Driving Austin, Driving Injustice - Taxi Drivers Association of Austin

Transcription

DRIVING AUSTIN,
DRIVING INJUSTICE
A Report on the Working Conditions of Taxi Drivers in Austin
LEGAL ASSISTANCE TO
MICROENTERPRISES PROJECT
— February 2010 —
DRIVING AUSTIN,
DRIVING INJUSTICE
— February 2010 —
LEGAL ASSISTANCE TO
© 2010 Texas RioGrande Legal Aid
ACKNOWLEDGEMENTS
The purpose of the Driving Austin, Driving Injustice study was to review the working
conditions of Austin taxi drivers. The Taxi Driver Association of Austin (TDAA) is a newly formed
advocacy group made up of taxi drivers intent on improving the lives of all Austin taxi drivers. The
Legal Assistance to Micro-Enterprises Project (LAMP) is a project of Texas RioGrande Legal Aid
and Texas C-BAR, funded in part by the Department of Housing and Urban Development. LAMP
provides free legal assistance and representation, pro bono referrals, community education, and
legal resources to income-eligible self-employed persons and microentrepreneurs in Texas. Texas
C-BAR is a special project of Texas RioGrande Legal Aid, assisting nonprofits statewide with
business law assistance through pro bono referrals, legal education manuals, and workshops. Texas
C-BAR, LAMP, and TDAA produced this report.
Thank you!
This report would not have been possible without the assistance of Whitney Cox, on loan to
TRLA thanks to the Sidley Austin LLP pro bono assistance program. Thanks also to April
Kapolwitz for assisting with surveys and research. Funding was provided in part by the TDAA and
the Austin Chapter of the National Lawyers Guild, which is dedicated to the need for basic and
progressive change in the structure of our economic system. Thanks also to Ofelia Zapata, Robin
Cravey, David Richards, Kevin Jewell, and Richard Troxell for their comments and support.
Workers Defense Project, a non-profit community organization that promotes fair working
conditions for Austin’s low-wage workers, provided insight and permission to utilize a format
similar to their comprehensive and enlightening study of the construction industry in Building
Austin, Building Injustice. Thanks also to Skadden, Arps, Slate, Meagher & Flom LLP for printing
this report.
We would also like to recognize Dr. Robert Bruno, Associate Professor of Labor and
Employment at the University of Illinois who shared the survey instrument used in the Illinois
study Driven Into Poverty: 2008 Comprehensive Study of the Chicago Taxicab Industry and Gary Blasi
and Jacqueline Leavitt for Driving Poor: Taxi Drivers and the Regulation of the Taxi Industry in Los
Angeles, 2006, so we did not have to re-create the wheel. This study is similar to studies of the taxi
industry in other cities and anyone interested in the working conditions of taxi drivers should refer
to those sources in the appendix.
Design by BeasleyCreative
Photos © Alan Pogue 2009
Sebastian Garcia as the Taxi Driver
TABLE OF CONTENTS
Part I: Executive Summary ...............................................................................................................1
Part II: Industry Overview ...............................................................................................................5
Part III: Driving a Taxi....................................................................................................................15
Part IV: Unregulated Competition.................................................................................................33
Part V: Recommendations ..............................................................................................................37
Part VI: Appendix............................................................................................................................41
PART I:
EXECUTIVE SUMMARY
3
PART I: EXECUTIVE SUMMARY
By undertaking this study, we hoped to gain a greater understanding of the taxi cab
industry in Austin. This industry is created and minutely regulated by City ordinances. To this end,
we reviewed the history of the franchise system in Austin, studied systems in other major
metropolitan areas, examined transportation issues, and surveyed 66 current drivers. This is the
first time such a large survey of taxi drivers has been undertaken in Texas.
Among our most startling findings are:
The average driver earns $200 per week before taxes.
The pre-tax salary for a minimum wage employee in Texas is $290 for a 40-hour work week.
For roughly $800 a month, it is a constant struggle for drivers to meet their own economic needs
and even more difficult for the nearly 60% of drivers trying to support a family.
The average driver makes $2.75 an hour.
This amount is $4.50 less then Federal minimum wage1 and approximately $9.00 less than the
recommended living wage in Austin, Texas.2
The average driver works 12 hours a day, 6.5 days a week, 51.5 weeks a year.
Drivers do not earn overtime or accrue vacation. They are classified as independent
contractors and are left without the legal protection of employees.
Taxi drivers have no insurance or benefits.
Vehicle insurance policies do not cover drivers if a driver is involved in an accident, even if the
driver is not at fault. Drivers do not receive health insurance unless they receive government
assistance, pay for it out of pocket, or receive coverage through a spouse. Only 40% of drivers have
health insurance coverage.
Taxi drivers have no voice in the city ordinances regulating the industry.
The ordinance leaves rate change proposals, requests for taxi zones, and other issues to the
franchise holders. Nowhere does the ordinance call for driver input into decisions. Some
franchises discourage drivers from organizing or having a collective voice, and drivers fear
retaliation if they organize.
Drivers compete with unregulated competition, such as pedicabs and SuperShuttles.
The ratio of pedicabs to taxicabs in Austin is higher than any other city that we found. Pedicabs
operate without fare restrictions and accept “tips only,” which can lead to a virtual shakedown of
customers at the end of the ride and offers no consumer protection. There is no cap on the
number of permits issued by the city to other types of vehicles for hire.
1 http://www.dol.gov/whd/Flsa/index.htm (The Federal minimum wage and Texas minimum wage is $7.25).
2 http://www.universallivingwage.org/ (listing a living wage between $10.90 and $13.19 in Austin).
DRIVING AUSTIN, DRIVING INJUSTICE
4
PART I: INTRODUCTION / EXECUTIVE SUMMARY
Because this industry is one regulated by City ordinance, there are steps that can be taken by
the City Council to reform this vital Austin industry. To have the greatest impact, City Council
must offer integrated solutions and monitor the impact that any regulatory changes have to ensure
continued improvement. We urge the City Council to consider the following recommendations:
1. Undertake a comprehensive study of the taxi industry in Austin and its contributions to the
transportation system.
2. Reexamine the ordinances regulating ground transportation and vehicles for hire with
particular attention to the following areas of the ordinances:
• Permitting Allocation Formula: The City Auditor reviewed other formulas to calculate
increases and decreases in permits.
• Rate Increase Process: The once-every-five-year requests for rate changes do not allow
drivers to catch up to cost of living increases.
• Insurance Coverage: Taxi drivers are not covered under the vehicle insurance policies that
franchises are required to carry.
• Taxi Permit Transfers: Other systems allow permits to move between franchises to increase
competition between franchises and promote better working conditions for drivers.
• Improve Driver Working Conditions: The ordinances should consider issues of job security,
living wage, health insurance, vehicle insurance, and workers’ compensation.
• Other Vehicles for Hire: The City should review permitting and regulation of pedicabs,
SuperShuttles, and other vehicles for hire to create a level playing field and consumer
protection.
3. Give drivers a voice to help influence the industry. Drivers who want to organize and
participate in the decisions that affect their livelihood should be afforded the protection to do so
without fear of retaliation.
