
ur
e,
fo
r
si
xt
y
co
ns
ec
ut
iv
e
da
ys
,
to
op
er
at
e
th
p
ta
xi
ca
b
or
ta
xi
ca
bs
.
N
'lt
ip
e
of
su
ch
re
vo
ca
ti
on
or
su
sp
en
sl
on
sh
al
l
he
s
~
r
v
!
'
d
up
on
sw
h
fi
lx
ic
ah
op
er
at
or
,
w
he
re
up
on
su
ch
ta
xi
ca
b
op
er
at
or
sh
al
l
im
m
e(
liR
te
ly
re
m
ov
e
fr
om
hi
s
o
r
it
s
ta
xi
ca
bs
th
e
ce
rt
.if
ic
at
e
pr
ov
id
ed
fo
r
in
l'C
et
io
ll
O
il
!)
hu
nd
re
d
an
d
si
xt
y-
th
re
e
he
re
of
an
d
sh
!J,
1I
im
m
ed
ia
te
ly
ce
as
p
t.h
e
op
l;'
rI
lti
on
of
ta
xi
ca
b
se
rv
ic
e
of
al
l
th
e
ta
xi
ca
bs
co
ve
re
d
by
su
ch
ce
rt
if
ic
at
e
un
ti
l
su
ch
ti
m
e
as
th
e
sa
id
ce
rt
if
ic
at
e
or
ce
rt
if
ic
at
.e
s
sh
al
l
he
re
in
st
at
ed
or
a
ne
w
ce
rt
if
ic
at
e
or
ce
rt
if
ic
at
es
is
su
ed
th
er
ef
or
.
5.
E
ac
h
ce
rt
if
ic
at
e
sh
al
l
be
re
ne
w
ed
an
nu
al
ly
up
on
ap
pl
ic
at
io
n
th
er
ef
or
m
ad
e
by
th
e
ho
ld
er
th
er
eo
f
w
it
hi
n
te
n
da
ys
pl
'io
r
to
th
e
da
te
of
it
s
ex
pi
ra
ti
on
in
th
e
fo
rm
pr
es
cr
ib
ed
an
d
on
th
e
bl
an
k.
,>
fu
rn
is
he
d
by
th
e
co
m
m
is
si
on
an
d
su
ch
ap
pl
ic
at
io
n
sh
al
l
be
ac
co
m
pa
ni
ed
by
a
f(
e
of
fiv
e
do
ll
ar
s
fo
r
ea
ch
an
d
ev
er
y
ta
xi
ca
b
co
ve
fe
d
bv
or
re
fe
rr
ed
to
in
th
e
ap
pl
ic
at
io
n
fo
r
re
ne
w
al
.
.
~
16
4-
a.
B
on
ds
,
po
li
ci
es
,
su
rp
lu
s.
N
ot
w
it
.ll
st
an
di
ng
an
)'
ot
he
r
pr
ov
is
io
n
of
la
w
re
sp
ec
ti
ng
th
e
am
ou
nt
or
fo
rm
of
in
de
m
ni
ty
bo
nd
s
or
in
su
ra
nc
e
po
li
ri
es
re
qn
ir
ed
to
be
de
po
si
te
d
an
d
fi
le
d
w
it
h
th
e
co
m
m
is
si
on
er
of
m
ot
or
ve
hi
cl
es
by
re
rt
ai
n
pe
rs
on
s,
fi
rm
s,
as
.,>
oc
ia
-
ti
on
s
or
co
rp
or
at
io
ns
en
ga
ge
d
in
th
e
bu
si
ne
ss
of
ca
rr
yi
ng
or
tr
am
;-
po
rt
in
g
pa
s.
"f
m
ge
rs
fo
r
hi
re
in
an
y
m
ot
or
ve
hi
cl
e,
an
d
in
lie
u
th
er
eo
f
tl
le
re
sh
al
l
be
de
po
si
te
d
an
d
fi
lf
'd
w
it
h
th
e
co
m
m
is
si
on
by
th
e
op
pr
at
or
,
fo
r
ea
ch
ta
xi
ca
b
op
er
at
ed
or
to
be
op
er
at
en
hy
hi
m
or
it
in
an
y
sn
el
l
ci
ty
,
ei
th
er
a
pe
rn
on
al
ho
nd
o
w
it
h
at
le
as
t
tw
o
su
re
ti
es
,
ap
pr
ov
ed
by
th
e
co
m
m
is
si
on
,
a
co
rp
or
at
e
su
re
ty
bo
nd
or
a
po
lic
y
of
in
su
ra
nc
e.
ap
pr
ov
ed
as
to
fo
rm
an
n
su
ff
ic
ie
nc
v
by
th
c
co
m
m
is
si
on
.
in
a
co
m
pa
ny
au
t.h
or
iz
ed
to
do
bn
si
nl
'R
."
in
th
e
st
at
e,
ap
pr
ov
ed
by
th
e
su
pe
ri
nt
el
1d
en
t
of
in
su
ra
nc
e
as
to
so
h'
en
ry
an
o
re
sp
on
si
bi
li
ty
.
co
nd
it
io
np
d
fo
r
th
e
p
a
~
'
m
e
n
t
of
a
m
in
im
um
su
m
,
he
re
in
af
te
r
ca
ll
ed
lI
Ii
ni
m
nm
lia
bi
lit
.y
.
on
II
ny
on
e
ju
ng
!l
lp
nt
an
d
a
m
ax
im
um
S\1
11
1,
he
re
in
af
te
r
ca
ll
ed
lU
ax
im
um
li
ab
il
it
y
01
1
al
l
ju
dg
-
m
en
ts
re
co
ye
rr
f!
su
rh
op
en
tt
or
up
on
cl
ai
m
s
ar
is
in
fZ
(l
ut
of
th
e
sa
m
e
tr
an
sa
ct
io
u
or
tr
an
sa
ct
io
ns
co
nn
ec
te
rl
w
it
h
th
e
sa
m
e
su
hj
ec
t
of
ac
ti
on
.
to
be
ap
po
rt
io
ne
d
ra
ta
bl
y
a
m
o
n
~
th
p
ju
dl
l:
m
en
t
rr
ed
it
or
n
I!
r(
'o
rn
in
g
to
th
e
I!m
O
ll1
1t
of
th
ei
r
re
sp
p(
it
iw
jn
il
~~
lp
nt
s
fo
r
da
m
-
ADD62
54
ag
e
or
in
ju
ry
ca
us
ed
in
th
e
op
er
at
io
n,
m
ai
nt
en
an
ce
,
us
e
o
r
de
fe
ct
iv
e
co
ns
tr
uc
ti
on
of
su
rh
ta
xi
ca
b
as
fo
ll
ow
s:
(a
)
F
o
r
da
m
ag
es
fo
r
an
d
in
ci
de
nt
to
de
at
h
o
r
in
ju
ri
es
to
pe
rs
on
s;
fo
r
ea
ch
ta
xi
ca
b,
a
bo
nd
or
in
su
ra
nc
e
po
li
cy
w
it
h
a
m
in
im
um
li
ab
il
it
y
of
fiv
e
th
ou
-
sa
nd
do
ll
ar
s
an
d
a
m
ax
im
um
li
ab
il
it
y
of
te
n
th
ou
sa
nd
do
ll
ar
s;
(b
)
fo
r
da
m
ag
es
fo
r
an
d
in
ci
de
nt
to
in
ju
ry
to
or
de
st
ru
ct
io
n
o
f
p
ro
p
er
ty
;
fo
r
ea
ch
ta
xi
ca
b
a
bo
nd
or
in
su
ra
nc
e
po
li
cy
w
it
h
a
m
in
im
um
li
ab
il
it
y
of
on
e
th
ou
sa
nd
do
ll
ar
s
an
d
a
m
ax
im
um
of
fiv
e
th
ou
sa
nd
do
ll
ar
s;
(c
)
or
if
a
se
lf
-i
ns
ur
er
th
en
an
d
in
su
ch
ca
se
th
e
co
m
m
is
8i
on
sh
al
l
re
qu
ir
e
su
ch
op
er
at
or
to
de
po
si
t
an
d
m
ai
nt
ai
n
w
it
h
th
e
co
m
m
is
si
on
a
su
m
eq
ua
l
to
on
e
h
u
n
d
re
d
do
l-
la
rs
fo
r
ea
ch
an
d
ev
er
y
ta
xi
ca
b
fo
r
w
hi
ch
a
ce
rt
if
ic
at
e
ha
s
be
en
ap
pl
ie
d
fo
r
01
'
is
su
ed
,
bu
t
no
t
le
ss
th
an
fi
ft
y
th
ou
sa
nd
do
ll
ar
s
ill
ca
sh
o
r
se
cu
ri
ti
es
le
ga
l
fo
r
in
ve
st
m
en
t
by
sa
vi
ng
s
ba
nk
s,
w
hi
ch
S
ll
In
m
ay
be
in
cr
ea
se
d
by
o
rd
er
of
th
e
co
m
m
is
si
on
as
th
e
ac
ci
de
nt
or
ca
su
-
al
ty
ex
pe
ri
en
ce
of
th
e
op
er
at
or
or
th
e
n
u
m
b
er
of
ta
xi
ca
bs
op
er
at
ed
by
su
ch
op
er
at
or
m
ay
,
in
th
e
j
u
d
~
e
n
t
of
th
e
co
m
m
is
si
on
,
be
re
qu
ir
ed
.
A
ft
er
S
ep
te
m
be
r
fi
rs
t,
ni
ne
te
en
lJ
U
nd
re
d
an
d
th
ir
ty
-s
ix
,
no
ce
r-
ti
fi
ca
te
fo
r
th
e
op
er
at
io
n
of
ta
xi
-c
ab
s
in
an
y
su
ch
ci
ty
sh
al
l
he
is
s1
1e
d
to
an
y
op
er
at
or
w
ho
w
as
n
o
t
th
er
et
of
or
e
le
ga
ll
y
en
ga
ge
d
in
s1
1c
h
op
er
at
io
n
un
le
ss
su
ch
op
er
at
or
sh
al
l
be
a
co
rp
or
at
io
n,
or
ga
ni
ze
d
un
de
r
th
e
la
w
s
of
th
is
st
at
e
an
d
w
ho
se
ce
rt
if
ic
at
e
of
in
co
rp
or
at
io
n
sh
al
l
no
t
ha
ve
be
en
fi
rs
t
ap
pr
ov
ed
hy
th
e
co
m
m
is
si
on
be
fo
re
th
e
sa
m
e
sh
al
l
be
re
co
rd
ed
by
th
e
S
ec
re
ta
ry
of
S
ta
te
.
S
uc
h
ce
rt
if
ic
at
i'
of
in
co
l'-
po
ra
ti
on
,
w
he
n
su
bm
it
te
d
to
th
e
co
m
m
is
si
on
fo
r
ap
pr
ov
al
R
ha
ll
bc
ac
co
m
pa
ni
ed
by
a
sw
or
n
st
at
em
en
t
R
i!r
ne
d
by
th
e
su
hs
cr
ib
in
g
in
co
r-
po
ra
to
rs
~
m
d
by
th
e
pe
rs
on
s
na
m
ed
th
er
ei
n
as
th
e
di
ri
'c
to
rs
to
se
rv
e
un
ti
l
th
e
fi
rs
t
an
n
u
al
m
ee
ti
ng
of
st
oc
kh
ol
de
rs
to
th
e
ef
fe
ct
th
at
su
ch
pe
rs
on
s
ar
e
th
e
ac
tu
al
pa
rt
ie
R
in
in
te
re
st
an
d
ar
e
no
t
ac
tin
g:
fo
r
ot
he
rs
.
B
ef
or
e
ac
ti
n
g
up
on
lin
ap
pl
ic
at
io
n
fo
r
th
e
ap
pr
ov
al
o
f
R
uc
h
ce
rt
if
ic
at
e
of
in
co
rp
or
at
io
n,
th
e
co
m
m
is
si
on
sh
al
l
in
q
u
ir
e
w
he
th
er
an
y
of
th
e
pe
rs
on
s
su
bs
cr
ib
in
p;
to
su
ch
ce
rt
if
ic
at
e
or
na
m
ed
th
er
ei
n
as
di
re
ct
or
s
w
er
e
or
ar
e
co
nn
ec
te
d
as
of
fi
ce
r,
di
re
ct
or
o
r
st
oc
kh
ol
de
r
in
an
y
ot
he
r
ta
xi
ca
b
o
p
er
at
in
g
co
m
pa
ny
in
su
ch
ci
ty
o
r
ha
d
or
ar
e
en
ll
ag
ed
in
su
ch
bu
si
ni
's
s
as
in
di
vi
du
al
s.
If
th
e
co
m
m
is
si
on
fi
nf
l
th
at
su
ch
pe
rs
on
s
o
r
an
y
of
th
em
h
ad
be
en
co
nn
ec
te
d'
w
it
h
an
y
ta
xi
ca
b
op
er
at
in
g
bu
si
ne
ss
w
hi
ch
si
nc
e
th
e
en
ac
tm
en
t
of
th
is
ar
ti
cl
e,
hw
l
de
fa
ul
te
d
in
sa
ti
sf
yi
ng
o
r
bo
nd
in
g
an
y
ob
li.
ga
tio
n
ar
is
in
g
on
t
of
in
ju
ry
to
li
fe
o
r
da
m
ag
e
to
p"
op
er
ty
ca
us
ed
in
th
e
op
er
at
io
n.
m
ai
n-
te
na
nc
e,
llR
e
o
r
d
d
ec
ti
v
e
co
ns
tr
uc
ti
on
of
ta
xi
ca
bs
or
w
it
h
an
y
pe
rs
on
w
ho
se
ce
rt
if
ic
at
e
h
ad
be
en
re
vo
ke
d.
ca
nc
el
le
d
o
r
be
co
m
e
nu
ll
an
d
vo
id
fo
r
fa
il
ur
e
to
co
m
pl
y
w
it
h
th
e
re
qu
ir
em
en
ts
of
th
is
ar
ti
cl
e,
it
sh
al
l
rc
fu
se
to
ap
pr
ov
e
su
ch
ce
rt
if
ic
at
e
of
in
co
rp
or
at
io
n.
E
ve
ry
su
ch
cQ
rp
or
at
io
n
sh
al
l
ha
ve
an
d
m
ai
nt
ai
n
an
an
th
or
iz
ed
ca
pi
ta
l
st
nc
k
of
no
t
le
8s
th
an
fi
ft
y
th
ou
sa
nd
do
lla
rR
an
d
an
un
im
pa
ir
ed
su
rp
Iu
R
,
in
ca
sh
or
se
cu
ri
ti
es
,
le
ga
l
fo
r
in
ve
8t
m
en
t
by
sa
vi
ng
s
ha
nl
,s
in
an
am
ou
nt
no
t
le
ss
th
an
fi
ft
y
pe
r
ce
nt
of
it
s
al
lt
ho
ri
ze
d
an
d
fu
ll
y
pa
id
in
ca
pi
ta
l.
'W
he
ne
ve
r
th
e
"u
rp
lw
;
of
su
ch
co
rp
or
at
io
ll
"h
rt
ll
be
55
di
m
in
is
he
d
or
de
pl
et
ed
,
th
e
tr
ea
su
re
r
of
su
ch
co
rp
or
at
io
n
sh
al
l,
w
it
hi
n
tw
o
da
ys
of
su
ch
di
m
in
ut
io
n
o
r
de
pl
et
io
n,
gi
ve
no
ti
ce
th
er
eo
f
ill
w
ri
ti
ng
,
to
th
e
co
m
m
is
si
on
,
w
hi
ch
no
ti
ce
sh
al
l
be
se
rv
ed
pe
r-
so
na
ll
y
up
on
th
e
co
m
m
is
si
on
,
o
r
by
re
gi
st
er
ed
m
ai
l,
se
tt
in
g
fo
rt
h
th
e
ca
us
e
re
su
lt
in
g
in
su
ch
di
m
in
ut
io
n
or
de
pl
et
io
n
an
d
th
e
ex
te
nt
tb
er
eo
f.
