Los Angeles council puts taxi refranchising RFP back to committee after lengthy public hearing

The Los Angeles City Council on Feb. 22 referred a proposed request-for-proposals (RFP) to re-franchise taxi service in the city back to the Transportation Committee after an extended public hearing and debate over service areas, alternative fuels and enforcement.

The measure, introduced by Department of Transportation staff and the Taxicab Commission, would authorize a new set of five-year franchises (with possible annual extensions) and require computerized dispatching, data reporting and other performance requirements from franchisees. Council action at the meeting sent the entire matter back to committee for further refinement; the motion to refer passed on a council roll call and was recorded as 14 ayes.

Why it matters: Council members and dozens of speakers, including drivers, fleet owners and fuel suppliers, framed the refranchising as a decision that would affect service coverage across Los Angeles, the economic prospects of owner-drivers and the city's air-quality goals. Several council members emphasized that issuing an RFP now should not preclude later council-level policy choices on staging, alternative fuels or fleet size.

Key points and details presented at the meeting: - Department of Transportation General Manager Frances Banerjee and assistant general manager James Okazaki described the RFP's core features: a requirement that franchisees use a digital computerized dispatching system to provide trip-level data to the city; a cap on the largest operator at 35% of authorized cabs; a minimum franchise size of 70 cabs; and no net increase in the currently authorized 2,303 cabs. Okazaki said the refranchising term would be five years with possible annual extensions for up to five additional years. - The RFP would require credit-card acceptance by cab companies and create monetary penalties for violations of franchise rules. Staff said the dispatch data would be used to measure coverage and response times throughout the city. - Councilwoman Ruth Galanter offered an amendment (10a) to incentivize alternative-fuel and low-emission vehicles (CNG, ULEV/SULEV or other technologies), including reserving a portion of authorizations and waiving fees as an incentive; that proposal drew strong support from industry and environmental speakers but also concern from some council members and operators about costs, staging and operational impacts.

Public testimony ran more than an hour and included drivers and fleets with operating experience using compressed natural gas (CNG) and low-emission vehicles. Speakers included environmental advocates, Southern California Gas Company, Pickens Fuel Corp., Ford Motor Company, and operators such as American Taxi and LA Taxi. Ed Begley Jr. urged council members to "please support this measure" and said "natural gas vehicles work." Drivers and fleet managers described successful CNG demonstrations in other cities and urged incentives rather than mandates.

Several council members urged caution on major policy changes within the RFP itself, recommending that certain policy issues be worked out either by the Taxicab Commission or in committee before final awards. Concerns included preserving service levels in transit-dependent neighborhoods, the potential for larger companies to displace smaller owner-operators, and the need for clear, publishable performance criteria (for example the existing board rule the staff cited that 75% of calls in any primary area must be answered within 15 minutes).

What the council decided and next steps: The council voted to refer the matter back to the Transportation Committee for further work on the RFP and outstanding amendments. Committee review is intended to allow the Taxicab Commission, DOT staff, and council members to refine performance metrics, staging/flagging rules, and any incentive structure for alternative fuels before final franchise awards. No franchises were awarded at the Feb. 22 meeting.

Quotes from the record: "We're going to ask the contractors, our taxi providers, to have a digital computer dispatching system," said James Okazaki, assistant general manager of the Department of Transportation. Ed Begley Jr., a public speaker, said, "Natural gas vehicles work. Please support this measure."

The referral preserves multiple policy options (including the Galanter amendment on incentives) while directing additional committee work to clarify performance measures, enforcement and the timing of any staging/"open city" privileges.