PART II:
INDUSTRY OVERVIEW
7
PART II: INDUSTRY OVERVIEW
Taxicabs are an integral part of the transportation system of the city of Austin. The drivers
move thousands of airport travellers; take people without cars or who are unable to drive to the
grocery store, work, or medical appointments; provide convenience to well-to-do people in Austin;
and offer safe passage home to downtown party-goers. The city of Austin highly regulates the
taxicab industry at almost every
stage, such as granting franchise
rights to owners of taxicab
companies,3 distributing permits
to operate vehicles for hire,4
licensing drivers,5 regulating the
prices drivers may charge for
their services,6 and even enforcing
special city ordinances that only
apply to drivers of taxicabs.7
The drivers are vulnerable to
abuse by the industry itself with
its risks and instability, and
there is little opportunity for the
voices of drivers to be heard
Driver waiting at the airport
before public entities.
Different cities have various
strategies to integrate taxis into their public transportation system.8 New York City has long
considered taxis a public utility. Some cities operate under a medallion system, whereby the city
sells a permit (medallion) directly to the drivers for a one-time fee. The driver owns the medallion
and can drive a taxicab until retirement (assuming all other laws and regulations are followed).
Upon retirement, the driver can sell a medallion to another driver, oftentimes at an incredibly
high price.9 In contrast, the City of Portland specifically retains ownership of taxi permits.10
San Antonio leases to single taxicab owners as long as they are part of a city-approved
operating association.11
3 Austin City Code § 13-2-303.
9 http://www.pbs.org/wnet/taxidreams/history/
history_2.html.
10 Portland City Code, Transfer of Decal, Permit
11 San Antonio City Code § 33-971 (“Every
taxicab shall be operated as a unit of an
effective operating group of sufficient
or Taxiplate Interest Prohibited, Permit
number…. This requires that owners of small
16.40.240. (“All permits, decals and taxiplates
fleets or single taxicabs shall operate as
issued by the City under the terms of this
members of a city approved operating
utilities both in Article XI, and refers to the
Chapter are City property and cannot be
association or as independent contractors
provision in § 13-2-305.
leased, sold, transferred or assigned in any
as provided for in this chapter.”).
8 Austin’s city charter places franchises and public
manner.”).
8
METROACCESS
One of the most important but least acknowledged purposes of the Austin taxicab industry is its
alternative to MetroAccess (formerly the Special Transit Services (STS)) for the mobility impaired.
According to Capitol Metro (CapMetro), the provider of transit services for Austin, taxicabs are used
as transportation back-up as well as an alternative shuttle service for disabled or elderly citizens.
Taxi vouchers are used for alternative taxi services such as when making return reservations from
medical appointments, veterinary services for a service animal or dog guide, jury duty, grocery stores,
out-of-town travel or to and from a fixed route bus sedan.* Furthermore, the Transit Cooperative
Research Program stated that without taxicab rides, Austin would not meet the requirements of the
Americans With Disabilities Act (ADA) which “requires that a federally funded transit agency provide
services for people with disabilities that are parallel to the fixed-route service in terms of wait times
and service area”.**
Drivers earn a higher rate of fare than established by city ordinance if they carry MetroAccess
passengers. The passenger pays nothing for the first 6.09 miles of service. Yellow Cab approves the
billing, pays the driver, and sends the invoice to Capital Metro, which then reimburses Yellow Cab.
Drivers reported frustration with the Capital Metro process which sometimes kicks back a fare
months later for a typographical error on the address. Randy Hume, Executive Vice President of
Finance and Administration, has stated that CapMetro hopes to utilize a new system that eliminates
the exceptionally long lag time.
Ofelia Zapata, a MetroAccess rider, believes taxi service provides a crucial component to the
transit system. “I love going to church, to my ministry meetings, to the board meetings I serve on. It
gives me meaning because I can still do something. I quit working in 1995 because of my blindness;
“
“I thought when I
lost my drivers license
that I was going
to be trapped at home.”
”
I thought when I lost my drivers license that I was going to be trapped at home. To give my
children a normal childhood despite my disability is so important to me, and the cab drivers help
make this possible. [Without the service] I would not be where I am today, people wouldn’t see me
as a person that despite my disability still cares and can contribute to the community like everyone
else. It gives us basic rights as citizens.”
* Metro Access Service Policies and Procedures Guide, www.capmetro.org.
** July 2008, Cap Metro Disability-Service Cuts on Hold, The Austin Chronicle.
9
Three franchises conduct Austin's taxi business: Austin Cab,12 Lone Star Cab, and Yellow Cab.13
The City Council approves the franchises14 and allocates each one a specified number of permits.15
The permits, under city ordinance, expire but are leased on an annual basis for a nominal
amount of $400 per permit.16 Drivers may not lease a permit directly; permits are only allocated
to franchises and the allocation is widely skewed. Franchises renew their authority to operate every
five years.17
The drivers of taxicabs must apply to
the City for a chauffeur’s permit.18 Part of
the application requires that the applicant
disclose which of the franchises is
sponsoring the driver.19 Thus, even at the
early stage of procuring a permit to
operate a vehicle, drivers are already
dependent upon the franchise. In fact, the
ordinance stresses the franchise control
over the drivers repeatedly.20 The ordinance
specifically authorizes franchises to hire
drivers as independent contractors.21 During the first one-year term of the Yellow Cab contract, the
franchise can cancel the arrangement for a broad array of reasons, including subjective reasons.22
In subsequent terms, franchises can cancel any contract for no reason upon 30 days notice. There
are no regular pay increases, no benefits, and no safety net in the event of poor earnings.
Once a driver starts driving for the cab company, the driver operates a vehicle under one of the
permits leased to the franchise from the City. Passengers get in and out of the vehicle throughout
each shift and pay the metered rate proscribed by City ordinance.23 From 8:00 A.M to 5:00 P.M.
Monday through Friday, two enforcement officials for the Transportation Department split their
time between administrative tasks and enforcing the ordinances that apply to vehicles for hire.24
Such ordinances include protection for passengers – requiring that taxicabs take the most direct
route25 – and ordinances for the protection of the drivers – disallowing “bandit” or unauthorized
cabs to pick up passengers in city limits.26 Practically no enforcement exists between the hours of
5:00 P.M. and 8:00 A.M. or on weekends.27 The ordinances regulate driver appearance,28 limit the
number of magazines a driver can have in the vehicle,29 require matching hubcaps,30 require rest
after 12-hour shifts,31 and regulate a number of other details. Franchises must offer citywide
service,32 operate a 24-hour dispatch,33 and control the operations of vehicles.34
12 Austin Cab is a dba of Harlem Cab.
13 Yellow Cab is a dba of the Greater Austin
Transportation Company (GTAC).
16 Austin City Code § 13-2-321; § 13-2-329.
17 Austin City Code Table of Special Ordinances,
Table 1, Franchises.
20 Austin City Code § 13-2-73; § 13-2-102;
§ 13-2-103; § 13-2-105; § 13-2-106;
§ 13-2-305; § 13-2-342.
22 We reviewed an individual driver's contract with
GTAC to get a better understanding of the
terms of employment.
27 Audit Report, City of Austin Taxicab Permitting
Process, December 15, 2009, Page 11
(Although overtime or compensatory time is
offered to the enforcement officials, between
January 2009 and October 2009 "the officer
only worked 18 hours out of the possible 1,920
weekend hours (approximately 1% of the total
hours.").).