F
ai
lu
re
to
gi
ve
su
ch
no
ti
ce
,
in
th
e
ev
en
t
of
th
e
di
m
in
ut
io
n
or
de
pl
et
io
n
of
th
e
su
rp
lu
s,
w
it
hi
n
th
e
ti
m
e
an
d
in
th
e
m
an
ne
r
h
~
r
e
i
n
re
qu
ir
ed
,
sh
al
l
be
pu
ni
sh
ab
le
as
a
m
is
Je
m
ea
no
r,
an
d
by
th
e
re
vo
ca
ti
on
an
d
ca
nc
el
la
ti
on
of
al
l
ce
rt
if
ic
at
es
he
ld
by
su
ch
co
rp
or
a-
ti
on
an
d
al
l
of
fi
ce
rs
,
di
re
ct
or
s
an
d
st
oc
kh
ol
de
rs
of
su
ch
co
rp
or
at
io
n
sh
al
l
be
th
er
ea
ft
er
di
sq
ua
li
fi
ed
,
ei
th
er
as
in
di
vi
du
al
s
or
ll
S
of
fi
ce
rs
,
di
re
ct
or
s
an
d
st
oc
kh
ol
de
rs
of
a
co
rp
or
at
io
n
op
er
nt
in
g
o
r
in
te
nd
in
g
t()
op
er
at
e
ta
xi
ca
bs
in
an
y
R
uc
h
ci
ty
fr
om
re
ce
iv
in
g
ce
rt
if
ic
at
es
of
pu
bl
ic
ne
ce
ss
it
y
an
d
co
nv
en
ie
nc
e
le
ga
li
zi
ng
ta
xi
ca
b
op
er
at
io
ns
in
an
y
su
ch
ci
ty
as
in
th
is
ar
ti
cl
e
re
qu
ir
ed
.
'W
he
ne
ve
r
th
e
co
rp
or
at
e
sn
rp
lu
s
sh
al
l
ha
ve
be
en
re
du
ce
d
be
lo
w
an
am
ou
nt
eq
ua
l
to
fi
ft
y
pe
r
c!
'n
tu
m
of
th
e
an
th
or
iz
ed
Il
nd
fu
ll
y
pa
id
in
ca
pi
ta
!
of
su
ch
co
rp
or
a-
ti
on
,
th
e
ce
rt
if
ic
at
e
o
r
ce
rt
if
ic
at
eR
sh
al
l
he
R
U
R
pe
nd
ed
fl}
r
a
pe
ri
od
of
fiv
e
da
ys
in
w
hi
ch
th
e
co
rp
or
at
io
n
R
ha
U
re
pl
en
if
lh
th
e
co
rp
or
at
e
s
~
t
r
p
l
u
s
to
th
e
am
l}
un
t
re
qu
ir
ed
by
th
if
ls
ec
ti
on
an
d
un
ti
l
su
ch
R
llr
pl
us
sh
al
l
ha
ve
be
en
fu
ll
y
re
pl
i'n
is
he
d
an
d
th
e
co
m
m
iR
si
on
sa
ti
sf
ie
d
by
sl
le
h
pr
oo
f
th
er
eo
f,
as
it
m
ay
re
qu
ir
e,
sn
ch
co
rp
or
at
io
n
m
ay
no
t
en
ga
ge
in
ta
xi
ca
b
op
er
at
io
n
in
an
y
su
ch
ci
ty
.
If
su
ch
co
rp
or
at
io
n
sh
al
l
fa
il
to
re
pl
en
is
h
it
s
su
rp
ln
s,
w
it
hi
n
fiv
e
da
ys
af
tf>
r
it
s
di
m
in
n-
ti
lm
or
de
pl
et
io
n,
th
e
ce
rt
if
ic
at
e
o
r
ce
rt
if
ic
at
es
he
ld
by
it
sh
;,
ll
be
nu
ll
an
d
vo
id
.
N
o
ce
rt
if
ic
at
e
of
in
co
q)
{)
ra
ti
on
sh
al
l
be
ap
pr
ov
ed
by
th
e
co
m
m
is
si
on
un
le
ss
it
sh
al
l
ha
ve
re
ce
iv
ed
pr
oo
f
th
at
su
ch
pr
op
os
ed
co
rp
or
at
io
n
sh
al
l
ha
ve
a
fu
ll
y
pa
id
in
ea
pi
ta
l
of
no
t
le
R
s
th
an
fi
ft
y
tl
:o
us
an
d
do
ll
ar
s
an
d
an
un
im
pa
ir
ed
su
rp
lu
s
in
ca
sh
or
se
eu
ri
ti
cs
le
g'
al
fo
r
in
Y
es
tm
en
t
hy
sa
vi
ng
s
ba
nk
s
in
an
am
on
nt
no
t
le
ss
th
an
fi
ft
y
pe
r
ce
nt
um
of
th
e
au
th
or
iz
ed
an
d
fu
ll
y
pa
id
in
ca
pi
ta
l.
§
16
4-
b.
T
he
co
m
m
is
R
io
n
sh
al
l
ad
o
p
t
ru
le
R
an
d
re
gu
la
ti
on
s
pr
o-
vi
di
ng
fo
r
th
e
in
sp
ec
ti
on
o
f
al
l
ta
xi
ca
bs
op
er
at
in
g
in
sn
eh
ci
ty
at
su
ch
pe
ri
od
s
an
d
in
su
ch
m
an
ne
r
as
it
m
ay
di
re
ct
an
d,
w
he
n
ad
op
te
f!
,
sh
al
l
ha
ve
th
e
fo
rc
e
an
d
ef
fe
ct
o
f
la
w
.
T
he
vi
ol
at
io
n
o
f
R
uc
h
rn
le
R
an
d
re
gu
la
ti
on
s
sh
al
l
co
ns
ti
tu
te
a
m
is
de
m
ea
no
r
pu
ni
sh
ab
le
as
pr
o-
vi
de
d
in
th
e
ve
hi
cl
e
an
d
tr
af
fi
c
la
w
.
T
he
co
m
m
is
si
on
m
ay
re
q
n
ir
e
ea
ch
ta
xi
ca
b
to
ha
vc
pr
om
in
en
tl
y
di
sp
la
ye
d
th
er
eo
n
a
ce
rt
if
ic
at
e
ev
id
en
ci
ng
an
in
sp
ec
ti
on
th
er
eo
f
in
ac
co
rd
an
ce
w
it
h
it
s
ru
le
s
an
ll
re
gu
la
ti
on
s
w
it
hi
n
a
pe
ri
od
o
f
si
x
m
on
th
s
la
st
pr
ec
ed
in
g.
T
he
ru
le
R
an
d
re
gu
la
ti
on
s
to
be
ad
op
te
d
in
pn
rs
ua
nc
e
he
re
of
sh
al
l
in
so
fn
r
a
~
pr
ac
ti
ca
bl
e
be
u
n
if
o
rm
;
an
d
th
e
pr
ov
is
io
ns
of
th
e
ve
hi
cl
e
an
d
tr
af
fi
c
la
w
,
so
fa
r
as
ap
pl
ie
ab
le
an
d
no
t
in
co
nf
li
ct
w
it
h
th
e
pr
o-
vi
si
on
s
of
th
is
se
ct
io
n,
sh
al
l
co
nt
in
ue
to
re
m
ai
n
in
fn
ll
fo
rc
e
an
d
ef
fe
ct
.
§
16
5.
P
ay
m
en
ts
by
op
er
at
or
s
to
('i
ti
es
in
li
en
of
ta
xe
s.
In
an
y
ci
ty
to
w
hi
ch
th
e
pr
ov
is
io
ns
of
th
is
ar
ti
cl
e
ap
pl
y,
ea
ch
ta
xi
ca
b
op
er
at
or
ho
ld
in
g
a
ce
rt
if
ic
at
e
or
ce
rt
if
ic
at
es
sh
al
l,
in
su
ch
m
an
ne
r
ADD63
56
as
th
e
co
m
m
is
si
on
m
ay
pr
es
cr
ib
e,
rp
po
rt
an
d
p
ay
to
ev
er
y
su
ch
ci
ty
in
w
hi
ch
hi
s
or
it
s
ta
xi
ca
'b
6
op
er
at
e
on
A
p
ri
l
fi
rs
t,
ni
ne
te
en
hu
nd
re
d
th
ir
ty
-s
ev
en
an
d
on
th
e
fi
rs
t
d
~
y
s
of
O
ct
ob
er
an
d
A
p
ri
l
of
ea
ch
an
d
ev
er
y
ye
ar
th
er
ea
ft
er
o
n
e
-
l
~
a
l
f
of
on
e
pe
rc
en
tu
m
of
th
e
gr
os
s
re
ve
nu
e
de
ri
ve
d
fr
om
th
e
op
er
at
io
n
of
hi
s
or
it
s
ta
xi
.
ca
bs
u
n
d
er
su
ch
ce
rt
if
ic
at
e
or
ce
rt
if
ic
at
eR
fo
r
th
e
pr
ec
ed
in
g
h
al
f
ye
ar
en
di
ng
re
sp
ec
ti
vP
ly
on
S
ep
te
m
be
r
th
ir
ti
et
h
an
d
M
ar
ch
th
ir
ty
-
fi
rs
t,
as
co
m
pn
te
d
an
d
re
co
rd
ed
by
th
e
ta
xi
m
et
er
s
on
su
ch
ta
xi
ca
b
or
ta
xi
ca
bs
,
b
u
t
su
ch
pa
ym
en
t
sh
al
l
no
t
be
le
l';
s
th
an
se
ve
n
do
lla
r!
'!
an
d
fi
ft
y
ce
nt
s
se
m
i-
an
nu
al
ly
,
pa
ya
bl
e
as
in
th
is
se
ct
io
n
pr
ov
id
ed
.
§
16
5-
a.
P
ow
er
of
c.
ity
to
ex
am
in
c
an
d
au
d
it
ac
co
un
ts
.
E
v
er
y
ci
ty
sh
al
l
ha
ve
th
e
po
w
er
to
ex
al
lJ
in
e
an
d
au
d
it
th
e
bo
ok
s
of
ac
co
ll
nt
of
an
y
ho
ld
er
of
a
ce
rt
if
ic
at
e
of
co
nv
en
ie
nc
e
an
d
ne
ce
ss
it
y
fo
r
th
e
op
er
at
io
n
of
ta
xi
ca
bs
w
it
hi
n
su
eh
ci
ty
w
it
h
th
e
fu
ll
po
w
er
to
su
bp
oe
na
bo
ok
s,
re
co
rd
s
an
d
pe
rs
on
s
in
ai
d
th
er
eo
f.
A
ft
er
th
is
ar
ti
cl
e
sh
al
l
ta
ke
ef
fe
ct
,
no
lic
en
R
es
,
pe
rm
it
s,
m
oo
al
lio
nf
i;
or
ot
he
r
in
di
ci
a
of
au
th
o
ri
ty
to
ll
pe
ra
te
a
ta
xi
ca
b
in
su
ch
ci
ty
,
sh
al
l
be
is
su
ed
by
an
y
po
li
ee
co
m
m
is
si
on
er
,
li
ce
ns
e
co
m
m
is
."
io
ne
r
or
ot
he
r
of
fi
ci
al
,
bu
re
au
or
d
ep
ar
tm
en
t
of
su
ch
ci
ty
,
w
it
ho
ut
a
ce
rt
if
i_
ca
te
is
su
ed
by
th
e
cO
lll
m
is
R
io
n
ac
co
m
pa
ny
in
g
th
e
ap
pl
ic
at
io
n
th
rr
e-
fo
r;
b
u
t
th
is
pr
ov
is
io
n
sh
al
l
no
t
be
dc
em
ed
to
pr
ev
en
t
or
pr
eV
l'n
t
th
(J
po
lic
e
co
m
m
is
si
on
er
of
an
y
su
ch
ci
ty
fr
om
re
ne
w
in
g
an
d
re
is
:m
in
l!
on
A
p
ri
l
fi
rs
t,
ni
ne
te
en
hu
nd
rl
'd
th
ir
ty
-s
ix
,
an
y
ll
le
da
ll
lo
ns
fo
l"
an
y
ta
xi
ca
bs
th
er
et
of
or
e
le
ga
ll
y
en
ga
ge
d
in
op
er
at
io
n.
§
16
6.
R
at
es
to
be
fi
xe
d
by
th
e
co
m
m
is
si
on
.
T
he
co
m
m
is
si
on
,
af
te
r
a
he
ar
in
g
h
ad
up
on
it
s
m
ot
io
n
or
np
on
co
m
pl
ai
nt
or
up
on
ap
pl
ic
at
io
n
th
er
ef
or
,
bu
t
af
te
-r
no
ti
ce
to
th
e
ta
xi
ca
b
op
er
at
or
or
op
er
at
or
s
in
te
re
st
ed
th
er
ei
n,
th
e
ci
ty
an
d
al
l
ot
he
r
pe
rs
on
s
o
r
co
rp
or
at
io
ns
de
em
ed
by
th
e
co
m
m
is
si
on
to
be
in
te
re
st
l'd
th
er
ei
n,
m
ay
fix
an
d
de
te
rm
in
e
th
e
ra
te
s,
fa
re
s
or
ch
ar
ge
s
to
be
de
m
an
dl
'd
,
ex
ac
te
d,
eh
ar
ge
d
or
co
U
ec
tf
'd
w
it
hi
n
a
ci
ty
w
it
hi
n
it
s
ju
ri
sd
ic
ti
on
,
pr
ov
id
ed
,
ho
w
ev
er
,
th
at
su
ch
ra
te
s,
fa
re
s
or
ch
ar
ge
s
sh
al
l
be
un
if
or
m
w
it
hi
n
su
ch
ci
ty
.
§
16
6-
a.
D
es
ig
na
ti
on
of
ha
ck
st
an
ds
.
It
sh
al
l
be
th
e
d
u
ty
of
th
e
po
li
ce
co
m
m
is
si
on
er
,
ch
ie
f
of
po
lic
e.
co
m
m
is
si
on
er
of
pu
bl
ic
sa
fe
ty
an
d
co
m
m
is
si
on
er
or
su
pe
ri
nt
en
de
nt
of
pa
rk
s
in
an
y
su
ch
ci
ty
,
up
on
th
e
re
qu
es
t
of
th
e
co
m
m
is
si
on
to
de
si
gn
at
e
sp
ac
e
re
se
rv
ed
up
on
it
s
st
re
et
,
hi
gh
w
ay
s,
pa
rk
w
ay
s
an
d
pu
bl
ic
pl
ac
es
as
pu
bl
ic
st
an
ds
fo
r
th
e
us
e
of
ta
xi
ca
bs
so
li
ci
ti
ng
an
d
aw
ai
ti
ng
hi
re
.
S
uc
h
pu
bl
ic
st
an
ds
sh
al
l
he
m
ar
ke
d
by
a
m
et
al
si
gn
or
be
ot
he
rw
is
e
m
ar
ke
d
of
f
an
d
de
si
gn
at
ed
.
T
he
po
lic
e
co
m
m
is
si
on
er
,
ch
ie
f
of
po
lic
e,
co
m
m
is
si
on
er
of
pu
bl
ic
sa
fe
ty
or
co
m
m
is
si
on
er
or
fm
pe
ri
n,
te
nd
en
t
of
p
ar
k
s
m
ay
pr
es
cr
ib
e
th
e
nu
m
be
r
of
ta
xi
ca
bs
w
hi
ch
at
an
;y
on
e
ti
m
e
m
ay
be
al
lo
w
ed
to
ga
th
er
at
sl
w
h
pl
lb
li
c
st
an
d.
N
ot
hi
ng
in
th
is
se
ct
io
n
co
nt
ai
ne
d
sh
al
l
pr
ev
en
t.
sn
eh
co
m
m
is
si
on
er
,
ch
ie
f
or
su
pe
ri
nt
en
de
nt
fr
om
de
si
gn
at
in
g
an
y
ot
he
r
pl
ac
es
or
po
in
t."
$
up
on
th
e
st
re
et
s,
hi
gh
w
ay
s,
pa
rk
w
ay
s
an
d
pH
hl
ie
pl
ac
es
of
su
ch
ci
ty
as
su
ch
pu
hl
ic
st
an
ds
.
57
T
he
po
lic
e
d
ep
ar
tm
en
t
or
d
ep
ar
tm
en
t
of
pu
bl
ic
sa
fe
ty
an
d
th
e
co
m
m
is
si
on
er
or
ch
ie
f
th
er
eo
f
in
an
y
su
ch
ci
ty
sh
al
l
en
fo
rc
e
an
d
as
si
st
in
en
fo
rc
in
g
an
y
an
d
al
l
or
de
rs
,
ru
le
s
an
d
re
gu
la
ti
on
s
is
su
ed
or
pr
om
ul
ga
te
d
by
th
e
co
m
m
is
si
on
p
u
rs
u
an
t
to
th
is
ch
ap
te
r,
an
d
m
ak
e
re
po
rt
to
su
ch
co
m
m
is
si
on
of
it
s
di
sp
os
it
io
n
of
ea
ch
ca
se
in
vo
lv
in
g
th
l'
sa
m
e.
