Council sends taxi refranchising RFP back to committee after debate over alternative-fuel incentives

The Los Angeles City Council on Feb. 22 heard a staff presentation and many public commenters on a proposed request for proposals to refranchise taxi service in Los Angeles, then voted to refer the item back to the Transportation Committee for further work.

The Department of Transportation presented the refranchising plan, led by Frances Banerjee, general manager of the Department of Transportation, and James Okazaki, assistant general manager. The staff described key elements of the draft RFP: a requirement that franchisees install computerized dispatching and automatic trip data reporting; monetary penalties for violations; credit-card acceptance; a cap that no single operator may control more than 35 percent of the citys authorized fleet; a minimum franchise size of 70 cabs; no recommended increase in the total authorized fleet (2,303 cabs); and a five-year franchise term with potential annual extensions for up to five additional years. Staff said the refranchising is intended to improve service coverage and make performance measurable through dispatch data.

The proposal included a new service type (a shared-ride product) and sought to modernize long-standing franchise language that staff said had not been comprehensively updated in 20 to 25 years.

The hearing drew extensive public comment on alternative fuels. Several speakers urged the council to include incentives for low-emission and alternative-fuel vehicles in the RFP. Commenters who identified industry or technical roles included Rick Price (Southern California Gas Company), Cindy Sullivan (South Coast Air Quality Management District), David Haridon (representing Pickens Fuel Corp.), and Edrick Guise (Ford Motor Company). Drivers and fleet managers from American Taxi, LA Taxi and other companies described operational experience with compressed natural gas (CNG) or other low-emission vehicles; for example, driver Kevin Phillips said he had driven a natural-gas taxi "6,000 miles a month" without fueling or maintenance problems, while Rick Schorling, president of American Taxi in Orange County, said his company had operated a 100 percent natural-gas taxi fleet for eight months without problems.

Other public speakers warned of risks to independent owner-operators. David Shapiro, speaking on behalf of taxi drivers' interests, urged caution, saying a franchise model could continue practices that make it hard for drivers to earn a living. Former and current owner-drivers and managers raised concerns about service in peripheral areas (the transcript referenced areas A through E and specifically Area E/Harbor service) and about fare-setting, deadheading, and the value of existing shares while the RFP process runs.

Council debate focused on several contested items: whether the council should approve the RFP as drafted by the Board of Taxicab Commissioners and let the board and the department work out implementation details before awarding franchises (a position urged by the Transportation Committee chair), or whether the council should adopt amendments on the floor. Councilmember Ruth Galanter introduced amendment 10a to add incentives for alternative-fuel or ultra-low-emission vehicles (the motion was framed as fuel-neutral but designed to encourage alternative fuels), including a 5 percent allocation targeted to low-emission vehicles and other incentives (for example, waiver of certain inspection fees and other concessions described in the amendment). Other councilmembers, including those representing taxi-dependent neighborhoods, urged protections to prevent franchisees from abandoning service in harder-to-serve areas and pressed for clear criteria for any "staging" or flag-down privileges outside a grantee's primary service area.

Staff and commissioners acknowledged operational concerns and recommended several safeguards. DOT said it had examined senior voucher and city-ride programs and planned program changes to avoid creating administrative burdens that encourage drivers to refuse voucher passengers; DOT said a pending revision to the city ride (voucher) program would pay an increment to cover administrative processing costs and that disciplinary procedures for confirmed refusals already exist.

Legal and procedural questions also shaped debate. Council discussion noted language in the Administrative Code and the city charter about the Board of Taxicab Commissioners' role and time periods for action; council members debated whether adopting certain committee amendments on the council floor would require a supermajority (twelve votes) or a simple majority (eight votes). Councilmembers also discussed the 120 taxi authorizations (often referred to in testimony as "120 seals" or medallions) that had been authorized by an earlier council action and whether those authorizations were currently allocated or unallocated for the purposes of incentive language; Councilmember Pacheco sought assurances that allocations intended to benefit a specific area (Area C in the record) would not be given away if the council adopted alternate incentive language.

Rather than adopting the RFP or any amendment on final passage, the council voted to refer the entire refranchising matter back to the Transportation Committee so the committee could reconcile outstanding amendments, operational details and enforcement criteria before the RFP is issued or franchise awards are made. The referral motion was made by Chair Savornich and seconded by Councilmember Wax; the council voted 14 ayes and the matter was returned to committee.

What happens next: the Transportation Committee will reconvene to consider the array of amendments (including the proposed alternative-fuel incentives and the committees own package). The Board of Taxicab Commissioners, DOT staff and stakeholders (drivers, operators and environmental and industry representatives) were asked to work with the committee to produce concrete criteria for staged/shared service, performance measurement, enforcement thresholds and how any fuel-incentive program would be implemented and funded.

Speakers quoted in this report are drawn from the public record at the Feb. 22 council meeting and are attributed to the roles or affiliations they gave at the time of testimony.