29 Austin City Code § 13-2-142(H)(2).
30 Austin City Code § 13-2-142(G)(2).
32 Austin City Code § 13-2-302(A)(3); § 13-2-343.
34 Austin City Code § 13-2-305(B)(7).
10
THREE FRANCHISES CONTROL THE AUSTIN MARKET
In Austin, taxi service is currently split between Austin Cab, Lone Star Cab and Yellow Cab. The
City Council authorized Lone Star Cab to operate in July 2007.35 Austin Cab operated as Harlem
Cab beginning in 1943.36 Yellow Cab, which has businesses in other cities as well, became a
franchise in Austin in 1985.37 In a recent report by the Office of the City Auditor, Austin was the
only one of 13 cities the auditor surveyed that limited the number of franchise holders.38
The total number of permits
allocated among the three
franchises is 669.39 However, these
NUMBER OF PERMITS ISSUED
permits are not split evenly
between the three franchises.
Yellow Cab holds 455 permits,
Austin Cab holds 159 permits, and
Lone Star Cab holds 55 permits.40
Under this allocation, Yellow Cab
holds permits for 68% of the taxis
in Austin while Austin Cab and
Lone Star each hold 24% and 8%
of the permits, respectively. The
disproportionately large percent
of permits allocated to Yellow
Cab seems to contradict the
“monopoly” provision limiting
allocations to no more than 60% of
all of the current outstanding
permits, unless there is no other
viable option.41 A prior city council
exacerbated the disparity upon
the dissolution of Roy’s Taxicab
Company in June 2006, awarding
140 of Roy’s permits to Yellow
Cab and only eight permits
to Austin Cab 42 and likewise
circumvented the ordinance in taxi
35 Audit Report, supra note 27, at 2.
36 http://harlemcab.com.
40 Audit Report, supra note 27, at 2;
Sandra Zaragoza, Cab Companies Feeling
37 http://www.yellowcabaustin.com.
Recession, Hopeful that Worst is Over, Austin
Business Journal, October 2, 2009.
39 The allocation is 631, plus 38 accessible vehicles.
42 Wells Dunbar, How Many is Just Right,
The Austin Chronicle, June 9, 2006,
http://www.austinchronicle.com/gyrobase/Issue/
story?oid=oid%3A373275; Audit Report, supra
note 27, at 2.
11
permit allocation by “borrowing” from future allocations.43
The calculation of necessary permits is based on city population and the number of taxicab
departures from Austin-Bergstrom International Airport (ABIA).44 The ordinance allows the
department to increase permits based on public necessity but not to decrease the number when the
need decreases.45 The City does retain the right to amend a franchise46 and requires a showing of
public necessity for renewals.47 The city charter controls franchises.48
The City Auditor recently determined that Austin has an excess of outstanding permits.49 His
report also calculates permits using the methodology of other cities. Surprisingly, if Austin used the
Dallas calculation, the City would authorize only 244 permits rather than 631 permits50—a nearly 2/3
reduction in cabs. Using San Antonio’s formula, Austin would operate only 446, a 1/3 reduction.51
The allocation of additional permits is a direct conflict between drivers and franchise owners.
More competition hurts drivers but gives the franchises thousands of dollars in additional income
a year.52 If Austin used the Dallas or
San Antonio permitting formulas,
drivers would have an opportunity for
significantly increased income because
of lessened competition.
RATE INCREASES
Changes to taxi meter rates can only
be initiated by a majority of franchise
holders.53 Transportation staff rejected
the first franchise holder application for
rate changes in 2009 and the companies
submitted an amended proposal.
Although the department invited drivers to two rate increase meetings, driver comments did not
appear to influence the staff recommendation to the Urban Transportation Commission.
The last time there was a fare increase was 2005. According to the Consumer Price Index for
Urban Consumers, Southwest Region, cost of living increased approximately 13.7% between 2005
and 2009.54 The fare increase request in 2010 amounted to only a 3.6% increase.55 This request
means the drivers are facing a nearly ten percent pay cut coming in to the new decade. One of the
franchise holders increased their charges to the drivers seven percent after the increase in 2005.
Consequently, those drivers put less than half the prior increase in their pockets, while the
companies took the greater portion. Using this process, drivers have little hope of recouping
rising costs.
43 Id.
47 Austin City Code § 13-2-302; § 13-2-303.
48 Charter, Article XI and Article I, Sec. 4.
50 Does not include the 38 accessible vehicles.
52 As explained in Part II of this report, while
drivers’ income is dependent upon fares and
tips, franchises received income in the form of
set fees and expenses charged to the drivers.
Each additional driver is addition income to the
franchise regardless of the income of the driver.
54 November 7, 2009, Request for Taxicab Rate
Change.
55 December 15, 2009, Request for Taxicab Rate
Change.
12
TAXI DRIVERS AS INDEPENDENT CONTRACTORS
Since the late seventies, the industry classifies taxi drivers as independent contractors.
This benefits cab companies because independent contractors are workers who do not have the
benefits of employees. Businesses often try to save money by using independent contractors rather
than employees. When a business has employees, in addition to salaries or other compensation,
employers must pay expenses such
as federal payroll taxes, state and
federal unemployment insurance
taxes, social security taxes,
workers’ compensation insurance
premiums and various employee
benefits such as health insurance,
vacation and sick leave. The
additional expenses may add about
20-30% to payroll costs. The taxi
industry has, at various times,
had independent contractors,
employees, and commissioned
drivers. The move to eliminate
commissioned drivers, once the
dominant system, has occurred
only in the last thirty years as
a result of regulation, local
ordinances, and industry changes.
Under the commission system that
operated in Austin until the 1980s,
drivers and owners shared each
day's fare revenue, often a 50-50
split. Clearly a bad day impacted
both owner and driver and the risk
was shared. When the system
changed to an independent
contractor scheme all the risk
shifted to the driver. Cab company
owners, without ever getting
behind the wheel, earned a
guaranteed and predictable living
because they controlled the permit.
FOR AN
INDEPENDENT CONTRACTOR,
THE RISKS ARE HIGH.
THERE IS
NO JOB SECURITY.
13
The drivers value independence and flexibility.
However, the number of hours worked belies the
reality of flexibility. As one driver noted, " we are free
THE FRANCHISES
to drive any 15 hours a day we choose." For an
independent contractor, the risks are high. There is
no job security. A franchise holder can pull a driver's
CONTINUE TO PROFIT
permit with little notice. The drivers are economically
dependent on the franchises because it is the company
that holds the permit to operate a taxi. Independent
WHILE THE DRIVERS
contractors must pay their own Social Security and
Medicare taxes (“self-employment taxes”), which are
15.3% of earnings. If an independent contractor is
injured while driving a cab, there is no workers'
WORK LONGER AND
compensation coverage in Texas. (New York cab drivers
are covered by workers' compensation insurance.) As
an employee, a worker can collect benefits even if the
LONGER HOURS
injury was the worker's own fault. If a driver picks up
a fare jumper the driver won't be paid, but will have to
pay the franchise holder the lease or terminal fee
TO MAKE UP FOR THE
regardless of whether the driver collects any revenue.