§
16
7.
R
ep
ea
l
of
co
nf
li
ct
in
g
la
w
i:l
.
A
ll
ac
ts
,
lo
ca
l
la
w
s
an
d
or
di
na
nc
es
,
or
pa
rt
s
th
er
eo
f,
in
co
nR
is
te
nt
or
in
co
nf
lic
t
he
re
w
it
h
ar
e
he
re
by
to
th
at
ex
te
nt
sp
ec
if
ic
al
ly
re
pe
al
ed
.
§
16
8.
S
av
in
g
cl
au
se
.
If
an
y
pr
ov
is
io
n
of
th
is
ar
ti
cl
e
or
th
e
ap
pl
ic
at
io
n
th
er
eo
f
to
an
y
pe
rs
on
or
ci
rc
um
st
an
ce
s
is
he
ld
in
va
li
d,
th
e
va
li
di
ty
of
th
e
re
m
ai
nd
er
of
th
is
ar
ti
cl
e
un
d
of
th
e
ap
pl
ic
at
io
n
of
su
ch
pr
ov
is
io
n
to
ot
he
r
pe
rs
on
s
an
d
ci
rc
um
st
an
ce
s
sh
al
l
no
t
be
af
fe
ct
ed
th
er
eb
y.
§
2.
'I'
hi
s
ae
t
sh
al
l
ta
ke
f'f
fe
ct
im
m
l'd
ia
tf
'ly
.
ADD64
~~:I .
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t;?',
~~
1~)."'lIIInfdIl!Jiffii
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'=1
Regulation of the New York City Taxicab Industry
Highlights A summary of the issue by the editors 2
Service Scorecard The Police Department 10
Fiscal Update A bimonthly reuiew of New York City Finances
-. ~. :
Regulation of the New York City Taxicab Industry
By Edward G. Rogoff
....
.r
!
,I
;
:\
J
i
Regulation of the New York City taxicab industry has
been, to say the least, a problem. Since 1907, when the
gasoline-powered taxicab was introduced in the city, five
mayoral committees, two federal investigations, and one
state commission have been charged to study the industry
and to make recommendations on its regulation. Actual reg-
ulation of the taxicab industry has been handled at different
times by the Board of Aldermen, the Bureau of Licenses,
the Board of Taxicab Control. the Police Department, the
City Council and, since 1971, the Taxi and Limousine Com-
mission. Currently; a proposal is pending before the City
Council to move regulation of the industry to the Depart-
ment of Consumer Affairs.
The number of mayoral commissions is exceeded only by
the number of scandals involving both the industry and its
regulators. The outpouring of complaints about the qualifi-
cations of drivers, the conditions of taxicabs, taxicab avail-
ability, and the fare is enormous. There have even been
riols by drivers who, since 1907, have joined in substantial
numbers no fewer than seven unions. Criticism of taxicab
regulation has been an editorial mainstay of every major
newspaper in New York City for over 70 years.
Are these problems the result of an intractable situation?
Must New Yorkers accept the fact that improving regulation
of Ihe taxicab industry will remain as difficult as finding a cab
on a rainy Friday afternoon? Because so much of the regula-
tion and structure of the taxicab industry today have deep
historical roots, it is necessary to trace their origins before
attempting to answer these questions. Further, understand-
ing the intended and unintended effects of past regulations
on the industry and the public is the first step to answering
the question of where public policy should go from here.
Origins of the Industry and Its Regulation
The history of the modern taxicab industry in New York
City begins on October 1, 1907, when 25 gasoline-powered
French Darracq taxicabs owned by the New Taxicab Com-
pany paraded down Fifth Avenue to take up positions at the
hack stand in front of the Plaza Hotel, which celebrated its
grand opening on the same day. Prior to that time, the gaso-
line-powered vehicle was maligned as balky, noisy, and a
source of noxious odors. But, more important, the New
Taxicab Company's vehicles were equipped with meters so
that rates, based on distance traveled, could be determined
exactly. Such rates had been set by city ordinance for Han-
som cabs as early as 1839, but ascertaining the exact
distances traveled had been difficult, and many drivers
were accused of overcharging. The new taximeter was
hailed as the solution to the problem (and is the basis for the
term "taxicab").
The New Taxicab Company's fleet quickly grew to 65
vehicles before the company went out of business in 1909 in
the wake of a drivers' strike. But the soundness of the new
vehicles did not escape other entrepreneurs. By 1912, there
were 2,800 gasoline-powered taxicabs on the streets of New
York City. The horse-drawn Hansom cab was qUickly rele-
gated to leisure trips, unable to compete with its horseless
counterpart, which charged a meter-determined fare at half
the price and traveled twice as fast.
In June 1909, the Board of Aldermen passed the first city
ordinances to deal specifically with motor-powered taxicabs.
Arising out of complaints about poorly calibrated meters, the
new ordinances called for the Bureau of Licenses to inspect
meters and to license taxicabs. In addition, the Board of
Aldermen established maximum rates identical to those Hrst
charged by the New Taxicab Company.·
In 1913, the first major scandal occurred involving regula-
tion of the industry. Whim'a bill to raise the maximum fare
was introduced in the Board of Aldermen, testimony by the
district attorney revealed that the industry was providing free
taxicab service to aldermen. police officials, and the chief of
the Bureau of Licenses. The district attorney also alleged
that meter inspectors were being paid to approve faulty
meters.2 Newspapers picked up the accusations and began
publicizing the industry practice of purchasing "curb fran-
chises" in rront of hotels, restaurants, and theaters. a prac-
tice dating back to the era of the Hansom cab. As the result
Continued on page 3
I i
PUblished bimonthly by the Center for New York City Affairs of the New School (or Social Research
ADD65
&.
n'''W'tiiii'''''''iiiiji'iiiij'iiiii'i iliiliUiit
CrtyAlmanac
iiiiiihh""'" "'''''' ""mhiiiiiilililiWj"""'iih'ii' h"li "!
'Highlights-A Summary of the Issue by the Editors
. Regulation of the Taxicab Industry-After reviewing taxi-
cab regulation in New York City over the last 70 years, the
author concludes that the principles of fixed fares and a limit
on the number of medallions should be abandoned. He
recommends that, to serve the public interest, regulation
should focus on four areas.
• A ma>eimum Jore. The city should set a maximum fare
only and permit price competition below that level. This
would result in lower rates at off-peak times and for smaller
or nonair-conditioned cabs. Moreover, the setting of maxi-
mum fares should be shifted from the current link to fleet
operating costs, particularly wage increments, to profitabil-
ity, which is reflected in medallion prices. In other words,
fare increases should be permitted only when medallion
prices fall.
• Driver qualifications. The licensing of drivers is now
designed to eliminate applicants with criminal records and,
more recently, immigrants without work permits or "green
cards." But a thorough knowledge of the city's geography
should also be required.
• Vehicle soJety. Safety should continue to be a major
focus of regulation. Fleet taxicabs, in part because the fleets
are only marginally profitable, account for most of the
unsafe vehicles.
• Congestion. Limiting the number of medallions was ini-
tially Intended to prevent congesting the streets with cruising
taxicabs. This aim has not been achieved because medal-
lioned cabs concentrate in the most profitable areas, such as
mid-Mlmhattan, leaving gypsy cabs to serve other neighbor-
hoods. A more effective approach would entail the sel1ing of
Service Scorecard-The Police Department has responded
to fiscal stringency by shifting its priorities to th~ most critical
area of crime control-the arrest of felons. The department
has maintained its level of felony arrests during the fiscal
crunch although a modest decline was evident In 1978 and
1979. Moreover, the quality of this function, as reflected in
the felony arrest rate (share of reported felonies resulting in
Fiscal Update-The summer calm that usually character-
izes New York City's annual budget and financial planning
was notably absent this year. After adoption of the city's
fiscal 1981 budget in mid-June, the uncertain results of col-
lective bargaining with municipal employee unions caused
the city to withdraw the plan it had submitted to the Finan-
cial Control Board. In an unprecedented action, the FeB
prepared its own "bridge plan" and imposed it on the city for
the first quarter of fiscal 1981.
In August, the city submitted a revised plan for the com-
ing four fiscal years, and, with subsequent modifications. the
FCB approved it on September 18. As a result of the labor
settlement. the plan recognizes $168 million in added labor
costs during fiscal 1981 over those in the adopted budget.
These added costs, plus losses of federal aid, are offset pri-
2
special licenses to those operators who wanted to cruise in
the most congested areas.
The author also discusses the follOWing issues currently
facing the Taxi and Limousine Commission, the city agency
responsible lor regulating the industry:
• Minifleets. Since the 1970s, the minifleet has become
the dominant mode of operation. A Corporation of usually
two medallions owned by two drivers, the minif/eet gener-
ally offers safer and cleaner service than fleet taxicabs but
operates fewer hours. Recently, the commission has tried to
force minifleets to operate two shifts to offset the reduction
in taxicab service.
• Group riding. The commission has sponsored "con-
trolled" group riding to and from airports since 1978, a plan
in which a dispatcher organizes the group and inlorms each
rider of the fare. A plan for "uncontrolled" group riding
under which each rider would save 50 cents for each addi-
tional passenger picked up has been tabled.
• Nighttime differentials. The main rationale for the dif-
ferential is to counter the shortage of service at night by in-
ducing drivers to work more hours for the added revenue.
But most taxicabs already operate around the clock, and a
differential would increase nighttime service only at the
expense of service during the day.
• Gypsy taxicabs. Since they appeared in the early
1960s, unregulated gypsy taxicabs have been controversial.
Those served by gypsy cabs should have some of the pro-
tection afforded by regulation of medallioned cabs-ade-
quate insurance, accurate meters, properly licensed drivers,
and some recourse lor mistreatment.
an arrest), was maintained during the 1970s.
This shift of priorities has been achieved at some cost. In
1970-79, misdemeanor arrests declined 27% and arrests for
violations fe1l75%. In the future, the department may find it
more difficult to adjust to retrenchment because it has been
left less flexible to alter its allocations of basic resources-
money and personnel.
marlly by revised land higher) tax forecasts. The new plan
also forecasts a budget gap of $733 million for fiscal 1982.
but the city's fiscal monitors have put the figure at $1.075
billion and have also judged as uncertain actions the city
proposes to close the gap.
Over the summer, major changes in the city's financial
plans were also approved and their implementation begun.
The current plan calls for the use 01 $900 million of standby
federal loan guarantees during fiscal 1981 and 1982, an
increase in MAC's borrowing authority, and a slower ap-
proach by the city to gaini.ng access to the public credit mar-
kets. As contemplated in a similar MAC proposal made pub-
lic in June, the city would not begin funding all 01 its capital
needs through public sales of its bonds until the second half
of fiscal 1985.
Volume 15 Number 2
ADD66
CityAlmanac
\
!'''''"'"l11iiiiW''lii!ii!!'!I!'''''!!!limiiiiiiil''''''''liiiiiiiii"i1iii''"ii1illiiiiiiWiidililiii"""'i1I11i1ii""""'''''tliliiliilllll'''''!Iti''''''itI''''''''ii1i1iiililliiiliililiiiil''i!iiiliillliilitiifiiiiiiililiilliiiillillhWii"""lIliiiiiiiliilli""Wiil!lliliiiiWil
Continued from page 1 - Regulation of the Taxicab Industry
Volume 15 Number 2 August 1980---
The Depression: Continued Oversupply
and Regulatory Reactions .
The early Depression years saw a one-third drop in the
number of operating taxicabs in New York City-from
21,000 in 1931 to under 14,000 in 1934-stemming, in
large part, from a steep decline in ridership. In the summer
of 1933, the Hack Bureau, enforcing a Board of Aldermen
Seabury's charges was that Mayor 'Walker had received
bonds worth $26,000 from J. A. Sisto, the underwriter of
the securities of the Parmalee Company, a subsidiary taxi-
cab operation of the Checker Cab Manufacturing Company,
in exchange for the mayor's support of a franchising plan
that would have benefited large fleets such as ParmaJee's.7
As it did in 1913, the Board of Aldermen did an about·
face in the shadow of scandal. In the aftermath of Mayor
Walker's resignation on September 1, 1932, the aldermen
abandoned the franchising plan, and, later that year, Acting
Mayor Joseph McKee abolished the Board of Taxicab Con-
trol. On April 3. 1933, Mayor John P. O'Brien signed into
law a bill returning enforcement powers over taxicab regu-
lation to the Police Department's Hack Bureau and other
regulatory powers to the Board of Aldermen.
NEW SCHOOL
FOR SOCIAL RESEARCH
President
John R. Everett
Chairman, Board of Trustees
Henry A. Loeb
City Almanac (ISSN 0009·7683)
is published bimonthly by the
Center for New York City
AMain, New School lor
Social Research, 66 Fifth Avenue,
New York, NY 10011. Phone: (212)
741-5956. All rights reserved. No
part 01 this publication
may be produced without prior
written Permission of the
Center for New York City Affairs.
Second-class postage paid
at New York, NY. Subscription
and quantity order rates
available upon request.
CENTER FOR
NEW YORK CI1Y AFFAIRS
Dean
Henry Cohen
Associate Dean
Jerome Liblit
Chairman, Board of Overseers
Adrian W. De Wind
ADVISORY BOARD
Co-chairman
Robert Rubin
Co-chairman
Jerry I. Speyer
Members
Amos T. Beason
Seymour Durst
Jac Friedgut
Karen Gerard
Charles A. Goldstein
Joel Harnett
Joseph Healey
Gedale Horowitz
Marilyn Levy
Robert Lester Loeb
Burton Resnick
Daniel Rose
Jean J. Rousseau
Herbert Singer
Julien J. Studley
John Thompson
Co-editor
Raymond D. Horton
Co-editor
Charles Brecher
Managing Editor
Arley Bondarin
Consultant
Blanche Bernstein
Taxicab Oversupply: 1923-33
The infant taxicab industry was growing at an enormous
rate-from 2,800 taxicabs in 1913 to 15,000 in 1923-and
during the early 1920s the first complaints about an over-
supply of taxicabs arose. The New York Times blamed in-
creasing midtown Manhattan traffic congestion on the large
number of taxicabs.3 The Hotel Association complained that
too many cabs were dirty and unsafe and that too many
drivers did not speak English and were unfamiliar with the
geography of the city.4 The police commissioner charged
that cabdrivers were beginning to use their vehicles for felo-
nious purposes because, he felt, they could not earn a living
only from fares. s
The fact that supply was beginning to outstrip demand in
the 1920s was evidenced by the onset of price competition.
Since the first rate regulation by the Board of Aldermen in
1909 only established a maximum fare, cabs were allowed
to charge any fare below that rate. By the mid-1920s, the
prevailing rate was about half the legal maximum.
By 1931, there were 21,000 taxicabs on the streets of
New York City. To deal with the problems of excess cabs,
traffic congestion, and low per cab earnings, Mayor James
Walker announced in January 1930 a plan under which the
city would sell a franchise to a single firm to operate taxicabs
in the city. The advantages· of such a plan, the mayor
asserted, were that the city would derive substantial revenue
from the sale of the franchise, congestion would be relieved,
and drivers' earnings would go up with higher utilization.
Afraid that they would be the ones denied the franchise,
almost all taxicab owners reacted coolly to the mayor's pro-
posal, and in April he appointed a commission to study
various other proposals.
On September 30, 1930, the mayor's commission issued
its report. It cited the oversupply of taxicabs as a major
reason for the number of avoidable accidents, the excessive
cruising that disrupted traffic flow, and the industry's failure
to provide steady employment for its drivers. In summariz-
ing its conclusions, the report stated that the taxicab industry
"must be encouraged in its inevitable transition to a full
member of the public utility family."6
The commission's recommendations echoed the plan
Mayor Walker had put forward nine months earlier-to set
up a single franchise operation and guarantee current
owners their licenses for the life of their cars or for a three-
year period, whichever ended first. In addition, the com-
mission recommended placing taxicab regulation under a
separate Board of Taxicab Control. Not surprisingly, the
proposal was opposed by the drivers who owned their taxi-
cabs and by the small-fleet owners. Nonetheless, the Board
of Aldermen passed the proposal on December 21, 1931,
and Mayor Walker signed It into law on January 30, 1932.
Unfortunately for the mayor's plan, at about the time the
new Board of Taxicab Control was beginning its work,
Judge Samuel Seabury's investigation of municipal corrup-
tion in New York City was getting underway. Among Judge
of these and other revelations of corruption, the Board of
Aldermen voted almost unanimously to reduce. rather than
increase, the maximum fare.
