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Committee directs staff to extend petticab franchises for 5+5 years with rates to be set later
Summary
Faced with expiring franchise agreements in August, the committee voted to direct staff to pursue option one — extending petticab franchise agreements for a five-year initial term plus a five-year option, with rates to be determined later — after members debated rebidding and market-rate concerns.
The Traffic and Transportation Committee voted to direct staff to pursue option one on an ordinance amending petticab rules, extending existing franchise agreements rather than immediately rebidding or recalling them to the city.
Background and motion: legal staff presented two options because current petticab franchise agreements expire in August: (1) extend the franchises (described in discussion as “five and five”) with rates to be set by the committee or council later; or (2) take back franchises and start a new bid process. A committee member moved to approve option one, the motion was seconded and carried on a voice vote.
Debate: one committee member said earlier conversations had considered rebidding a portion of medallions periodically (for example, 20% every two to three years) to measure market value, arguing the city needs competitive bids to understand medallion value. Other members and staff replied that frequent rebidding would create business uncertainty for small operators who have invested in brick-and-mortar operations, leases and equipment, and that the committee could use the most recent medallion bid prices to calculate a blended market rate if needed.
Why it matters: committee supporters said extending franchises respects existing operators’ investments and continuity of service on the peninsula, while opponents argued periodic rebidding encourages competition and better price discovery.
Next steps and limits: the committee did not set the extension rates at the meeting; rates and any administrative details will be determined later by the committee and council following staff work. Staff was directed to proceed on option one and return with recommendations.
Speaker-attributed quotes “I don't understand how we're going to determine the market rate of what these medallions are worth if we don't bid them out,” a committee member said, urging consideration of periodic rebids. Defenders of extension said frequent rebidding would impose uncertainty on operators who have invested in facilities and leases and that extension is the better compromise.
Procedural note: the franchise agreements were described as expiring in August; the committee’s direction does not itself finalize contract terms or fees.