In Austin, because a driver cannot move a permit
to drive from one franchise holder to another, a
LOSS IN INCOME AND
driver is not a true independent contractor. In a
mobile permit scheme, a driver could operate a car
after obtaining a
EFFECTS OF INFLATION.
permit number
from the city
and choose which
company to work
with based on the
quality of the company's services such as the dispatch system,
name recognition, or the cost of the terminal fee. Instead, the
franchise holder sells the opportunity to drive a cab through
a terminal fee, finances the cars, and complies with insurance
requirements. To a taxi franchise holder, a driver is easily
replaced with the next name on the waiting list, but it is the driver who incurs all the risk of the
loss of an accident, illness, or just slow business. Consequently, the franchises continue to profit
while the drivers work longer and longer hours to make up for the loss in income and effects
of inflation.
PART III:
DRIVING A TAXI
Driver working 6th Street.
PART III: DRIVING A TAXI
DRIVER DEMOGRAPHICS
There are approximately 750 cab drivers in
Austin.56 During the information-gathering phase
of our study, we were able to interview 66 drivers,
approximately 8% of the estimated total driver
population. We believe the demographics for the
drivers we interviewed are representative of the
drivers in Austin and prove that the population
is diverse – full of both men and women, native
born and immigrants, old and young. Nonetheless,
statistically, the majority of drivers we interviewed
were born in the United States, with the second
largest group being drivers born in Ethiopia. The
majority of drivers are men with an average age of
45 who have at least nine years of experience behind
the wheel of a taxicab. Over half of the drivers
interviewed are married and nearly 60% are
struggling to support at least one child. One driver
detailed being responsible for the livelihood of six
children, but the average number of children
supported by Austin drivers is approximately two.
The profession has a high turn-over rate.
Forty-one percent of taxi drivers in Austin have
driven a taxi for less than five years. New York City,
on the other hand, reported only 14% of drivers
with four years of experience or less.57
In addition, Austin had 37% U.S.-born taxi
drivers, a significantly higher percentage than other
cities. Chicago had nearly 10%,58 New York City had
6%,59 and Los Angeles reported less than 1% of
U.S.-born taxi drivers.60
17
YEARS OF EXPERIENCE DRIVING
COUNTRY OF ORIGIN
OF INTERVIEWEES
* Other countries of origin represented in the survey were:
Argentina, Armenia, Brazil, Canada, El Salvador, Eritria,
Ghana, Guinea, Iran, Pakistan, Somalia, and the Sudan.
NUMBER OF CHILDREN BEING
SUPPORTED ON
TAXI DRIVER INCOME
56 We do not have a precise number of taxi drivers in Austin because some of the
669 permits may be idle and some permits may have two drivers that split
day and nights or weekend shifts. Of those surveyed, approximately 5%
acknowledged sharing the cab with another driver. The Transportation
Department does not collect this number. Assuming we missed night and
weekend drivers in the weekday timeslots during which we surveyed,
we estimate a higher portion (12%) of permits with two drivers than were
represented in the survey. Consequently, we estimate that there are
750 drivers in Austin.
57 The Community Development Project of Urban Justice Center, Unfare, Taxi
Drivers and the Cost of Moving the City, September 2003, p 6.
58 Robert Bruno. Driven Into Poverty: 2008 Comprehensive Study of Chicago
Taxicab Industry, 2008, page 17.
59 The Community Development Project of Urban Justice Center, supra note 35, at 6.
60 Gary Blasi and Jacqueline Leavitt, Driving Poor: Taxi Drivers and the Regulation
of the Taxi Industry in Los Angeles, 2006, at page 17.
18
DRIVER WORKING CONDITIONS
THEN AND NOW
According to an interview with Robin Cravey,
an Austin attorney and taxi driver between 1970-1980,
the industry has seen some changes
in the last 40 years.
THEN: BETWEEN 1970 AND 1980
NOW: 2010
Franchises: Three franchises – 85 permits:
• Roy’s Cab – 20 permits
• American (Yellow Checker) Cab – 50 permits
• Harlem Cab – 15 permits
Franchises: Three franchises – 669 permits:
• Austin Cab (dba of Harlem Cab) – 159
permits
• Yellow Cab (including former Roy’s Cab)
– 455 permits
• Lone Star Cab – 55 permits
Dispatch: A handwritten list and
communication between the dispatcher
and drivers through radios. Fares assigned
by dispatcher.
Dispatch: Computer system and display
systems in each cab. Fares assigned by
“first up” in zone.
Airport: Roughly 3 to 10 cabs would wait at
the airport for one hour or less.
Airport: Roughly 70 cabs wait in line at the
airport for 2-3 hours.
Drivers: 3 types of drivers:
• Commission Driver: Split fares 50%
with cab company
• Lease Driver: Paid $20/day or
$120-$200/week
• Owner Driver: Paid a maintence
and terminal fee of $25-40/week plus
$60-70/month insurance fee.
Drivers: 3 types of drivers:
• Lease Driver: Pays approximately
$350/week
• Buyer Driver: Finances car and pays
terminal fee of $400+ a week
• Owner Drivers: Pays a terminal fee
of $200-290/week
Days and Hours Worked
Hours Worked per Day: 8-10
Days Worked per Week: 5
Days and Hours Worked
Hours Worked per Day: 12
Days Worked per Week: 6-7
Net Earnings*
Net Earning per Week: $150-200
* $200.00 in 1970 had the buying power of $1,105.86 in 2009.
http://databls.gov/cgi-bin/cpicalc.pl.
Net Earnings
Net Earnings per Week: $200
Robin Cravey in a line of three cabs
at Mueller Airport, 1974.
Lupe Perez dispatches for Roy's Taxi, 1974.
20
THE ECONOMICS
Our study attempted to parse how much
cab drivers in Austin earned and how long
they worked to earn it. A driver’s income
comes from fares set by the City Council and
tips.61 Income is variable depending upon
which area of town a driver works, how
many hours a driver works, the weather, and
sometimes just luck.
Taking the average from all drivers
surveyed, 65% of drivers work seven days a
week, 12 hours a day, more than 51 weeks
of the year to earn an average of $200 a
week, which converts to about $2.00 per
hour. A seventy-hour work week yields
approximately $784 gross income a week.62
Only 6% of the drivers interviewed claimed a
five-day work week, but they generally drove
12-14 hours on those days. Gross income is
adjusted by subtracting expenses to obtain a
net income before taxes.63
During the Great Depression, one of the
worst and most desperate times in American
history, cab drivers were earning low wages
but working fewer hours. One of the most
disturbing findings of the report is that
drivers work longer hours now than at the
peak of the nation's economic crisis 80
years ago.
DRIVERS WORKED 8-10 HOURS
DURING THE DEPRESSION
From Waiting for Lefty*
by Clifford Odets 1935
*Based on a 1934 strike of unionized cab drivers in
New York City, Odets wrote the play at the height of
the Great Depression and stages throughout the
country performed the hit. The character of “Joe” is
a cab driver.
Setting: At a driver's committee meeting
JOE: "There's us comin' home every
night–eight, ten hours on the cab.
"God," the wife says, "eighty
cents ain't money–don't buy
beans almost. You're working' for
the company," she says to me,
"Joe! you ain't workin' for me
and the family no more!"