August 1980 3
ADD67
CityAlmanac
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directive, blocked some fleets and owner-driver associations
from lowering their rates and initiating a rate war. The
bureau was conc.erned that the drivers, whose earnings
before any rate cuts averaged about $12 a week, would turn
to cheating passengers and other illegal activities to supple-
ment their reduced incomes.
The LaGuardia Commfttee
In February 1934, Mayor Fiorello LaGuardia appointed a
committee to study the industry and make recommenda-
tions. Four months later, the committee issued its report,
which cited the familiar problems of the industry-still too
many taxicabs (despite the impact of the Depression) t too
much cruising, and inadequate insurance.s The report
added a number of driver-related problems-too many driv-
ers, high turnover, job Insecurity, long hours, and low
wages. In addition, the committee covered problems relat-
ing to the structure and finances of the industry. It alleged
that taxicab manufacturers were gaining control of the in-
dustry both directly through their ownership of fleets and in-
directly through easily gr~nted mortgages, which put a large
debt burden on owner-drivers and forced them, in effect, to
work for the manufacturers. Finally, the committee exam-
ined the Hack Bureau and concluded that its regulation of'
the industry cost the city too much money and siphoned off
police personnel from more important functions.
In setting its goals, the LaGuardia committee felt that any
new regulations must walk the fine line between monopoly,
which provided stability, and competition, which provided
better service. The committee considered various proposals
to limit the number of licenses and concluded that most of
them were unworkable because they offered no equitable
way to reduce the number of licenses outstanding or to
reissue them fairly if it should become necessary later to
increase the number of taxicabs. Limitation, the committee
argued, would Inevitably lead to monopoly.
Most of the committee's recommendations were specific.
Manufacturers should be prevented from operating taxicabs;
fleet corporations should be prevented from reorganizing for
the purpose of avoiding liabilities; anyone whose taxicab
had been repossessed should be prevented from ever get-
ting a new license. These recommendations, the committee
felt, would keep unneeded cabs from being driven off the
assembly lines directly onto the streets.
With regard to the drivers, the LaGuardia committee
favored the setting of maximum hours and minimum wages,
the exclusive use of full-time drivers, a central record on
each driver on which terminations would be entered, and an
impartial board to which a driver could appeal what he felt
to be an unfair dismissal.
The Haas Law
When the Board of Aldermen began to consider taxicab
regulation in the fall of 1936, a bill offered by Alderman Lew
Haas gained the most serious consideration. It proposed to
freeze the number of licenses, or medallions, at its then
existing number and, in order to avoid the development of a
monopoly, speCified that those medallions held by fleets and
those held by individuals always had to be operated in those
modes. Every medallion would carry a guarantee of yearly
renewal. Further, the power to set rates would be vested in
4
the City Council (which, as a result of the charter revision
.passed in 1936 to take effect \n 1938, would replace the
Board of Aldermen).
On March I, 1937. the Board of Aldermen passed the
Haas proposal by a margin of 50 to 4. During the debate
over the proposal, no one predicted the rise in the price of
these perpetual licenses. The question of how to increase
their number if needed in the future, a problem that the
LaGuardia committee had felt defied solution, was not con-
sidered. In fact, in the words of one of the drafters of the bill,
"It was a fluke; no one foresaw that these licenses would
ever be valuable."9
The Haas Law is the most
important piece of legislation
passed during the history
of the taxicab industry ....
The Haas Law is the most important piece of legislation
passed during the history of the taxicab industry-although
its greatest impact was not felt until years after its enactment.
Primarily, the law was passed to relieve taxicab oversupply,
which was congesting the city's streets and forcing drivers'
earnings down. The oversupply prior to 1937 is well docu-
mented. In 1930, Mayor Walker's commission had found
that, even during rush hours, 40% of the taxicabs on the
streets were vacant. The most convincing data are the actual
numbers of taxicabs operating in the 1930s. From 1931 to
1933, the number fell (rom 21,000 to 15,500, to 14,000 in
1934, and to around 13,500 immediately prior to the pas-
sage of the Haas Law in 1937.
In guaranteeing perpetual renewability (and transferabil-
ity) of the 13,595 medallions outstanding at the time of its
passage, the Haas Law, in effect, set a ceiling for operating
taxicabs at that number. Yet, foHowing the passage of the
law, the number of taxicabs continued to fall to the current
level of 11,787. This decline occurred because owners who
could not earn a living did not renew their medallions. Thus,
it can be concluded that the continued decline in the number
of taxicabs in the years following passage of the Haas Law
was simply a further market adjustment, which began in
1930, and was quite unaffected by any regulation.
if the Haas Law had altered the relationship between sup-
ply and demand, it would have been unnecessary for a large
group of taxicab owners to reduce their rates in an effort to
stimu~ate demand. Yet, scarcely two months following en-
actment of the law, the Sunshine Radio System, an opera-
tor of 2,400 taxicabs (about 17% of the total in the city),
reduced its rates by one-third-evidence of the law's negli-
gible effect on taxicab supply.
Having had no impact on the problem of oversupply,
how eHective, then, was the Haas Law at remedying the
problems of long hours and low wages for drivers? The law
specified that no driver could work more than 12 hours in
any 24-hour period. Yet, the only way to increase the earn-
Volume 15 Number 2
ADD68
Independent Drivers, and the fleet owners all opposed the
ban. The evidence is unclear as to how well the ban worked,
but Mayor LaGuardia and the City Council. in face of the
industry's 'opposition, did not renew the cruising ban when
the trial period ended.
Overall, seen in the light of the major adjustments to
reduced demand for taxicab service, which began in 1930
and continued through World War II, the Haas Law, while it
correctly identified the conditions of the industry, had little
impact on thern-a sharp contrast to the importance it
would gain a decade later.
Changing Conditions During World War II
and Into the 1960s
During World War II, the combination of a 40% cut in the
industry's gasoline supply and shortages of parts reduced
the number of taxicabs operating in New York City to about
7,500. Needless to say, the profitability of those taxicabs
that continued to operate soared. Moreover, because of the
military draft the reduction in the supply of taxicabs was
accompanied by little, if any, driver unemployment.
The end of World War II brought continued prosperity to
the taxicab industry. Although gasoline rationing ended in
August 1945, the number of taxicabs actually operating in
New York City could not increase dramatically because of
continuing shortages of new taxicabs, replacement parts,
and drivers. It took approximately one year until the number
of medallioned cabs began to bump against the ceiling estab-
lished by the Haas Law.
By 1947, the burgeoning market in the sale of medalilons
came to public attention. [n that year, the medallions were
selling for $2.500 on what public officials were calling the
"black market."11 One city councilman sought to end this
"racket" by proposing a bill that would have made medal-
lions nontransferable. Nothing could have been better de-
signed to arouse an industry that was just learning that
medallions that had initially cost ten dollars were gaining
value. The fleet owners claimed that no other businessmen
were denied the right to sell their businesses for their full
value. As the prices of medallions rose, the prospects for
passage of this proposal diminished. By the mid-1960s,
medallion prices had climbed above $25,000 (see Table 2).
Medallion owners were not the only ones who benefited
from post-World War \I prosperity. Drivers also received
increased earnings, largely through the linking of fare
increases to higher wages for drivers. The City Council,
which was responsible for setting rates under the Haas Law,
•
ings of a driver working on commission was 10 increase the .
earnings of the taxicab. By leaving price unaffected and
allowing,supply to adjusl to the reduced demand. the Haas
Law had no effect on driver earnings.
Another purpose of the Haas Law was to prevent any
firm or firms from gaining monopoly power. Indeed, the
major impetus for the Haas Law was a reaction to Mayor
Walker's plan for a single franchise to operate all the taxi~
cabs. Of course, one way to reduce the threat of any single
interest gaining monopoly power was the law's provision re-
quiring that 42% of the taxicabs then individually owned
must always be individually owned. But in the absence of a
single franchise protected by the government, how real was
the threat of a company gaining substantial power?
Table 1 shows the distribution of fleet size in 1930 and
1935. The table reveals little, if any, change in the degree of
concentration. In 1930, 21.9% of all taxicabs were held by
fleets with 250 or more vehicles. In 1935, this percentage
fell to 19.9%, scarcely a trend toward a monopoly.
Because of their huge financial resources, the fleets owned
and operated by manufacturers represented a potential
source of market concentration and reduced competition.
Yet, the manufacturers' neets declined markedly during the
1930s. In 1930, the Checker Company controlled 3,750
taxicabs (19% of the total) through three subsidiaries, while
in 1935 it operated 2,000 cabs (16%) through one subsid-
iary, the Parmalee Company.IO Another manufacturer, the
Yellow Cab Company, which once operated a fleet of over
3,000 cabs, filed for bankruptcy in 1935.
Oversupply forced General Motors to repossess taxicabs
they had sold to small-fleet and individual owners who found
themselves unable to make their payments. The repos-
sessed taxicabs were incorporated into the General Motors
.subsidiary, Terminal, thus increasing its fleet by 1934 to its
maximum of 1,500 taxicabs. By 1941, Terminal was oper-
ating' only 350 taxicabs in New York City-further evidence
of the limited threat to competition from manufacturer-
operated fleets.
The problem of traffic congestion, also addressed by the
Haas Law, continued into the late 1930s. In March 1938,
the City Council held hearings on the problems of conges-
tion and low driver earnings, but it took no action. How-
ever, in October 1939, the council barred cruising in mid-
town Manhattan for a 30-day trial period. Nearly every
organized taxicab industry group opposed the ban. The
Transit Workers Union, which represented the largest num-
ber of unionized fleet drivers at the time, the Association of
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TABLE 1: NUMBER OF OWNERS AND TAXICABS IN NEW YORK CITY BY SIZE OF FLEET, 1930 and 1935
1 taxicab
2-49
50·99
100-249
250 Or more
Total
Owners -1930
Number Percent
9.257 94.5%
507 5.1
16 0.2
6 0.1
5 0.1
9,791 100.0
Taxlcabs-1930
Number Percent
9,257 47.4%
4,009 20.6
1,048 5.4
925 4.7
4.268 21.9
19,507 100.0
Owners": 1935
Number Percent
5,65597.2%
126 2.2
13 0.2
20 0.3
3 .0.1
5,817 100.0
Taxicab. -1935
Number Percent
5,655 44.9%
1,177 9.4
860 6.8
2.384 19.0
2.502 19.9
12,578 100.0
Sources: City of New York, Report 0/ the Mayor's Commls.lon on Taxicabs, September Z3, 1930; State of New York, Report o/the Joint
Legislative Committee on Taxicab Operation and Fares, March 2, 1936.
August 1980 5
ADD69
CityAlmanac
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development put Mayor Wagner in the awkward position of
attempting to delay a fare increase that would have gone
exclusively to the drivers.
In other words, relative to demand taxicabs were in short
supply, causing longer and longer delays for those seeking
an available taxicab. Thus, the medallioned taxicabs were
faced with a bigger market than they could service, which
enabled them to skim the market, taking only that segment
they found most lucrative. 14 Indeed, in 1964 the price of a
fleet medallion reached $34,000, evidence of the rising
profitability of taxicab ownership.
New ISSU~5 of the 1960s
Regulation of the taxicab industry from 1964 to 1971 in-
tertwines three issues: (1) regulation of the nonmedallioned
"gypsy" taxicabs that began to appear in the city in the early
1960s; (2) the question of which government body could
best manage regulation of the industry; and (3) the proper
relationship between fare increases and driver earnings.
In 1963, reports began to appear about a taxicab shortage
in New York City. The relationship between supply and
demand in the taxicab industry can be examined through
the variable of "live time"-the percentage of time a taxicab
is transporting a passenger. Live time is critical because it
governs the availability of taxicabs. What a passenger pays
for, aside from the ride itself, is the convenience of obtaining
an available cab without an undue wait. As the estimates
below indicate, live time in the 1960s was markedly higher
than in 1949,13
considered three major fare increase requests between 1948
and 1964 and two more in 1968 and 1971. All were nan-
died in a similar manner, although the first was not ap-
proved. The scenario entailed the mayor and the City
Council criticizing the fleet owners, who had requested the
increases, and insisting'that they would approve a fare in-
crease only if it resulted in higher earnings for the drivers.
Each of 'the four increases that were approved did, in fact,
result in higher earnings for the drivers,
In 1948, fleet owners first requested' a fare increase, but it
was not until 1950 that they agreed to raise drivers' commis-
sions from 42.5% to 44% to gain Mayor William O'Dwyer's
support for the fare hike. While the mayor sent the plan to
the City Council in January 1950, the council dropped the
proposal after reviewing financial data submitted, by fleet
owners. Several weeks later, it came to light that the fleet
owners' expense data included a $27,000 item listed "for
the cops." This finding was referred to the Department of
Investigation, which concluded after studying the matter
that, in fact, only $350 had been given to unidentified
policemen while the balance was used to purchase gifts for
employees, vendors, and customers,l2 Nonetheless, a fare
increase was not proposed again until 1952 when the likeli-
hood of its passage was enhanced by tying the proposal
to a 1% increase in driver commissions, bringing the total
commission to 45%.
The next request for a fare increase in 1961 took a rather
ironic turn before it was approved three years later in 1%4.
After the fleet owners requested the increase, Mayor Robert
Wagner appointed a committee headed by former Post-
master General James Farley to recommend ways a fare in-
crease could be structured to result in higher driver earnings.
The committee proposed an increase of ten cents per trip,
with 47% of the additional revenue to go directly to the
drivers, 25% to fund a driver medical insurance plan, and
the remaining 28% to go to the fleet owners. This proposal
was not contested until 1963 when the owners, in an at-
tempt to forestall rapidly advancing driver unionization
headed by Harry Van Arsdale, modified their position and
proposed giving all of the ten7cent raise to the drivers.
Because he wanted to foster the unionization effort, this
Year
1924
1930
1931-42
1949
1961
1967
1970
1973
1978
Live Time per
Ten-Hour Shift
2.63 hours
3.16
1.67
4.80
5.74
5.86
5.52
4.35
5.68
TABLE 2: PRICES OF INDIVIDUAL AND FLEET MEDALLIONS IN NEW YORK CITY, 1947·80
individual Fleet Indivldual Fleet
Year Medallion Medallion Year Medallion Medallion
1947 S 2.500 $ 2,500 1971 $25,000 $10.000
1950 5.000 5.000 1972 30,000 12,000
1952 7,500 7,500 1973 29,000 15,000
1959 19,500 20,000 1974 30,000 18,000
1962 22,000 23,400 1975 37,000 22,000
1963 24,600 27,925 1976 45,000 23,000
1964 26.000 34,145 1977 50,000 28.000
1965 26,000 30,000 1978 55,000 40,000
1966 25,000 18,000 1979 66,000 55,000
1968 25,000 16,000 1980-February 68.000 55.000
1970 28,000 14,000 1980-Seplember 63.000 53,000
Source.: Price Waterhouse and Company, "New York City Fteet Taxicab Industry-Financial Survey," October 23, 1967; City of New
York, Taxi lind Umousine Commission, Internal documents, August 20, 1979; Taxi News. September IS, 1977; New York TIme••
February 16, 1978; interview with Oscar Katz, taxicab broker, August 23. 1979: Interview with Jay Turon. Chairman, Taxi and Limou-
sine Commission, September 3, 1980.
6 Volume 15 Number 2
ADD70
\ CityAlmanac
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Th(:! rising profitability in the early 1960s created the con-
ditions for the advent of the gypsy taxicab, which cruised the
city's !'loorer and outlying neighborhoods that medallioned
cabs avoided. These gypsy taxicabs operated much like their
medallioned rivals, except that the gypsies were virtually un-
regulated. Estimates of their number indicate a phenomenal
growth from 2,000-3,000 in 1964 to over 13,000 in 1971. 15
In December 1965, the City Council passed, but Mayor
Wagner vetoed, a bill that would have prohibited gypsy
taxicabs from using the colors, lettering, or lights used on
medallioned cabs. Community groups from black neighbor-
hoods charged that such a bill would deny them taxicab
service that the medallioned industry had not been supply-
ing. The gypsy taxicab became a symbol as well as a means
of needed transportation. Civil rights leaders and many pub-
lic officials defended the gypsy taxicabs. Representatives of
the medallioned sector attacked them, charging, for exam-
pIe, that many gypsy cabdrivers had criminal backgrounds
and that their rates were exhorbitant.