63 Computed from 66 responses. Our intention
caution, we reviewed every survey and, where
was to ask about gross income and expenses
there was any indication of misunderstanding,
were very close to the income reported by the
separately and then compute net income.
we inserted the higher number to calculate
franchises in the Auditor Report, assuming a
It was clear by comparing answers about
income. Only one driver thought the average
10% decrease in airport traffic and franchise
gross income and expenses that some drivers
income figures were low.
revenue between 2008 and 2009.
considered “total” or “gross” income to
62 The numbers that drivers reported for income
mean “net income.” In an abundance of
21
DRIVER INCOME IS LOW
Surveys revealed that there are three general categories of drivers: “renters,” “buyers,” and
“owners.” “Renters” are drivers that lease a taxicab, pay for it on a daily or weekly basis, and incur
none of the additional costs of ownership, such as maintenance, but accrue no long-term equity in
the vehicle.
“Buyers” are drivers that have a contract to lease/purchase the taxicab from either the
franchise or another individual. This is hardly a purchase in the true sense of the word as failure to
pay even one week or one late payment may result in forfeiture of the automobile and loss of any
equity.64 During a driver’s tenure with a cab company, the car is titled in the name of the franchise,
even after the car is
paid in full, so long as
(66 drivers interviewed)
A Cab Driver’s “Vacation”
a driver continues to
Average Number of Days Worked Per Year
360.18
operate the vehicle as a
Average Days Not Worked Per Year
4.82
taxicab. These “buyers”
Average Days Missed Due to Illness Per Year
1.34
purchase a car at a high
Average Days “Off” Per Year
3.48
rate of interest (often
18%) because they have
little access to capital, have trouble obtaining insurance, and must give the title to the car to the
franchise. In order to drive for Yellow Cab, a driver must buy his or her first car through Yellow
Cab.65 The ordinance mandates that a car be retired from operation once it reaches 96 months
(eight years),66 but drivers report that the franchise makes them replace a car every
seven years. Given that it takes roughly five years to pay off a vehicle (even with high weekly
payments) drivers generally have only
two to three years of debt-free driving
before they must start the process
over again.
VEHICLE OWNERSHIP RATES
“Owners” are drivers who are no
longer making payments on a vehicle.
Some of these drivers opted to purchase
their current taxi at auction outright
rather than finance it for several years.
Even if these drivers own their cars,
they still have to pay the franchises a
weekly “terminal fee” to operate their
taxicabs. The weekly terminal fees are:
•
•
•
Lone Star Cab: $200
Austin Cab: $235
Yellow Cab: $290
64 Yellow Cab Contract, October 2008.
65 Interviews with drivers.
66 Austin City Code § 13-2-389 (A modified ground transportation vehicle (in accordance with the ADA) may be in service for 120 months (10 years).).
22
FRANCHISE HOLDER GROSS INCOME
Taxi franchise holders' revenue is completely independent from the ridership, the
weather, or a downturn in the economy. Franchise holders receive income in a variety of
ways. However, their primary source of income is through the fees charged to
cab drivers. Under the ordinance, a franchise is the only entity to which the City will
grant a permit to operate a taxi, which the franchise, in effect, resells to a driver at a
much-inflated cost. Terminal fees that franchises charge drivers are not regulated.
Revenue includes other sources of income such as advertising revenue,* revenue from
leasing or financing the vehicles, and the other penalties, fees, and payments drivers make.
The City receives $400 per year per permit that is leased to a taxi franchise. Yellow Cab
is the largest company and leases 455 permits from the City per year. The City receives
$182,000 in revenue from leasing permits to Yellow Cab each year.
455 PERMITS X $400 = $182,000
Yellow Cab charges every driver (buyer, leaser, or owner) $290 terminal fee per week to
drive a taxi under each of its 455 permits. The terminal fee covers more than just the cost
of the permit, but also the cost of dispatch, employees of the franchise-holder and
insurance. Yellow Cab is self-insured, which requires reserve funds that result in an
opportunity cost.** Austin Cab is also self-insured, but Lone Star Cab is not. Assuming
all permits are operational and paid, Yellow Cab potentially receives a total of $6,861,400
in revenue from drivers to drive a taxi under a permit leased from the City to Yellow Cab.
455 permits x $290 x 52 weeks = $6,861,400
A simple calculation shows that for each permit the City allocates to Yellow Cab for
$400 per year, the holders may earn $15,080 in gross income per year.
*
The franchises offer ad space to local businesses in the form of signage on the taxicabs. Drivers are generally not allowed to select
the signage they want or reject signage they do not want (even if they find it offensive). Instead, drivers must pay a fee to the
franchise to keep signage off of their car ($15/ week). Assuming this fee represents lost revenue, Yellow Cab makes $350,000
off of advertising alone ($15 x 455 x 52= $354,900)
** Texas Transportation Code, chapter 601.
In addition to these weekly payments,
drivers are responsible for other expenses. Cab
companies require a driver to build up a
deposit or sometimes two separate deposits.
At Yellow Cab these are called the Driver’s
Deposit and the Maintenance Deposit.
Driver’s are billed $30-40 a week until each
deposit reaches $1500, at which point a driver
may stop paying into the account. Some drivers
add extra funds for contingencies up to
$5,000. Yellow Cab pays 10% interest on the
contingency funds. The deposits operate as a
pre-paid deductible. If the vehicle sustains any
damage, the driver is required to build the
account back up to the minimum. If damage
is greater than $1,500, the driver will be “in
the hole” and must keep making payments
until the company is made whole. Only 3% of
those surveyed reported a crash that totaled
their car. Others who reported a crash relayed
that not only were their deposits emptied,
but they were required to continue making
weekly payments to the taxi company and
paying a daily lease fee to rent a cab to drive
while their own vehicle was repaired. A
company may withhold a return of the
deposit for anything the company deems a
legitimate cost when a driver quits.
Additional driver costs include set up
costs such as painting the signature colors on
the vehicle, which can be $1000 or more. Cab
companies charge drivers five dollars per week
for Ad Valerom tax. An extra fee of between
$10 and $40 is charged over any tollbooth
charge if a driver does not have a toll tag.67
Drivers must also pay the City a $10 chauffer
fee every two years and pay for an updated
criminal history report. Owner drivers pay
23
GREEN TAXIS
Austin offers no rebates to taxi
drivers who purchase a hybrid. Two
drivers in Austin have 2008 Ford Escape
Hybrids. Gas is less expensive, but so far
the vehicles have needed work on the
brake pads (60,000 miles) and cooling
systems. Since the ordinance requires
vehicle replacement every 96 months,*
rebates on fuel efficient vehicles for
drivers who cover 150-200 miles a day
could help Austin's air quality. Dallas
considered allowing hybrids to jump the
line at the airport, but such an incentive
was highly criticized by drivers as unfair.
* Austin City Code § 13-2-389
67 Austin City Code § 13-2-372. (Drivers must take a toll road if a passenger wants to and the toll is passed on to the passenger, but few toll roads have
the old-fashioned cash tollbooth.).