In September 1966, Mayor John Lindsay appointed a
committee to study the taxicab industry and make sugges'
tions regarding its future regulation. The committee's report,
issued in December 1966, con£irmed that a taxicab shortage
had developed and made recommendations to increase the
supply of service.16 Specifically, the Lindsay committee
recommended shortening the time required to obtain a hack
license, so that the supply of drivers would be increased.
and permitting limited group riding. The committee further
recommended that regulation be shifted to an agency with
broad powers, including the setting of rates, so that the
industry could be operated in the public interest as a "public
utility." The committee also discussed the possibility of issu-
ing additional medallions but concluded that such an action
would be too damaging to those drivers whose medallions
represented an investment of their life savings.
No action was taken on these proposals, and in May 1967
they were echoed in a report by another committee ap-
pointed by Mayor Lindsay and headed by Commissioner of
Investigation Arnold FraimanY In addition to repeating the
recommendation for comprehensive regulation paralleling a
public utility approach, this committee also offered specific
recommendations. Among its proposals were the installa-
tion of bullet resistant shields between drivers and passen-
!;jers and 30-minute timers on rooftop off-duty signs so that
drivers who attempted to turn on the signs temporarily as a
way to avoid stopping for a fare would then have them re-
main on for a half·hour. The Fraiman committee also rec-
ommended that safety standards and minimum insurance
requirements be set for gypsy taxicabs. This recommen-
dation served as de facto recognition of the gypsies.
When the City Council failed to act on the Fraiman com-
mittee's proposals, Mayor Lindsay began to apply economic
pressure. On January 26, 1968, (0110wing a tentative union
contract, he approved a 28.5% fare increase but promised
not to sign any further increases until an agency had been
established to regulate the entire industry. At that time, the
fleet owners' association, the Metropolitan Taxi Board of
Trade and the Taxi Drivers Union went on record opposing
the establishment of such a regulatory agency.11
On July 8. 1968. the City Council passed a bill to sharpen
for the public the distinction between gypsy and medal·
August 1980
Honed taxicabs. The bill provided that all medallioned taxi-
cabs must be painted yellow and that gypsy cabs must carry
the statement: "This vehicle is not licensed to pick up for
hire passengers when cruising." The next day, gypsy cab-
drivers vandalized medallioned taxicabs in Brooklyn.
No further action was taken regarding the setting up of an
independent regulatory agency until Mayor Lindsay was
able to use his authority over rate increases to press for the
change. When the 1970 negotiations between drivers and
fleet owners resulted in an agreement for wage increases
contingent upon approval of a fare increase, the mayor was
in a position to keep his 1968 promise to reject increases
unless a regulatory body was created.
When, in January 1971, the City Council considered a
fare increase proposal, it also had to consider Lindsay's pro-
posal for an independent commission. Labor leaders ap-
peared before the council to argue against the plan for a
taxicab commission, perhaps feeling that such an unelected
body would be less responsive to the needs of drivers than
would the mayor and the City Council. Harry Van Arsdale,
president of the Taxi Drivers Union, testified that the plan
was simply a mechanism to legalize gypsy taxicabs. Indeed,
Calvin Williams, owner of the largest fleet of gypsy cabs
(and a member of the state assembly), testified in favor of
the bill on the grounds that it would bring gypsy taxicabs the
recognition they merited .19 Before the council voted,
Thomas Cuite, the council majority leader, called it the
:'most controversial piece of legislation since rent control."20
On March 1, 1971, the City Council passed a proposal to
set up the Taxi and Limousine Commission and to provide
the funds for a new union agreement by raising rates
42.5%. The commission would supervise licensing, safety
standards, and taxicab design. It would grant fare increases
in response to requests from the fleet owners and the union,
and it would study the problem of the gypsy taxicabs.
The Taxi and Limousine Commission
The Taxi and Limousine Commission consists of a full-
time chairman and eight other members, all of whom are
appointed by the mayor. All members, except the chair-
man, are unsalaried and have staggered seven-year terms.
Five of the eight unsalaried members are apP9inted.on rec-
ommendation of the City Council, to represent the five
boroughs. Passage of any proposal requires the support of a
majority of the commission's members. 21
The first issue on the new commission's agenda was the
gypsy taxicabs. The gypsy owners agreed to submit to safety
standards, meter inspections, and license fees-if, in ex-
change, they received some recognition that would result in
increased revenues. Specifically, they wanted permission to
pick up fares at airports 1md terminals as well as in outlying
areas. The medallion owners felt that any such formal rec-
ognition would cut into their business.
The plan announced by the commission would have
licensed what were called "legal gypsies," those that had
livery licenses, relied on telephone calls for their business,
and carried adequate insurance. The commission would
have established standards for the legal gypsies relating' to
safety. rates, Insurance, and practices; in exchange, these
taxicabs would have been licensed and allowed to pick up
fares in designated areas. The plan would have banned
7
ADD71
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CityAlmanac
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It is important to understand why the individual owner is
Willing to buy a minifleet medallion while the regular fleet
operator is not. Basically, the minifleet and the fleet operate
under totally different cost structures. First, the minifleet
owner has much lower maintenance costs because he is
more careful with his taxicab than is the fleet driver. The
minifleet driver, like the individual medallion owner, has
fewer accidents and, thus, lower repair costs and less time
out of service.
Second, the minifleet owner, like the individual owner,
drives only at the best times. Under the Haas Law, the fleet
owner runs his taxicabs 24 hours a day, 7 days a week. The
Changing Economic Conditions in the 19705
During the 1970s, the medallioned fleets had to contend
with four increasingly troublesome factors. The tirst was
unionization. Since the drivers gained union recognition in
1965, owners have shared authority over whom could be
hired and fired and how many hours drivers would work
(see box, "Unionization in the Taxicab Industry").
Second, the linking 0/ fare increases to wage increases
has meant a higher percentage of fleet revenues are ab-
sorbed by wages. Between 1965 and 1976, labor costs as a
percentage of bookings rose from about 45% to nearly
58%. Further, inflation has pushed the costs of vehicles,
maintenance, fuel, insurance, and interest up dramatically.
Since the process of increasing fares is slow, these rapidly
escalating costs have placed the fleets in a precarious finan-
cial position.
The third factor was the change in the availability of
credit. For many years, fleet owners had been setting up
separate corporations with every two or three medallions
and mortgaging them for the maximum possible amount.
This practice protected the owners from liability claims.
Banks, feeling that medallions were good investments, pro-
vided generous loans. When in 1964, several large fleets
when bankrupt because of insurance claim settlements. the
banks dramatically lowered the amounts they would loan to
fleet owners. Many owners could not provide the equity to
bail the banks out of their investments and, unable to find
other fleet operators to buy their medallions, those in jeop-
ardy created the concept of the "mini/leel," the fourth factor
that characterized the industry in the 1970s.
The minifleet provided a remedy for the changed credit
conditions. Basically, it is a corporation of usually two
medallions owned by two drivers who operate their taxicabs
as owner-drivers. Banks and credit unions are willing to
finance minifleet owners much the same as they do individ-
ual medallions, allowing the medallions to be sold at increas-
ing prices. The estimates below show the rise in the number
of minifleet taxicabs and the decline of those operated by
fleets in the 1970s.22
"outright gypsies" of which it was estimated there were
4,400 in ·the city. These vehicles had no licenses, paid no
fees, and carried no insurance.
The proposal attracted sharp attacks. In January 1972,
owner-drivers' of medallioned taxicabs protested at City
Hall, and in February Harry Van Arsdale and representa-
tives of the fleet owners testified against the bill. In June,
after no progress on the bill, Mayor Lindsay again called for
its passage. Yet by October, no action h~d been taken and
.the proposal appeared dead.
Having lost the battle
to regulate the
gypsy taxicabs, the
Taxi and Limousine
Commission was left with
two· basic functions-
the inspection and
enforcement function
and rate-setting ....
On October 4, 1972, CalVin Williams announced that he
and many other gypsy taxicab owners would no longer vol-
untarily submit to the supervision of the Taxi and Limousine
Commission. Up to that time, gypsy taxicab owners had
cooperated with the commission in hope of eventually gain-
ing some form of legal recognition.
Having lost the battle to regulate the gypsy taxicabs, the
Taxi and Limousine Commission was left with two basic
functions-the inspection and enforcement function pre-
Viously handled by the Police Department's Hack Bureau
and rate-setting heretofore the City Council's responsibility.
Inspection by the Taxi and Limousine Commission has
been criticized by the industry, which claims that inspectors
issue nuisance summonses for petty reasons, and by the
public, which rides in taxicabs that often are in poor condi-
tion. The staff of the commission was cut severly early in the
city's fiscal crisis, and the ability of its remaining inspectors to
monitor the condition of 11,787 taxicabs is very limited.
Rates have been set by the commission much as they
were by the City CounCil. The first increase granted by the
commission, 17.5% in October 1974, had been delayed
until the fleet owners and drivers' union reached an accord
contingent upon a fare increase. After another union con-
tract was negotiated in December 1976. the commission
granted the industry a 13% increase effective in March
1977. In July 1979, in response to another fare increase re-
quest, this one to cover the rising cost of gasoline, the com-
mission granted an additional increase of 15 cents per ride.
This was the first increase in 15 years that did not directly
follow a union contract negotiation.
Year
1972
1975
1976
1977
1978
1979
1980
Minifleet
Taxicabs
o
2,100
2,500
3,800
4,000
4,400
4,700
Fleet
Taxicabs
6,800
4,700
4,300
3,000
2,800
2,400
2,100
8 Volume 15 Number 2
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Unionization In the Taxicab Industry
Because of its size, union organizers have always been
attracted to the taxicab industry. Since each taxicab re-
quires at least two drivers to operate full-time, any union
would experience a sizeable increase in membership by
unionizing the drivers. In addition. the basically unskilled
nature of taxidriving would seem to lend itself to organiz-
ing efforts. Nevertheless, most who have tried to organize
the drivers have encountered major obstacles.
The difficulty arises from a number of factors-disper-
sion of the drivers among many firms spread throughout
the city; fierce competition among drivers for fares; high
turnover in the industry's work force; and the attraction of
the relatively independent nature of driving a taxicab for
those who dislike authority and want to be rewarded for
individual effort.
Between 1915 and 1937, several local unions tried
unsuccessfully to organize the industry. Even the Team-
sters, who tried intermittently between 1915 and 1964,
never succeeded in gaining more than a small foothold.
Beginning in 1937, the Transport Workers Union, under
Mike Quill, achieved industry-wide recognition but al-
most immediately began to lose its power as the fleets
systematically broke the terms of the negotiated contract.
[n 1939, new elections were set, and the TWU won rec-
ognition in only 6 of the 28 fleets. In 1947, the TWU for-
mally revoked the charter of the local that was continuing
to attempt to organize the drivers.
In 1949, John L. Lewis's United Mine Workers mount-
ed a major effort to organize the city's 32,000 drivers. On
April I, 1949, the union called a strike, and 3,000 police
were assigned to prevent Violence that was Widely feared.
Within a few days, the drivers' ranks began to break, and
by April 15, the strike effort had collapsed and with it
Lewis's hopes of adding the 32,000 drivers to his union.
During the 1950s, there were several attempts to organ-
ize the drivers by unions with established underworld
connections. While these efforts were unsuccessful, they
added to the drivers' suspicions of union organizing.
individual owner chooses the best times to operate his taxi-
cab. This increases his revenues, reduces his "dead time,"
and cuts his costs. Finally, the individual owner can operate
outside the tax system more easily by underreporting earn-
ings. Such "skimming" is commonplace. Some people in
the industry estimate that as much as 50% of the individual
operator's income is not reported for tax purposes. Because
of these factors, an individual is willing and able to pay a
large sum to operate as a minifleet.
Beset by these changing conditions, the large-fleet owners
sought a fare increase in February 1980-a request not timed
to coincide with union contract negotiations nor tied to higher
wages for drivers. Instead, it was the result of economic
developments in the industry that threatened the viability of
one sector-the large fleets-while another sector-the
indiVidual owner-drivers-was thriving.
The Taxi and Limousine Commission qUickly voted to
grant apprOXimately a 40% increase and a 50-cent per ride
nighttime surcharge. But when the local media publicized
weaknesses in the data that served as the basis for the com-
August 1980
In 1964, a group of drivers interested in forming a
union enlisted the support of Harry Van Arsdale, head of
the Electrical Workers Union and the Central Labor
Council and one of the city's most respected union offi-
cials. Van Arsdale budgeted $100.000 for the effort and
promised to deploy his organizers among the drivers.
Unlike previous organiZing efforts, he did not accept
union dues from drivers until after the union had gained
recognition.' Van Arsdale also had the support of Mayor
Robert Wagner, who felt the taxicab drivers needed a
union and was not reluctant to state as much publicly. t
On July 21, 1965, after nearly a year of organiZing,
two strikes, and complicated negotiations over the partici-
pation of part-time drivers in the representation election,
a vote was held in 37 garages and Van ArsdaJe's Taxi
Drivers Union won. In December, votes were conducted
in the remaining 42 garages, and the union won in all but
one garage. The union's victory set off a series of wage
negotiations and contracts that resulted in fare increases
necessary to finance the agreements.
In recent years, the union has been significantly weak-
ened by the demise of many large fleets and the related
rise of the minifleets, whose drivers are not unionized.
The fact that the union has such a strong interest in the
survival of the fleets has made them more allies than
adversaries in recent years on a number of fleet-related
issues before the Taxi and limousine Commission. In its
last contract, the union made a major concession to the
fleets by agreeing to allow some union drivers to lease
cabs for a fixed amount per shift rather than be paid on a
commission basis. A continued decline of the large fleets
will certainly result in a continued weakening of the Taxi
Drivers Union.
'Interviews with Joseph Parlldise, Taxi Drivers Union, Janullry 18.
1977; Robert Pancaldo, Taxi Drivers Union, January 28, 1977; and
Harry Van Arsdllle. December 15. 1976.
Hnterview with (ormer Mayor Robert Wagner, August 12, 1976.
mission's decision, the increase was delayed. After reconsid-
ering the request, the commission reduced the increase to
approximately 25% and postponed the nighttime surcharge.
This episode points up the weaknesses in the data on
which the commission makes its decisions as well as the dif-
ference among segments of the industry. The fleet owners
were doing poorly for the reasons discussed above. But the
individual owner-drivers were doing quite well as evidenced
by the soaring price of their medallions, which rose from
$50,000 to $68,000 between 1977 and 1980. In essence,
the commission was allowing itself to be whipsawed by the
needs of the fleets. There are two possible answers to thiS
problem: (1) equaliZing the operating conditions of the
fleets, the minifleets, and the individual owner-drivers
through the alteration of regulations that make fleet owner-
ship uncompetitive, or (2) driving the fleets out of business
altogether so that they are no longer a factor in the rate-
setting process.
Perhaps more important is the problem that arises be-
Continued on page 17
9
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.Service Scorecard-The' Police Department
By Raymond D. Horton and Bruce Warshavsky
While it Is no solace to those New Yorkers who have suf-
fered from crime, New York is not "crime city," at least on a
per capita basis. That unwanted distinction, according to
1979 data compiled by the Federal Bureau of Investigation,
goes to Dallas. New York ranked 13th among the 25 largest
U.S. cities, trailing other Sun Belt cities such as Phoenix,
Houston, Los Angeles, and San Diego.
Still, crime is one of the city's major problems as a matter
of fact and, particularly significant politically, of perception.
Despite mixed evidence on the question of whether changes
in levels of police personnel actually affect crime rates, J
the press, public, and politlcalleaders ritualistically bemoan
the repeated reductions in police manpower that follow
from the city's s'uccessive budget cutting measures. This
Scorecard examines the relationship between changes in
Police Department resources-money arid personnel-and
changes In the level, quality, and efficiency of the depart-
ment's crime.control.
Resources. Between 1970 and 1980, real, or constant
dollar, expenditures (that is, expenditures adjusted for infla-
tion) and employment fell 24% in the Police Department.
The question becomes what effect did these changes in Po-
lice Department resources, particularly employment, have
on the department's services?
Level of Service. No attempt is made here to evaluate
the Police Department's traffic and emergency rescue func-
tions. Rather, we focus on the department's primary mis-
sion, crime control, as measured by arrests. An arrest, ad-
mittedly, is a crude measure of police service but, as stated
in previous Scorecards, conceptualizing and measuring
most public services are difficulte As a measure of. police
service, an arrest has the advantage o( representing a dis-
crete act, one that is conceptually similar to the amount of
refuse picked up or the number of fires extinguished. (At the
same time, an arrest represents, as discussed below, the fail-
ure of the Police Department and other components of the
criminal justice system to deter crime.)