24
Average Weekly Income and Expense Chart
Income
Estimated Gross
Income / Week (Avg)
Income and Expenses of 4 Types
of Drivers Surveyed
1st Year
Leaser
Buyer
Owner
Driver68
$573.86
$800.48
$869.98
$779.05
Auditor
Average69
$862.66
*Fares + Tips before any expenses
Expenses70
Expenses
Driver Deposit
*Paid weekly until you reach $1500
Maintenance Deposit
*Paid weekly until you reach $1500
Ad Valerom
$35.00
$3.71
$40.00
$4.24
$5.00
$5.00
$5.00
$3.56
Lease Fee / Car Note
$272.29
$377.86
$142.89
$190.24
Terminal Fee
Included
in lease
Included
in lease
$277.63
$252.63
$152.65
Fuel
$126.43
$174.46
$226.24
$173.21
$183.91
Cleaning
$12.50
$15.52
$15.91
$15.64
$15.34
Credit Card Surcharge
$11.40
$20.81
$23.02
$19.38
$20.04
$—
$—
$29.01
$20.31
$14.20
$502.62
$593.66
$719.72
$481.18
$587.90
$71.24
$206.82
$150.26
$297.87
$274.75
$71.24
$206.82
$150.26
$297.87
$274.75
Weekly Hours Worked
61.40
81.67
83.53
77.50
78.86
Dollars Per Hour
$1.16
$2.53
$1.80
$3.84
$3.48
*Property tax paid to Taxicab company
*5% of Credit Card Payments
Maintenance
TOTAL EXPENSE
Net Weekly Income
Wage Calculations
Weekly Income
68 First year drivers pay into Driver Deposits and Maintenance Deposits.
70 All expenses are based on averaging 1st Year Drivers, Renters, Buyers
Other drivers may also pay into these accounts if they have been in an
and Owners columns for all of the figures. We did not include figures
accident or had their accounts depleted for some reason.
(income or expenses) to represent drivers who sublease their cabs to
69 December 2008 ($2,865,249) revenue reported by franchises, Audit
Report p 45. ($2,865,249, divided by 750 drivers, divided by 31 days in
other drivers (or those other drivers) as we lacked any good data. We
admittedly did not get a good sampling of night and weekend drivers
December, multiplied by 7 days in a week, got $862.66 earned per
(fn 56) which may have led to an under-representation and lack of
driver per week. We did not adjust the figure for tips or any decrease
adequate data on subleasing in the industry.
in passengers from 2008 to 2009.).
§ 13-2-34 INSURANCE REQUIRED.
(A) Except as provided by Subsection (F), before authority to operate a ground
transportation service in the City becomes effective, an applicant must obtain a
public liability policy issued by an insurance company licensed to operate in the State
of Texas and by an agent licensed by the State of
Texas. The policy must include the following:
bodily injury and property damage coverage;
and owned, non-owned and hired vehicle
coverage. The insurance policy must be in a
form satisfactory to the City, and it must meet
the requirements of this section. The insurance
coverage must be maintained throughout the
term of the operating authority or taxicab
franchise. The applicant must furnish a certificate
of insurance for the policy to the department.
(B) The policy required by Subsection (A) must, at a minimum, provide coverage for:
(1) bodily injury of $100,000 per person and $300,000 per accident;
(2) property damage of $25,000 per accident; and
(3) personal injury protection of $2,500 for each passenger.
(C) A business automobile liability insurance policy that provides coverage for scheduled
vehicles but does not provide the liability coverage prescribed by Subsection (A) does
not comply with this section.
(D) The City must be included as an additional insured on each policy. The holder or
franchise holder is responsible for paying all applicable deductibles.
(E) Each policy must contain a “Cancellation Provision or Coverage Change”
endorsement that provides 30 days notice to the City before the policy is canceled
or materially changed to reduce or restrict the coverage. The notice must be mailed
to the director.
(F) Instead of obtaining the insurance policy required by Subsection (A) of this section,
a holder may furnish proof of compliance with Subchapter E of Chapter 601 (Motor
Vehicle Safety Responsibility Act) of the Texas Transportation Code.
Source: 1992 Code Section 8-13-34; Ord. 031106-13; Ord. 031211-11.
* Emphasis added
25
26
vehicle registration and inspection costs. Additionally, all drivers are required to accept credit
cards, and the cab companies charge their drivers five percent of the total of credit card
transactions, including any tip.
Ignoring irregular or hard to measure periodic expenses, and simply using the most basic and
recurring weekly expenses, the survey responses indicate that taxi drivers, whether owner, buyer, or
renter, are not only fail to make a living wage, but also make well below a minimum wage. Drivers
reported similar earnings whether they took calls primarily from dispatch, served regular
customers, worked hotels, or waited at the airport.
HARDSHIPS OF A TAXI DRIVER IN THE PAST YEAR
12% OF DRIVERS FACED EVICTION OR FORECLOSURE.
38% OF DRIVERS’ UTILITIES WERE TURNED OFF (OR THREATENED TO BE).
43% OF DRIVERS HAD TO BORROW MONEY TO PAY THEIR BILLS.
Few drivers are covered by any health insurance. As an independent contractor, drivers are not
eligible for company provided health benefits or workers’ compensation. Drivers cannot afford to
get sick or take a break, yet these drivers face one of the most dangerous and stressful jobs in the
city. They experience constant exposure to people and money and chronic conditions that can lead
to health problems, such as back and shoulder pain. However, drivers cannot afford a doctor’s visit
or even to take a day off to see a doctor. Fifteen percent have Austin Medical Assistance Program
(MAP) cards, 40% are covered by personal or a spouse’s insurance, and one driver is a long time
People’s Community Clinic patient.
Drivers have no retirement. Unlike driver-owners in medallion cities that have the option of
transferring their permit at the end of their career, drivers in Austin have nothing to show for
experience or company loyalty. According to one twenty-year veteran, he couldn’t afford to quit
and planned on driving until he couldn’t drive any more.71
It is important to repeat that drivers are not covered by the insurance required by the
ordinances. The ordinance requires "the driver be insured under the franchise' insurance policy;"
the city auditor has noted that this arrangement warrants further consideration.72 On its face,
71 One long-term driver's daughter died and the cab drivers, not the franchises, pooled money and donated $700 to alleviate the cost of her funeral.
27
the ordinance appears to require that the driver be covered by insurance, but, in practice, the
transportation department approves policies that do not cover drivers.73 As soon as a driver is
involved in an accident, whether or not it is the driver's fault, the Driver Deposit balance is swept out
by the company. Unlike individual car insurance coverage, there is little incentive for the cab
companies to go after uninsured parties like an insurance company would. The driver handles any
personal injury claims he or she might have suffered alone. So, a driver who is rear-ended by an
uninsured motorist is just out of luck—no health insurance to cover a back injury and no auto
insurance attorney to fight for their claims.
WORKING CONDITIONS
In addition to working one of the most
dangerous jobs in the city, drivers are
subjected to extreme conditions when they
work.74 Several cab drivers in Austin have
been murdered while driving a cab. 75
Drivers generally cannot refuse to pick up
passengers.76
Currently, the ordinance does not
adequately protect cab drivers from passengers
who spit, vomit, or otherwise leave behind
bodily excrement in a taxicab.77 Instead, drivers
are forced to attempt to recover the lost income
caused by this behavior on their own (or
occasionally with police assistance). Drivers in
these not uncommon cases must get
professional cleaners to steam the cab and lose
income during the time it takes the car to dry
out and the odors to evaporate.
Austin taxi drivers did not perceive
problems in Austin that drivers in other
cities noted, such as large numbers of
bandit cabs, pay offs to hotel doormen, ethnic
slurs, or biased dispatch systems. Female
drivers interviewed did not complain about
sexism in the industry.