Between 1970 and 1979, the number of arrests by the
police force declined 21 %, a decline nearly equal to those
in money and personnel. However, as the accompanying
table shows, this drop in total arrests resulted entirely from a
27% decline In misdemeanor arrests and a 75% decline in
arrests for violations. Felony arrests actually increased 11 %
during this period. These data suggest that the Police De-
partment adapted to its personnel shortages by changing
its priorities, at least between the apprehension of felons
and of those who commit lesser offenses. The department
increased the number of felony arrests during a period of
work force contraction, particularly after 1975 when police
employment fell most sharply. Between 1975 and 1979.
department employment fell 20%, but felony arrests actu-
ally increased-at least through 1977. In 1978 and 1979.
however. felony arrests declined, suggesting that the depart-
ment had lost its earlier ability to maintain service levels
while losing personnel.
Quality of Service. Measuring the quality of police serv-
ice poses problems at least as great as those in measuring
service levels. The quality of police service is difficult to iden-
tify because the police function represents only one facet of
the criminal justice system. While one might consider an
arrest as the entry point into the criminal justice system, the
high rate of recidivism means that the police apprehend
many persons who represent failures of other components
of the system. Rising crime rates, then, do not stem solely
from the quality of police performance but are related to the
performance of district attorneys' offices, the courts, and the
Departments of Probation and Correction as well.
One measure of quality that skirts this problem somewhat
is the felony arrest rate, this is, felony 'arrests divided by
reported felonies. One drawback of this measure is that ac-
tual crime exceeds repol"led crime. However, if we assume
that the ratio of reported to actual crimes is more or less con·
SELECTED SERVICE INDICATORS FOR THE NEW YORK CITY POLICE DEPARTMENT, 1970, 1975·80
Percent
1970 1975 1976 1977 1978 1979 1980 Change
Real·expendltures·
(In thousands) 5518.1 $614.1 $542.3 $515.2 $458.5 $421.8 $391.9 '24.4%)
Employment 36,749 35,447 30,759 29,264 29.378 28,350 27,805 (24.3)
Arrests - total 250,902 245,125 223,813 230,076 217,564 197,805 n.a. t21.2)
Felonies 94.024 102,390 111,839 115,121 107,135 104,413 n.a. 11.0
Misdemeanors 112.635 84,593 83,522 85.742 87,226 82.222 n.a. (27.0)
Violations 44,243 58,142 28,452 29,213 23,203 11,170 n.a. (74.8)
Felony arrest rate 19.2% 20.8% 20.2% 22.2% 21.8% 19.4% n.a. 1.0
Expenditures per employee $)4,098 $17,325 S17,632 Sl7.606 Sl5,608 $14,879 n.a. 5.5
Felony arrests per employee 2.71 2.89 3.64 3.93 3.65 3.68 n.a. 35.8
Expenditures per felony arrest $5,500 $5,998 $4,849 $4,476 $4,280 $4,040 n.8. /26.5)
Sources: Employment-New York City Office of Management and Budget; all other data-Nelli York City Police Department.
Note: Expenditure and employment data are for the fiscal year; all other data are for the calendar year.
, Adjusted for yearly changes in the New York·Northeastern Nelli Jersey area consumer price inde,,; all real expenditures are In J 967 dollafl;..
10 Volume 15 Number 2
ADD74
CityAlmanac
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stant over time, the felony arrest rate should show trends, if
not precise levels, of service quality.
During the 1970s, the felony arrest rate fluctuated, im-
proving slightly (l %) for the period as a whole. In recent
years, however, the trend has been down-from 22% in
1977 to 19% in 1979-again suggesting that police perfor-
mance has begun to suffer as a result of continued work
force reductions. Arrest rates for misdemeanors and viola-
tions have fallen sharply, further supporting the view that
priorities have changed under retrenchment. In 1979, the
arrest rate for reported violations was less than 4%, about
one-seventh the rate in 1970.
Efficiency. One of the more interesting findings emerg-
ing from our continuing research on the relationship be-
tween municipal resources and services is that fiscal stress
appears to have strong positive effects on the efficiency with
which most services are delivered, that is, the unit costs of
providin~ services, adjusted for price changes, have been
reduced.
In this sense, changes in efficiency are a function of
changes in input costs and output. If other factors are un-
changed, efficiency improves when input costs decline or
output increases (or both occur, which is the optimal situa-
tion). To compute input costs and express them in a stand-
ard unit of analysis, we divided total agency expenditures by
full-time employment to derive expenditures per employee.
This figure is not, it should be emphasized, an indicator of
per employee labor costs, including as it does all agency
operating costs, although labor costs in the Police Depart-
ment, as in most other municipal agencies, are by far the
largest component of total costs.
The trend in real expenditures per employee was up until
1976, when it peaked at $14,632 (in 1967 dollars) and then
turned down sharply, particularly in 1978 and 1979. Be-
tween 1970 and 1979, real expenditures per employee rose
6% as the sharp cuts after 1976 did not negate the ~ubstan
tial increases. prior to that time.
The trend in felony arrests per employee (output) was
substantially different from the trend in expenditures per
employee. Whereas the latter rose during the early 1970s,
thereby dampening efficiency, the former generally moved
up throughout the decade-at least until 1978 and 1979.
Overall, output per employee rose 36% . The combined ef-
fect of changes in expenditures per employee and employee
output was declining efficiency in the 1970-75 period (when
real expenditures for felony arrests rose 9%) and increasing
efficiency in the second half of the decade (when unit serv-
ice costs fell 33%). For the overall period, unit service costs
fell by more than one-fourth (27%).
Implications. Taken as a whole, the data suggest that
substantial work force and, later, expenditure reductions in
the New York City Police Department did not have a sig-
nificant impact on either the quantity or quality of police
services in the 1970s. Moreover, increases in output per em-
ployee throughout the decade and reductions in expendj-
August 1980
tures during the fiscal crisis served to increase markedly the
efficiency of at least the department's crimefighting activities.
In the future, however, it may be more difficult for the
Police Department to protect itself and the public from the
effects of continued financial and personnel retrenchment
because, as a result of prior reductions, the system is now
less flexible than before. In 1978 and 1979, the number of
felony arrests and the felony arrest rate declined and the
number of reported 'felonies rose. Organizational fleXibility
was progressively squeezed throughout the 1970s, presum-
ably leaving the department less able to improve the utiliza-
tion of its resouces to meet increasing demand for its service.
Finally, a word about population changes and crime
rates. Despite a 10% decline in the city's population in the
1970s, the number of reported felonies rose 10%. Over
40% of felony arrests involved persons age 20 or younger,
a group that appears to have declined in number but not
criminal propensity. While population loss takes some of the
pressure off certain city services by reducing demand, this is
not the case for the Police Department. Given the likelihood
that the public sector will not improve (and may well reduce)
its social services under continuing fiscal pressures, the
chances of alleviating the social conditions that give rise to
much of the city's crime rest largely on the extent to which
the local economy can provide jobs to young New Yorkers.
While the local economy in the 1980s should be far stronger
than in the 1970s, employment is not likely to expand sub-
stantially, if at all. And there is reason to question the extent
to which those jobs that do open up will be filled by the seg-
ment of New York City's youth responsible for a high per-
centage of the city's crime.
The outlook, in short, is not bright. Whether it is feasible
or even desirable to increase police resources is not clear.
The best chance the department has of upholding its level of
service probably lies in continuing to reorder its priorities so
that it can direct its maximum effort toward apprehending
those who commit serous crimes and in beginning the seri-
ous managerial reforms that, for th'e most part, eluded the
department in the 1970s-a comprehensive civilianization
program; reduction of leave abuses; and expansion of the
one-man patrol car program, to mention a few examples.
Notes
1. Crime on the city's subways Is apparently more closely related to police
presence than is crime on the streets. Subway crime rose sharply late in
1979 when the number of transit police was reduced and again in 1980
when overtime for transit police was reduced.
2. The efficiency of fireflghling increased in the face of fiscal stress; see
Scorecard, City Almanac,' Vol. 15, No.1, June 1980, pp. 10-11. Transit
services, however, grew less efficient throughout most of the 19705; see
Scorecard. City Almanac, Vol. 14., No.6, February 1980, pp. 8-10.
Raymond D. Horton. co-edltor of Clt}/ Almanac. la A.-oclate Pro-
fessor at the Columbia Unlveralty Graduate School of Bualne.a
and co-dbeetot of the Setting Mllnicipal Prlorltlea Project. Blllce
Wat.hanky I. a allpervlalng budget analyat In the New York City
OKlce of Management and Budget.
11
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CityAlmanac
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Fiscal Update-A Bimonthly Review of New York City Finances
By Terri L. Posner
Since the adoption of the fiscal 1981 budget on June 12,
1980, developments in New York City's finances have been
highlighted by a significant change in the city's approach to
long-term financing, a contract accord. between the city and
the municipal Jabor unions covering fiscal 1981 and 1982,
and a disruption of the usual adoption process for the four-
year financial plan. The city now ~as an approved financial
plan covering fiscal 1981-84, and the U.S. Secretary of the
Treasury has recently approved the use of standby federal
loan guarantees contemplated in the financing plan.
Collective Bargaining Settlement
When the city submitted its four-year financial plan to the
Financial Contrc;1 Board (FCB) on May 12, 1980, for fiscal
1981-84, negotiations between the city and its municipal
labor unions had recently begun. On June 19, 1980, the city
and the coalition representing the majority of city employees
tentatively agreed to terms for a two-year contract, and the
true scope of the settlement became known.
The major provisions of the agreement included a general
wage increase in both fiscal 1981 and 1982 of 8% or $900,
whichever is greater; cash payments of $750 per year for
each eligible employee based on service rendered in fiscal
1980; the incorporation of the cash payments into base sala-
ries as of June 30, 1982; and increases totaling $450 per
employee in the cily's contribution to the union welfare
funds. The total cost of the agreement, including pension
and fringe benefit costs, was estimated to be $1.477 billion.
The city reached a tentative agreement with the uni-
formed coalition, representing approximately 50,000 em-
ployees, on July 3, 1980. The major provisions of the
agreement included general wage increases of 9%, effective
July 1, 1980, and 8%, effective July I, 1981; cash pay·
ments of $750 annually for eligible employees based on
service in fiscal 1980; the incorporation of the cash pay-
ments into base salaries as of June 30, 1980; an increase of
$50 per employee in the city's contribution to the union wel-
fare funds; and additional uniform allowances of $100 in fis-
cal 1981 and $200 in fiscal 1982 for each employee. The
total cost of this agreement, including pension and fringe
benefit contributions, was estimated to be $512 million.
The incremental costs of both agreements totaled $1.989
billion, of which $1.621 billion represents city funds. The
city assumed the remaining costs would be reimbursable
through increases in state and federal aid as occurred in the
past. The cash payment portion of the labor settlement,
which the city designated as being for services rendered dur-
ing fiscal 1980, will be charged back to fiscal 1980, a practice
that has been sanctioned by the city's outside auditors. Dur-
ing that year, the city accumulated a collective bargaining
reserve of $327 million for this purpose. However, the city
also intends to charge the added costs of the uniform allow-
ances to fiscal 1980. In a report on the agreements, the
Office of the Special Deputy Comptroller (aSDC) observed
that the charge-back of these costs does not appear to com-
12
ply with generally accepted accounting principles (GAAP).I
. The proposed charge-back of the costs of the uniform allow-
ances is now being considered in the year-end audit.
The provisions of the tentative settlements substantially
exceeded the funds the city put aside in the adopted budget
for fiscal 1981 for a wage increase of approximately 5%.
The city estimated that the additional costs of the settlement
not yet provided for within the adopted budget were $168
million for fiscal 1981 and $550 million for fiscal 1982.
The Bridge Financial Plan
In a letter dated June 25, 1980. the city's budget director-
noting that the City had not provided for the yet to be deter-
mined costs of the labor settlement-withdrew the financial
plan that had been submitted on May 12, 1980, to the FCB.
The Financial Emergency Act provides that if the FCB has
not approved a financial plan, it is required to formulate and
adopt one that remains in effect until it does approve a city-
submitted financial plan. On June 26, 1980, the FCB
adopted the Bridge Financial Plan, which provided interim
operating authority for the city and the Board of Education
for the filst quarter of fiscal 1981 and for the other covered
organizations through the entire fiscal year. The FCB's ac-
tion was without precedent since its creation in 1975.
The Bridge Financial Plan reflected the revenue and ex-
penditure levels of the city's adopted budget with two excep-
tions: (1) it contained no funds to cover the costs of collec-
tive bargaining agreements yet to be formally entered into by
the city, and (2) it reflected the first-quarter impact of a
series of measures estimated to save $160 million in fiscal
1981 and $260 million in fiscal 1982.2 In a report issued on
July 24, 1980, OSDC noted that $115 million of the $160
million of savings in the Bridge Financial Plan were not spec'
ified. Further, OSDC said the city had not implemented
internal controls to ensure compliance with the quarterly
expenditure ceilings of that plan as required by the FCB
resolution adopting the plan. J In adopting the Bridge Finan-
cial Plan, the FCB resolved that the city's revised four-year
plan, to be submitted on or before August 15, 1980, would
have to itemize the actions to be taken to close the budget
gap then projected for fiscal 1982.
The Four-Year Financial Plan
The city submitted a revised four-year financial plan on
August 11, 1980, which projected a budget balanced ac-
cording to GAAP in fiscal 1981 and budget gaps of $733
million in fiscal 1982, $1.259 billion in 1983, and $1.312
billion in 1984. On September 18, 1980, the FeB approved
the city's plan with some added contigency measures. At
that time, the FCB also approved both municipal labor con-
tracts covering fiscal 1980-82.
Fiscal 1981. The major changes in the city's proposed
plan for fiscal 1981 from the adopted budget included in-
creased labor costs of $168 million resulting from the settle-
ments and the elimination of $100 million of anticipated
Volume 15 Number 2
ADD76
CityAlmanac
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federal aid. The city offset the impact of these changes pri-
marily through additional tax revenues of $181 million,
resulting from increased real estate tax revenues of $35 mil-
lion and revised tax forecasts of $146 million; increased
unrestricted aid of $118 million, including new state aid of
$70 million; and additional expenditure reductions of $87
million, which helped to orfset the impact or the increased
labor costs. Offsetting these revenue increases and expendi-
ture reductions, however, were new expenditure needs of
$26 million and a shift from fiscal 1981 to 1982 of $55 mil-
lion in proceeds from the sale of Educational Construction
Fund (ECF) bonds. As a result of these and other minor
revISions, total projected revenues and expenditures in-
creased by $108 million (Table 1).
In reviewing the fiscal 1981 financial plan, OSDC con-
cluded that the prospects for a balanced budget in that year
were good.4 Although there are potential uncertainties with
respect to anticipated state aid, revenues from the Westway
right-of-way sale, and the proposed increase in the real
estate tax rate, several factors could mitigate the impact of
these uncertainties. In particular, OSDC noted the availabil-
ity of the budgeted general reserve, a continuation of
higher-than-forecast local revenues, and management deci-
sions to contain spending below planned levels.
TABLE 1: SUMMARY OF OSDC AND FCB STAFF REVIEWS OF THE NEW YORK CITY FINANCIAL PLAN
BASELINE ESTIMATES FOR FISCAL 1981 ($ in millions)
FCBComment
No substantial difference noted.
No subslllntilli difference noled.
No substantial difference noted.
A~ailllble 10 offset potential risks.
Failure to realize full $413 million
of overall expendilure reduction
assumed in plan creates a polen-
till' risk of $139 million; how-
e~er, polentilll underspending of
$62 million could offset most of
risk: Board of Education may ex-
perience some cost overruns
since last year's fiscal problems
hll~e not been o~ercome.
See comment above.
Potential delay In receipt of
Westway revenues.
Potential loss of $49 million of
slate revenue-shllring funds.
Not applicable.
No subslllnlial difference noled.
No substantial difference noled.
No substanlial difference noled.
No substantial difference noled.
No substantial difference noted.
Potential slippage of $17 million
from property till' revenue en-
hancements.
Tax receipls likely to exceed pilln
by $130 million.
OSDC Comment
Public and medic III assistance
costs mllY exceed plan as result
of economic downturn and re-
cent court decisio(l; judgmenls
and c1111ms may be underspent
by $10 billion; some under-
spending may occur.
No subslantial difference noted.
No subslantial dlHerence noled.
A~allable 10 offset expenditure
overruns.
No substantial difference noted.