§ 13-2-346 REFUSAL TO
CONVEY PASSENGERS.
While operating a taxicab, a driver may
not refuse to convey a person who
requests service unless:
(1) the driver is engaged in answering a
previous request for service;
(2) the person requesting service is
disorderly;
(3) the driver has reason to believe that
the person is engaged in unlawful
conduct;
(4) the driver has reason to believe that
the safety of the driver or the taxicab
is at risk; or
(5) the person cannot present proof of
ability to pay the fare.
Source: 1992 Code Section 8-13-346; Ord. 031106-13;
75 Id.
74 Andrew Tran, Case Solved After 14 Years,
Ord. 031211-11
77 Patrick George, Fares Debated as San Marcos
Taxis Gain Accessibility, Austin American
Statesman, January 30, 2010, (San Marcos
The Daily Texan, October 15, 2004.
imposed a clean up fee of up to a $250.).
28
Relationships with Austin police
Taxi drivers in some cities, New York City in particular, have a controversial relationship with
the local police department. This does not appear to be an issue in Austin. Although, drivers do not
like to take abrasive drunks in their cars, police are helpful to drivers if someone tries to jump a
fare or someone throws up in a taxi.
Chief Acevedo put out a bulletin to
officers working on Halloween
night in 2009 to be on the lookout
for bandit cabs picking up
passengers without operating
authority in Austin. When interviewers asked about relationships
with the police, drivers perceived
officers as fair, but a few drivers
noted that some police officers
could be educated about where
taxi drivers can pick up and drop
off passengers.
§ 13-2-52 LOADING
AND UNLOADING.
A driver may not load or unload passengers in
the roadway of a street, but shall drive to the
right-hand sidewalk as nearly as possible,
except on one-way streets where passengers
may be discharged at either the right-hand or
left-hand sidewalk, or at the side of a roadway
without a sidewalk.
Source: 1992 Code Section 8-13-52; Ord. 031106-13; Ord. 031211-11.
Relationships with Aviation and
Transportation Department
Personnel
Drivers do, however, perceive
some problems with other city
staff, especially at the airport.
Some drivers characterized airport
personnel as rude and dictatorial.
Airport operations have reduced
the days and times that a driver
can buy an airport access card.
An access card is used to pay the
city’s airport surcharge. Drivers
complain about dirty bathrooms
and lack of butane in the heaters at
the airport waiting facility.
Drivers
reported
fewer
difficulties with transportation
29
department personnel. Transportation
enforcement officers have limited authority.
They use discretion in issuing citations.78
One driver said he was followed by a
transportation enforcement officer, pulled
over, and told to use a blinker. Since the
officer has no authority beyond a citizen on
such a violation,79 the officer instead stated
that he would call the franchise holder and
report the driver. A Public Information Act
response indicated the Department always
calls Austin Cab to report issuing a citation to
a driver.80
Marginalization of Drivers
Drivers noted that they lacked a voice in
decisions that impacted their livelihood.
There have been a few efforts over the decades
to organize a driver association but the efforts
have not previously succeeded. At a recent
organizing meeting of the TDAA, drivers
from Austin Cab were given a round of
applause for showing up despite threats
of termination. Because of bias in the
ordinance toward franchise holders, drivers
have no seat at the table in discussions of
industry matters.
DRIVERS
NOTED THAT THEY
LACKED A VOICE
IN DECISIONS THAT
IMPACTED
THEIR LIVELIHOOD.
79 Austin City Code § 13-2-14(c)(2).
80 Public Information Act Response, December 4, 2009.
30
WAITING TO TRANSPORT ARRIVING AIRPORT PASSENGERS
Passengers at Austin Bergstrom International Airport (ABIA) only see a queue of a few cabs
outside baggage claim exits. However, the taxi staging area just off the main entrance often has
50-80 cabs waiting for a fare. The 10% drop in passengers in the past year has resulted in drivers
commonly waiting over two hours. Drivers hope to get a fare that makes the wait worthwhile, a
gamble because drivers are obligated to take a passenger regardless of the length of the trip.
A dollar surcharge is added to every airport pick up. Federal law requires airport surcharge revenue
may only be used at ABIA. In 2008, taxi surcharges resulted in $378,644 of revenue.*
Some drivers reported waiting
five hours for a single fare from
the airport during the
Thanksgiving holidays in 2009.
Drivers pass the
hours reading,
talking, sewing,
playing cards,
napping, and
cleaning their
vehicles.
The holding area is simply a lot where cars line up based on order of arrival. There is no shelter
for the drivers to seek protection from inclement weather and they are subjected to the heat and
the cold. The alternative is to sit in their cars with the motor running, a poor environmental
practice. Dallas and Houston offer indoor facilities for taxi drivers waiting at the airport.
Just recently, the City of Austin committed to building a $2.2 million facility at ABIA.**
* Public Information Act Response, August 29, 2009.
** City Council Resolution 20091001-036, January 21, 2010.
31
The bathrooms are prison style with metal
toilets on each side.
In the winter, taxi drivers can crowd around
heaters that only emit a small amount of warmth
a short radius. These heaters are not always
functional and often have insufficient fuel. The past
summer saw 65 days with temperatures over
100 degrees. The staging area has little shade and
no place to escape the heat.
Drivers pitched in to provide the single tiny
microwave that sits outside the bathrooms.
Vendors sometimes enter the lot to offer drivers
food while they wait. Picnic tables are metal.
The staging area lacks an accommodation
for religious practices. Drivers who pray
regularly kneel down on concrete islands
without privacy, overhead cover, or adequate facilities for ritual needs.
PART IV:
UNREGULATED COMPETITION
35
PART IV: UNREGULATED COMPETITION
Other forms of vehicles for hire are a large and growing segment of the market. There is no
restriction on their growth and limited consumer protection on fares.81 Other vehicles for hire
include SuperShuttles (which can carry up to 15 passengers), limousine services, and pedicabs.
The numbers do not include courtesy shuttles. Some of these vehicles for hire compete directly with
taxi drivers for airport and downtown transportation.
Austin has a large volume
of pedicabs. Arlington,
Boston, Dallas, New York
City, San Antonio, San Diego,
and several other cities have
passed ordinances to limit
pedicab market saturation.82
Austin has taken no such
action. In Austin there are
187 pedicabs and 669
taxicabs which is the highest
taxicab to pedicab ratio we
have found in the country.83
Pedicabs provide only a short
trip transportation option.
One member of the Urban
Transportation Commission
commented in a meeting recently that taxi drivers do not want short trips and the driver was
unhappy when the commission member did not want to go very far. However, drivers dispute that
attitude. One veteran driver said that cab drivers prefer a trip from downtown to Lakeway, but
they want anything they can get. And she added, “those vehicles take drunks to their cars; cabs take
them home.”
Pedicabs are fair weather vehicles for hire and not an integral part of the transportation system
of the city. They show up en masse during music events and University of Texas football games,
but can scarcely be found in inclement weather. Based on our inquiry to local pedicab companies,
they charge leasing fees, generally below $40 a night, and Austin pedicab drivers often take home
81 Airport Shuttle services & charter services have fare regulations. Austin City
August 2009; Pedicab Service, San Antonio City Council, 2009; San Diego
City Council Puts Breaks on Pedicabs, Sign on San Diego, July 2009.