Additional funding milY be re-
quired for Correction, Fire, Po-
lice, and Sanitation, if assumed
savings are not realized; addi-
llonal savings possible if vacant
positions are not filled as as-
sumed in plan.
Real eslate IlIX rate change to
provide $35 million of revenue
needs leglsillti~e lIpprovlll.
Tax receipts, mostly from stock
transfer lax, likely 10 exceed plan
by $97 million.
Westway revenue of $100 mil-
lion is uncerlain.
State aid totaling $123 million is
uncerlain.
Not lIppllcllble.
No substantial difference noted.
No substantial difference noted.
No substantial difference noted.
No substantial difference noted.
No substantial difference noted.
6
9
15
110
(30)
118
(172)
($127)
(4)
S 108
$ 71
Better
(Worse)
1,457
248
100
5,726
1,364
998
3,886
$ 6,509
63
2,174
2,331
(35)
(345)
$13,695
$ 3,259
August 1980
Submission
1,463
248
100
5,735
1,394
880
3,776
$ 6,382
172
63
2,174
2,316
(35)
(341)
$13,587
$ 3,188
Adopted
Budget
City debt service
MAC debt service funding
Generlll reserve
Other-lhlln-personal service
Other til xes
Unrestricled intergovernmental aid
Miscellaneous revenues
Anlicipaled revenues'
Interfund agreemenls
Federll] calegorical grants
State calegorical gran Is
Less: Reserve for disallowances
Intracity revenues
Revenues-total
Expenditures
Personal ser~ice
Less: Intracity expenditures (341) (345\ 4
Expenditures-tolal $13,587 $13.695 ($108)
Sources: See lexI notes 3 and 4; New York City Rnandal plan, August 11, 1980.
"Anticipated state aid of $72 million ts Included elsewhere In the plan; anticipated federal aid of $100 mlllion was eliminated.
Category
Revenues
Gen.m:>I property tllX
August 1980 13
ADD77
CItyAJrnanac
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The FCB's staff review of the proposed plan also reflected
a favorable assessment of the city's ability to attain a GAAP
budget balance in fiscal 1981, noting that the city continues
to benefit from a strong local economy.s The review cau-
tioned, however, that the planned inclusion of $87 million
of incremental expenditure reductions, when added to $326
million of. reductions already in baseline expenditure esti-
mates, aggregate over $400 million, which city agencies
may have difficulty accommodating during the year.
Both the OSDC and FCB staffs have identified potential
risks in the. covered organizations, most notably the Health
and Hospitals Corporation and the Board of Education,
which could further strain clty resources. Overall, while both
monitoring agencies project that the city can attain its finan-
cial goal in fiscal 1981 , their concern continues to be focused
on the prospects for recurring balanced budgets.
Fiscal 1982. The projected gap of $733 million for fiscal
1982 is only $164 million greater than the gap projected in
the May 12, 1980, plan submission-even with the inclusion
of $550 million of costs related to the labor settlements and
the elimination of $100 million of anticipated federal aid.
The city partially offset the impact of these changes through
additional tax revenues of $344 million, resulting from. in-
creased real estate tax revenues of $185 million and revised
tax forecasts of $159 million; increased miscellaneous reve-
nues of $91 million, including $61 million of ECF bond pro-
ceeds; new state aid; and additional expenditure reductions,
which helped offset the increased labor costs. The combined
effect of these and other changes raised revenues by $326
million and expenditures by $490 million (Table 2).
The baseline revenue estimates for fiscal 1982 now in-
clude $110 million of increased real estate tax revenues from
increased real property assessments as well as $75 million
from the impact of the proposed increase in the real estate
tax rate. The OSDC staff review concluded that the entire
amount of the increased real estate tax revenues for fiscal
1982 was uncertain since both components of this additional
revenue require enabling actions outside the city's control.
OSDC noted that the real estate tax rate increase must be
approved by the City Council, which rejected a smaller
increase in June. The chairman of the council's Finance
Committee recently indicated, however, that the council
may shortly approve the property tax increase assumed in
the city's plan. The realization of the enhanced revenue
from increased real property assessments, however, would
require improved assessment procedures and a favorable
determination by the state Board of Equalization and
Assessment on the city's request that the board retroactively
revise the calculation of real property growth rates for New
York City. A separate OSDC report concluded that, while
New York City depends more on real estate taxes than on
any other source of local tax revenue, the city has sustained
TABLE 2: SUMMARY OF OSDC STAFF REVIEW OF THE NEW YORK CITY FINANCIAL PLAN
BASELINE ESTIMATES F9R FISCAL'1982 (5 In millions)
Adopted August 1980 Better
Catego~ Budget' Submission (Worse) OSDC Comment
Revenues
General property tax $ 3,270 $ 3,498 $ 228 Favorable rulings by state Board 01 Equalization and Assessment and
City Council on increased assessments and tax rate required for $185
million 01 increased revenues.
Other taxes 3,909 4,025 116 Revenues may exceed plan by $41 million.
Miscellaneous revenues 1.231 1,322 91 Increase due mostly 10 shift 01 $61 million 01 ECF proceeds; Westway
revenues of $100 million could also be delayed until Iiscal 1982.
Unresl11cted intergovernmental aid 809 885 46 Stale aid of $46 million Is uncertain; but excess revenues of $137 mil·
lion may be received \I state revenue-sharing "cap" is not reenacted.
Anticipated revenues t 172 (172) Not applicable.
Interfund agreements 63 63 Reasonable estimate.
Federal categorical aid 2,200 2,202 2 Reasonable estimate.
State categorical aid 2,377 2,396 19 Reasonable estimate.
Less: Reserve for disaliowlInces (35) (35) Reasonable estimate.
Intracily revenues (342) (346) (4) Reasonable esllmate.
Revenues-total $13,654 $13,980 $ 326
Expenditures
Personal service $ 6,545 $ 7,044 ($499) Additional funding of $35 million may be required lor special education.
Other-than-personal service 6,075 6,076 11) Public and medical assistance costs may be exceeded because of
economic decline and recent court decision; energy savings of $18
mil/lon may nol be realized; underspending may offset some risks.
City debt service 1,343 1,337 6 City and MAC debt service costs overstaled by $51 million.
MAC debt service funding 502 502 See comment abovl!.
General reserve 100 100 Available to offset expendllure overruns if not eliminated as proposed
In PEG.
Less: Intracity expenditures (342) (346) 4 Reasonable estimate.
Expenditures - total $14,223 514.713 ($490)
Gap 10 be closed ($569) ($733) ($164) Gap estimate understated by $342 ml11lon.
Sources: See text note 3; New York City financial plan. Augusl II. 1980.
'The linancial plan for liscal 1982 as It existed at the time the budget was adopted for fiscal 1981 (May 12. 1980. plan submission).
fAntlclpaled state aid of 563 million Is Included elsewhere In the plan; anticipated federal aid of $100 million was eliminated.
14 Volume 15 Number 2
ADD78
WLIlQ'ii' "millilli'" liiiiiiili""""!Iiiiiiiiiiitlllilii!li'iiiililiilll!ll!l,iiliiiiiiiiiiiiiiiiiiiiiliil'''''''iiillliililllll"",nl'''''i1i1illliilllilllilliliii!iili'"l11iiiiiiliij'''''''ii'iiiliii'W"i1iii,iiiiiilliiiiil,'"liWI'ii111""'Wiimiiiilii""""tIi'liji
QtyAlmanac
Financing
The city's financial plan for fiscal 1981 assumes the city
will need $600-$800 million of short-term financing during
the year_ In fiscal 1980, the city entered into an agreement
with 40 banks to provide backup financing in the event that
the city could not market its notes as required. The city actu-
ally utilized only a small portion of this backup financing as
its note sales were largely successful, and financing needs
were lower than assumed during fiscal 1980.
For fiscal 1981, a similar agreement was recently negoti"
ated and approved by the FCB on October 1, .1980. The
loan agreement for fiscal 1981 also involves 40 banks and a
total of $700 million, with interest rates from 71/2%-101/2%
of the plan. 7 Federal aid projected in the PEG totals $200
million in fiscal 1982, 27% of the PEG, but increases to
$710 million in 1984, 54% of the planned PEG.
Although the city's plan details a number of federal ac-
tions that could aid the city, it is clear that the bulk of the aid
is expected to come from medicaid reform as proposed in
Senator Daniel Moynihan's bill (S. 2073). The city's fiscal
monitors, while supporting medicaid reform, have termed
the city's expectations of federal aid as, at best, optimistic
and, at worst, unrealistic. Further, half of the estimated sav-
ings the Moynihan bill could produce represent savings to
the state that may not be passed along to the city.
Standby and Contingency Programs
Since reviews of the city's plan submission identified sig-
nificant risks for fiscal 1982, the city agreed to develop a
standby program of expenditure reductions, which would
be implemented in fiscal 1981 to save $100 million in fiscal
1982, and to detail a previously unspecified contingency
program of $200 million in fiscal 1982.
The $100 million standby program consisted of personnel
reductions-3,800 layoffs and 2,900 positions from a 75%
hiring freeze. Mayor Koch stated in his transmittal letter that
the standby program represented the scope of the actions
that, if necessary, could be implemented beginning in Janu-
ary 1981 and stressed that he did not believe that the pro-
gram would be required. The city's plan submission in Jan-
uary 1981 may contain similar actions to provide saVings in
fiscal 1982 if events indicate they are needed.
The contingency program included $188-$226 million in
new or increased taxes and $50 million in incremental ex-
penditure reductions. Based on its review of the financial
plan, the FCB staff recommended approval of the revised
plan, stating that, with the standby and contingency pro-
grams, the fiscal 1982 budget gap was "manageable."7
In a statement issued at the meeting during which the
FCB approved the plan, Comer Coppie, the executive
director of the control board stressed that while the board
was approving a financial plan for fiscal 1981 through 1984,
only fiscal 1981 and 1982 had been meaningfully addressed
by the city. Mr. Coppie stated that to maintain a recurring
budget balance the city must focus on strategic programs
that will have an impact on all four years of the financial
plan. Mr. Coppie's statement underscored the magnitude of
the projected budget gaps for fiscal 1982 and 1984 and the
concern of tne city's fiscal monitors that it has failed to pro-
vide long-range comprehensive plans to close those gaps.
revenue losses of several hundred million dollars in the last
few years, attributable in part to the inadequacy and in-
equity of current assessment procedures.6
Because the city's proposed plan for fiscal 1982 reflects
the impact of actions to be initiated in fiscal 1981-many of
which are uncertain-the OSDC staff included in its review
of the plan a restatement of the fiscal 1982 budget gap
projected in the city's plan, which OSDC estimated is
$1.075 billion. The difference between the OSDC and city
estimates, $342 million, consists of $185 million in new
property tax revenues, $93 million in expenditure reduc-
tions, and $63 million in state aid, all of which OSDC con-
sidered to be uncertain.
Program to Eliminate the Gap
In order to close projected budget gaps for fiscal 1982-84,
the city proposed a program to eliminate the gap (PEG)
consisting of various city, state and federal actions to be initi-
ated in fiscal 1982, the value of which is assumed to recur
through fiscal 1984.
Expenditure reductions. Incremental expenditure reduc-
tions of $133 million, r~presenting 18% of the city's PEG
actions, are planned for fiscal 1982, including a 4% attrition
program in the mayoral agencies (other than the Board of
Education) and savings in the Board 01 Education from
enrollment declines. The FCB's review concluded that one-
third of these reductions were not sufficiently justified to be
considered attainable.
Revenue enhancements. The city has outlined potential
actions to enhance revenues by $134 million, or 18% of the
PEG actions for fiscal 1982. These actions include additional
revenues from the expansion of Off-Track Betting Corpora-
tion activities, acceleration of real estate tax collections on a
semiannual, rather than a quarterly, basis, and improved
collections of water and sewer charges. Of these actions,
$97 million are not within the city's control to implement as
they require the state legislature's approval, which may be
difficult to obtain.
Other actions. The city's PEG also includes a tax reduc·
tion of. $20 million from the elimination of three minor busi-
ness taxes and debt service saVings of $50 million from
various actions the Municipal Assistance Corporation
(MAC) could take to reduce its funding requirements. The
city also proposes to eliminate the statutory budgeted gen-
eral reserve of $100 million and, instead, to create a contin-
gency cash reserve. These actions total $130 million, or
18% of the PEG. The city has recently gained favorable
opinions from its counsel and financial adVisor regarding the
legality of the cash reserve proposal; however, the FCB has
postponed final consideration of the proposal until January
1981. Members of the financial community have expressed
concern regarding the perception of the reserve proposal by
credit markets.
State and federal aid. The city's PEG projects state aid of
$136 million to help close the gap. Projected state aid in the
PEG Srows significantly through the plan period, to $283
million in fiscal 1984. In a recent letter to the executive
of the FCB, the deputy director of the state Division
of the Budget indicated that while state aid levels assumed in
plan are relatively assured through fiscal 1982, no assur-
can be given at this time with respect to the later years
August 1980 15
ADD79
CityAlmanac
iI"'''' iiiiliii'iiiillii""i1hiitiliiil" """" " iii iiii"'""iii iiillii iiii ill ii " "" "''' """i1iil""" iii Iii iiiiill! 'liiii,mimii'''''''''''''' """''''III''' "iiiiiiii!i!""''''iih''!iiiii!'i!lihi!!iiiilliiiliii!''ii''i1ili'''''''11
.TABLE 3: REVISED FINANCING PLAN FOR TH~ CITY OF NEW YORK. Fiscal 1981·85 ($ in millions)
1981 1982 1983 1984 1985 Total
Requirements
Oty capital :$ 712 $ 975 $1,000 $1,000 $1,000 $4,687
MAC reserve & guaranty lunds 75 100 100 100 375
MAC refunding 100 150 250
Requirements-total 5 887 $1,225 $1,100 $1,100 $1,000 55,312
Sources
City bonds
Guaranteed private placements 300 600 900
Unguaranteed public sales' 100 200 300 400 700 1,700
MAC bonds
Private placements 537 325 862
Public sales 400 400 400 350 300t 1,850
Sources- total 51.337 51,525 700 750 11.000 15,312
Reserve for future capital
requlrements-(deposlts)/withdrBwals (450) (300) 400 350 1.000 0
Total for current requirements 5 887 51.225 51,100 $1.100 $1,000 55,312
Source: Presentation to the Hon. G. Wllffam Miller, Secretary o( the Treasury, by the'City of New York and the Municipal Assistance Corporation
for the City of New York, September 10, 1980.
'To the extent city bond sales to the public vary &om the Indicated schedule, MAC Issues may be adjusted accordingly.
ITo be issued during the Hrst six months o( fiscal 1985.
(1 % higher than last year) based on the federal funds rate
on the closing day of each note sale. The notes mature in
April, May, and June against state per capita aid for educa-
tion. The city's first note issuance under the agreement is
tentatively scheduled for mid- to late-November, coinciding
with the city's cash needs.
Since May, the city's long-term financing plan has under-
gone a significant change. The current plan, which provides·
the funding required for the four-year capital plan approved
by the FCB on September 18, 1980,. calls for the use of
$900 million of standby federal loan guarantees during fiscal
1981 and 1982, an increase in MAC's borrowing authority,
and a more gradual approach by the city to gaining full ac-
cess to the public credit markets. As was contemplated in a
similar MAC proposal made public in June, the city would
commence funding all of Its capital needs through public
sales of its own bonds during the second half of fiscal 1985.
The new financing plan anticipates that the city will issue
$900 million in guaranteed city debt to the city and state
pension funds and publicly sell $300 million of its own
bonds during fiscal 1981 and 1982. During those years,
MAC is expected to sell $862 million of its bonds privately
and $800 million publicly. The availability of standby guar-
antees in fiscal 1981 and 1982 would allow MAC to escrow
$750 million of the proceeds from its aggregate issuances in
order to ensure the financing of the city's capital needs of $1
billion annually in fiscal 1983 and 1984. The remaining
financing for fiscal 1983 and 1984 is to be provided by sales
to the public of $700 million of city bonds and $750 million
of MAC bonds, supplemented by withdrawal 01 an addi-
tional $750 million of escrowed proceeds (Table 3).
Since this new financing proposal was advanced to the
U.S. Treasury, Senator William Proxmille, chairman of the
Senate Committee on Banking, Housing and Urban Affairs,
attempted to prevent the issuance of standby guarantees by
attaching language, which would have precluded issuance
of the guarantees as long as MAC retained market access, to
a Senate continuing resolution. However, the version of the
16
resolution passed by the House of Representatives, with the
endorsement of President Carter, did not include Senator
Proxmire's amendment, and the congressional obstacle to
the guarantees was eliminated.