Code § 13-2-211.
82 Pedicab and NEV-for Hire Ordinances, Arlington City Council, December
83 Public Information Act Response, December 4, 2009.
2009; Interim Regulation for Pedi-cabs, Boston Police Department,
November 2007; Rickshaw-Reminicent Pedicabs Cycle Past Novelty Status,
USA Today, January 2004; Pedicab Licensing, The New York City Council,
PART IV: UNREGULATED COMPETITION
36
several hundred dollars in a single evening.84 When there is a special event in Austin, such as Austin
City Limits, pedicabs can “rake in about $1000 a night.”85 Furthermore, in Austin, the ordinance
does not regulate an amount of fare a pedicab driver may charge a consumer, but permits the
driver to work for "tips only,"86 which may give the unsuspecting customer a false sense of value.
Without consumer protections, this
system can result in a virtual
shakedown of customers at the end
of the ride. San Antonio, in
contrast, requires that pedicabs post
fares conspicuously on each vehicle
and that pedicab companies file a
schedule of fares with the
department of transportation.87
Although pedicabs are marketed
as “green transportation,” the
unregulated “market-driven” approach
to this type of vehicle for hire has
limited environmental advantages.
Pedicabs generally do not take
vehicles off Austin streets since the
customer is often only traveling a
short distance to their car and does
not feel like walking.
VEHICLES FOR HIRE IN AUSTIN*
* does not include hotel courtesy shuttles
** One Supershuttle can commute 15 persons.
84 January 2010, Capital Pedicab, Roadkill Pedicab, Metrocycle Cab.
85 Austin companies offer easier transportation to ACL, News 8 Austin, September 2009.
86 Austin City Code § 13-2-272; § 13-2-273.
87 San Antonio City Code, Article VI. Sec. 33-625.
PART V:
RECOMMENDATIONS
39
PART V: RECOMMENDATIONS
WE BELIEVE THE AUSTIN CITY COUNCIL
SHOULD CONSIDER
THE FOLLOWING RECOMMENDATIONS:
1. The City Council should undertake a study of the taxi industry in
Austin and its contributions to the transportation system.
2. The City Council should comprehensively reexamine the ordinances
regulating transportation and vehicles for hire prior to considering
franchise applications and renewals. This review should include
the following issues: permitting allocation formula, rate increase
process, driver job security, living wage, vehicle and driver insurance
coverage, health and workers’ compensation insurance coverage,
permit transference, fees, and permitting and regulation of other
types of vehicles for hire.
3. The City Council should protect drivers who want to organize
from retaliation and consider amendments to the ordinances to
require driver participation in decisions that affect their livelihood.
PART VI:
APPENDIX
43
PART VI: APPENDIX
METHODOLOGY
Many other cities are taking notice of the dismal working conditions of taxi drivers across the
country. Inspired by their research, Legal Aid staff and volunteers began conducting surveys of local
drivers in November 2009 and continued through January 2010. In an effort to simulate research
done elsewhere, we used multiple methods to gather information. We conducted standardized
surveys of 66 taxi drivers operating taxicabs authorized in the City of Austin. When time permitted
and drivers were willing, we followed up with in-depth interview questions. Drivers were
interviewed at either: 1) the airport taxi staging area, 2) hotel taxi waiting zones, 3) legal offices by
appointment, or 4) another location, such as the Greyhound Bus station waiting area or downtown.
We conducted a few non-random interviews with veteran drivers for additional background and
history of Austin taxi operations. No taxi drivers interviewed other drivers. We supplemented our
in-person research with examination of academic literature, reviews of the laws that regulate the
industry in Austin and other cities, public information, and other literature on the taxi industry. The
process was time consuming and not without its struggles, but we believe the information in this
report gives an accurate depiction of what it is like to be a taxi driver in Austin, Texas.
SURVEY
The 66 interviewees is equivalent to 10% of all permits issued in Austin and approximately 8%
of estimated drivers in Austin. We interviewed 29 drivers (44%) at the ABIA taxi staging area, 15
drivers (23%) waiting at hotels, 15 drivers (23%) at our office, and the remaining 7 drivers (11%)
were interviewed at other locations (such as downtown or at bus stations).
Of all the drivers interviewed, approximately 36 worked for Yellow Cab (55%), 20 worked for
Austin Cab (30%) and 10 worked for Lone Star Cab (15%). Yellow Cab drivers receive a higher
number of fares from dispatch so are slightly less common at the airport or taxi waiting zones.
Only three of those interviewed were TDAA officers, one of them simply a random airport
interview. Below, the diagram compares the proportion surveyed to the percentage of permits each
franchise possesses.
Cab
Company
# Permits
Issued
% of All
Permits
# Interviewed
% Interviewed
Yellow Cab
455
68%
36
55%
Austin Cab
159
24%
20
30%
Lone Star Cab
55
8%
10
15%
44
PART VI: APPENDIX
In order to deal with the inherent risk that self-reporting would not be accurate or truthful,
we told all respondents that their answers would be anonymous and we would keep no
identifying information. The fear of retaliation by a franchise is very real in Austin, thus the
promise of anonymity was important for all drivers, knowing that if they were identified in the
survey they could lose their livelihood.
IN-DEPTH INTERVIEWS
In addition to surveys, we conducted in-depth interviews with 25 drivers (38%). Depending on
time and conditions, some random drivers were asked to answer additional questions in an
open-ended interview format. Non-random selection of a few drivers was based on driver tenure
and experience to understand a fuller breadth of working conditions and why a driver continues
to drive a taxi. Only one driver indicated the income we calculated did not match his experience.
All information (if any existed) that could identify these participants was destroyed.
OTHER RESOURCES
Advancement Project, Dispatching Injustice: Cab Drivers Struggle in Prince George’s County,
July 2009.
Biju Mathew, Taxi!: Cabs and Capitalism in New York City, (The New Press 2005) (2005).
The Community Development Project of Urban Justice Center, Unfare, Taxi Drivers and the Cost
of Moving the City, September 2003.
Dr. Robert Bruno. Driven Into Poverty: 2008 Comprehensive Study of the Chicago Taxicab Industry,
2008.
Gary Blasi and Jacqueline Leavitt, Driving Poor: Taxi Drivers and the Regulation of the Taxi Industry
in Los Angeles, 2006.
Graham Russell Gao Hodges, Taxi!: A Social History of the New York City Cabdriver, (The Johns
Hopkins University Press, 2007) (2007).
NLRB v. Friendly Cab Co., 512 F.3d 1090 (9th Cir. 2008) (holding that taxi drivers were properly
ruled employees instead of independent contractors).
Sara Abraham, Aparna Sunder & Dale Whitmore, Toronto Taxi Drivers: Ambassadors of the City,
A Report on Working Conditions, January 2008.
Schaller Consulting, Higher Pay, Safer Cabbies: An Analysis of the Relationship Between Driver
Income and Taxi Crashes in New York City, January 2004.
DRIVING AUSTIN,
DRIVING INJUSTICE
LEGAL ASSISTANCE TO
Texas RioGrande Legal Aid
4920 N. IH-35, Austin, Texas 78751
email: [email protected]
web: www.texascbar.org
© 2010 Texas RioGrande Legal Aid

Driving Austin, Driving Injustice - Taxi Drivers Association of Austin

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