Thus far in fiscal 1981, MAC has sold $100 million in
bonds to the public, maturing at dates ranging from 1982 to
2008 and with interest rates varying from 61j2 % to 9314 % ,
and has concluded a private bond sale of $300 million at
an interest rate of 103/4 %. The purchase of $300 million in
guaranteed city bonds by municipal employee pension
funds, pursuant to the fiscal 1981 financing plan, was com-
pleted on October 2, 1980, the day the documents authoriz-
ing the guarantees were transmitted to the city by the Secre-
tary of the Treasury.
Notes
1. New York State Deparlment of Audll and Conirol , Office of Ihe Special
Deputy Comptroller for the City of New York. "Report on the Proposed
Municipal Coalition Economic Agreement {or 1980-1982," Report No.
22·81, September 16. 1980, p. 16
2. New York State Financial Control Board, "Stal! Report on the Bridge
Financial Plan," June 26. 1980, p. 4.
3. New York Slate Department 01 Audit and Control, Office of the Special
DepulyComplroller for the Cily of New York, Leiter Report No. 27-81,
July 24. 1980, p. 4
4. New York Slale Deparlment 01 Audil and Conlrol. OHice of the Special
Deputy Comptroller for the Cily of New York, "Review of the Proposed
New York City Financial Plan of August 11, 1980, for Fiscal Years 1981
through 1984," Report No. 35-81, September 16. 1980.
5. New York Slale Financial Control Board, "Staff Reporl on the Proposed
Financial Plan for Fiscal 1981-1984." September IB, 1980.
6. New York State Department 01 Audit and Control, Olliee 01 the Special
Deputy Complroller for the City of New York, "Real Estale Assessment
Practices in New York City." Report No. 31-81, August 8, 1980, pp. v-vi.
7. Leiter Irom C. Mark Law/on, Deputy Director, New York State Division
of the Budget, to Comer S. Coppie, Executive Director, New York State
Financial Control Board, September 11, 1980.
B. New York Slale Financial Control Board, "Staff Report on the Bridge
Financial Plan."
Tenl L. Posner Is the New York City Expense Budget Analyst for
the Municipal Assistance Corporation.
Volume 15 Number 2
ADD80
ADD81
~-------------_ .._.- -'--'-
!iii"""
OtyAlmanac
iiii""Wililiiiiii"m"""""""""",miili ''''''ii'iii,iiiiiliiiiiiiiiii'hiiiiliiiii''''''ii1!iiiijl"""m "'''''''11''''''11 iiiiiiili"""iih Iii"".." ,,"""""""""" """""",,"'''' !III'
who lease their cabs already operate around the clock. The
only taxicabs that are not now operated for two shifts are
individual medallioned cabs and minifleet vehicles that are
operated by their owners in the. same way as individual
medallioned ·cabs. The. owner-drivers maximize their earn-
ings by working long hours, including the most lucrative
hours of both the day and night shifts. They operate for
most of the hours during which anyone could profitably
lease their cabs. Further, most owner-drivers want to avoid
the problems that accompany sharing their cab with another
driver. Thus, if these owner-drivers are induced to work
more hours at night it will only be at the expense of their
working during the day. A nighttime differential will only in-
crease the supply of taxicabs at night by creating a compar-
able reduction of service during the day.
Gypsy taxicabs. Since their appearance in the early
1960s, gypsy taxicabs have grown steadily in number to
the current level of 40,000 full- and part-time vehicles.2J
Although it is illegal for gypsy cabs to accept passengers who'
hail them in the street, this Jaw is violated thousands of times
each day, and the police rarely give summonses for viola-
tions. Because medallioned taxicabs concentrate in Manhat-
tan south of Harlem. at airports, and in middle-class resi-
dential areas, one can estimate that, for many New Yorkers,
gypsy taxicabs provide the only available cab service.
It is reasonable for the people served by gypsy taxicabs to
expect some of the protection afforded by regulation of me-
dalJioned cabs. These guarantees include adequately insured
vehicles, accurately calibrated meters, properly licensed
drivers, and some disciplinary recourse for passengers who
have been mistreated.
The experience of the last
fare increase demonstrates
the weakn~ss of the data
on which the Taxi and
Limousine Commission
bases its decisions.
The Taxi and Limousine Commission sought such regula-
tory authority when it was created in 1971 but lost the battle
because of the opposition from medallion owners. The com-
mission currently has a proposal for limited regulation of the
gypsy taxicabs, but it falls far short of what the riding public
deserves. The proposal would regulate gypsy taxicabs in the
same way as limousine service. This requires only that the
operators register their rates with the commission, but it
does not subject the rates to regulation nor does it establish
safety standards.
Fore Increases. The experience of the last fare increase
demonstrates the weakness of the data on which the Taxi
and Limousine Commission bases its decisions. While the
fleet owners maintain accurate data as a result of the com-
mission system and Internal Revenue Service requirements,
they now account for fewer than 18% of all medallions.
18
Owner-drivers and minifleets keep scant records and, as a
rule, grossly underestimate their earnings.
In making its last fare increase decision, the commission
stated that it did not consider the data submitted by the
owner-drivers' group. In other words, the commission made
a decisio'n to give an across-the-board increase to the entire
industry based on the needs of one segment, which, for rea·
sons explained above, operates under extremely disadvan-
tageous conditions. All evidence, from the rise of minifleets
to the prices paid for medallions, confirms this. It would be
better for consumers if, as noted above, the commission
changed the regulations that make fleet operation disadvan-
tageous or if it allowed the fleets to cease operating com-
pletely. Then the commiSSion could make rate decisions for
an industry with uniform cost and revenue structures. How·
ever, this seems unlikely because the surViving fleets will
continue operating and not be forced out of business. Con·
sequently, the public faces a continuing series of fare in·
creases resulting from the fact that the Taxi and Limousine
Commission is whipsawed by the needs of only one seg-
ment of the industry ..
A more reasonable method than the one currenlly em-
ployed by the commission to set fares would be to lie in·
creases to decreases in the price of the medallion.l'he price
of the medallion is a readily available and accurate measure
of the profitability of the taxi industry. The price individuals
have been willing to pay for a medallion has been steadily
rising, reflecting the steadily rising profitability of taxicab
operation for owner-drivers and minifleets.24 The fact thai
fleets are unwilling to pay that price Is the result of their sub-
stantially lower profitability.
Using medallion prices to gUide fare changes would elimi·
nate th\'! rachet effect under which, in the past, a rise in the
price of the medallion has been a major cost increase and,
hence, a justification for a fare increase. It would lie in-
creases in the fare to a valid measure of profitability. Such a
system might reduce the medallion price and, in the long
run, reduce debt in the taxicab industry while making it
more financially stable.
Valid Areas for Regulation
in the Public Interest
Clearly, limiting the number of taxicabs has proved to be a
costly and unjustified form of regulation. The cost of limiting
the number of medallions is reflected in their current total
value of $660 million. Since medallions were virtually free
when first issued and current prices reflect their profitability,
this sum represents a direct transfer from consumers to
medallion owners.
Showing that the major- effect of regulation has not been
in the public interest does not mean there is no role for regu-
lation of the taxicab industry. To serve the public interest.
regulation needs to focus primarily on four areas.
The fare. Regulation of fares has been discussed in the
previous section where it was proposed that fare increases
be linked to decreases In the price of medallions. In addi-
tion. it is now appropriate to return from the current fixed
rate structure to a maximum fare rate-the system that pre-
vailed unlil 1934. .
Up to that time, taxicabs were allowed to charge any
amount below the maximum rate. Thus, smaller taXicabs
Volume 15 Number 2
ADD82
I CityAlmanac
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charged less, and rates at off-peak times were lower. A
return to this system would serve consumers by encouraging
greater diversity of service and by offering reduced rates at
certain times of the day. It would also serve taxicab opera-
tors by guaranteeing them higher utilization and more total
revenue than they now have under the fixed fare system.
Driver qualifications. The licensing of. drivers is now a
screening process designed to eliminate those applicants
with criminal records and, more recently, immigrants with-
out work permits or "green cards." Unquestionably, this is a
proper area for public regulation, but a thorough knowledge
of the city's geography should also be required. Unfortu-
nately, the Taxi and Limousine Commission has allowed a
system of "on-the-job" education to develop. Making
knowledge of the city a prerequisite for obtaining a hack
license would not only improve the quality of service, it
would also foster greater occupational pride among drivers
who would know that not just anyone could drive a taxicab
in New York City.
Vehicle safety. Safety should continue to be a major
focus of regulation. Most owner-drivers carefully maintain
their taxicabs in an attempt to avoid accidents due to me-
chanical failure not only to reduce repair costs but also out of
an understandable concern for their own safety. Fleet taxi-
cabs, in part because the fleets are only mar'ginally profit-
able, are the major source of unsafe vehicles.
In connection with the question of safety, it should be
noted that, under current regulations, the only types of vehi-
cles that can be operated as taxicabs are mid- and full-size
sedans, Owners should have more discretion in choosing
the types of automobiles they operate, The resulting greater
variety of service would benefit consumers substantially. It
would reduce the costs of operation, street congestion, and,
if the fare were allowed to float as proposed above, the sav-
ings would be passed on to the public who chose not to ride
in large taXicabs.
Street congestion. A }ustification often cited for limiting
the number of medallions is the reduction of street con-
gestion, but this constraint has done little to alleviate the
problem. If, for example, lower Manhattan could provide
enough business for the entire medallioned sector then all
11,787 medallioned taxicabs in New York City would cruise
there searching for fares, leaving the rest of the city to
be served by the gypsy taXicabs. Clearly, limiting the num-
ber of medallions is no solution to the problem of street
congestion.
The problem could be dealt with more effectively by seil-
ing special licenses to cruise in those areas that are the most
congested. For example, the congestion in midtown Man-
hattan could be relieved-without 'Iimiting service in other
areas-by the selling of these licenses (renewable annually)
to those operators who wanted to cruise in that area.
In sum, the record of New York City's regulation of its
taxicab industry over the last 70 years has been almost uni-
forrflly poor. The regulatory agencies have placed the pri-
vate interests of some groups of taxicab operators above the
needs of the Industry as a whole and far above the needs of
the public. If the public Interest Is to be served in the future,
the regulators must begin by distinguishing between those
areas of regulation that serve the public Interest and those
that impose unnecessary costs on the public.
August 1980
Notes
1. City of New York, Board of Aldermen Minutes, June 29, 1909.
2. New Vork American, May 10, 1913; M
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tu
.in
e
se
rv
ic
e
in
th
e
ci
ty
of
N
ew
Y
or
k.
It
sh
al
l
be
th
e
fu
rt
he
r
pu
rp
os
e
of
th
e
co
m
m
is
si
ol
l,
C
O
lls
on
au
t
w
it
h
th
~
pr
om
ot
io
n
an
d
pr
ot
ec
ti
on
of
th
e
pu
bl
ic
co
m
fo
rt
an
d
co
nv
en
ie
nc
e
to
ad
op
t
an
d
es
ta
bl
is
h
an
ov
er
al
l
pu
bl
ic
tr
an
sp
or
ta
ti
on
po
lic
y
go
ve
rn
in
g
ta
xi
,
co
ac
h
an
d
lim
ou
si
ne
se
rv
ic
es
as
it
re
la
te
s
to
th
e
ov
er
al
l
pu
bl
ic
tr
an
sp
or
ta
ti
on
ne
tw
or
k
of
th
e
ci
ty
;
to
es
ta
bl
is
h
ce
rt
ai
n
ra
te
s,
sW
ld
ar
ds
o
f
se
rv
ic
e.
st
an
da
rd
s
of
in
su
ra
nc
e
an
d
m
in
im
w
n
c
o
v
e
r
a
~
;
st
an
da
rd
s
fo
r
dr
iv
er
sa
fe
ty
;
st
an
da
rd
s
fo
r
2
~
u
i
~
t
sa
fe
ty
an
d
de
si
gn
;
9t
an
da
rd
s
fo
r
no
is
e
an
d
ai
r
po
ll
ut
io
n
co
nt
ro
li
an
d
to
st
an
da
rd
s
an
d
cr
it
er
ia
fo
r
th
e
li
ce
ns
in
g
of
ve
hi
cl
es
,
dr
iv
er
s
an
d
c:
h3
.u
if
eu
r~
ow
ne
rs
an
cl
>~
'
op
er
at
or
s
en
ga
ge
d
in
su
ch
se
rv
ic
es
;
al
l
as
m
or
c
pa
rt
ic
ul
ar
ly
se
t
fo
rt
h
he
re
in
.
--
12
30
1.
M
em
lM
nb
ip
of
co
m
ai
..
io
o
..
-a
.
T
h
e
co
m
m
is
.i
on
sh
al
l
co
n.
ta
t
of
D
~
:
m
em
be
rs
to
be
ap
po
in
te
d
by
th
e
m
ay
o
r
w
it
h
th
e
ad
vi
ce
an
d
co
ns
en
t
o
f
th
e
ci
ty
co
un
c:
if
i
fi
ve
o
f
sa
id
m
em
be
rs
.
on
e
T
tS
id
en
t
fr
o
m
ea
ch
o
f
,th
e
fi
ve
bo
ro
ug
hs
o
f
N
ew
Y
o
rk
ci
tf
sh
al
l
be
re
co
m
m
en
de
d
fo
r
ap
po
in
tm
en
t
by
a
m
aj
o
ri
ty
vo
le
o
f
th
e
co
un
ci
lm
tn
o
ft
b
i.
re
sp
ec
ti
ve
bo
ro
ug
h.
.~
:
b.
S
uc
h
m
em
be
rs
sh
al
t
be
ap
po
in
te
d
fo
r
te
rm
s
of
se
ve
n
ye
ar
s.
T
he
m
em
bm
~
-
fi
rs
t
be
ap
po
in
te
d
to
se
rv
e
as
fo
ll
ow
s:
1.
F
iv
e
m
em
be
rs
re
oo
nu
nc
nd
ed
by
th
e
ci
ty
co
un
c:
i1
fo
r
a
te
'rm
o
f
tw
o
ye
ar
L
2.
T
w
o
m
em
be
rs
fo
r
a
te
rm
of
fo
ur
ye
ar
s.
3.
T
w
o
m
em
be
rs
fo
r
a
tc
nn
of
si
x
ye
ar
s.
E
ac
h
su
ch
o
th
er
m
em
be
r
sh
al
l
se
rv
e
un
ti
l
th
e
ap
po
in
tm
en
t
an
d
qu
al
if
ic
at
io
n
of
a
su
cc
es
so
r.
F
or
th
e
pu
rp
os
e
of
fi
xi
n
..
th
e
ex
pi
ra
ti
on
of
te
rn
1~
,
th
ey
sh
al
l
Ix
:
de
cm
ec
f
to:
~l
av
e
co
m
m
en
ce
d
on
th
e
fir
st
da
y
of
F
~
b
r
u
a
r
y
in
th
e
ye
ar
o
f
ap
po
in
tm
en
t
an
d
qu
al
if
iQ
'!-
tio
n,
ir
re
sp
ec
ti
ve
of
th
e
ac
tu
al
da
te
of
ap
po
in
tm
cp
t
an
d
qu
al
if
ic
at
io
n.
V
ac
an
ci
es
ot
bi
:".
th
an
by
ex
pi
ra
ti
on
of
iii.
te
rm
sh
al
l
be
fil
le
d
fo
r
th
e
un
ex
pi
re
d
te
rm
.
T
he
m
ay
or
'ina
:
re
m
ov
e
an
y
su
ch
m
em
be
r
fo
r
ca
us
e,
up
on
st
at
M
ch
ar
ge
s.
N
ot
w
it
hs
ta
nd
in
g
th
e
pr
ov
is
io
ol
,
of
th
is
pa
ra
gr
ap
h,
(li
ly
pu
bl
ic
of
fi
ce
r
ap
po
in
te
d
to
th
e
co
m
m
is
si
on
sh
at
l
se
rv
e
on
ly
dn
r..
in
g
th
e
pe
ri
od
th
at
:
he
ho
ld
s
su
ch
pu
bl
ic
of
fic
e
an
d
'S
ha
ll
re
ce
iv
e
no
ad
di
ti
on
al
co
m
pm
sa
tlo
Q
r
c.
T
he
m
a.
yo
r
sh
al
l
de
si
gn
at
e
an
t
m
em
be
r
of
th
e
co
m
m
is
si
on
to