HomeMy WebLinkAbout10-20-2015 Item 13 - Yellow Cab Taxi Purchase of 234 Taxi LLC
Meeting Date: 10/20/2015
FROM: Daryl Grigsby, Public Works Director
Prepared By: Gamaliel Anguiano, Transit Manager
SUBJECT: YELLOW CAB TAXI PURCHASE OF 234 TAXI LLC
RECOMMENDATION
Approve transfer of 234 Taxi’s Certificates of Public Convenience and Necessity to Yellow Cab.
DISCUSSION
Background
The City of San Luis Obispo has four taxi cab companies authorized to operate within the City
limits. These include; 234 Taxi LLC, Surf Cab, Tri-Counties Transit (Operating as Yellow Cab
of SLO), and A Ride Awaits. As of August 1st, however, A Ride Awaits voluntarily relinquished
their Certificates of Public Convenience & Necessity (CCN) stating, “the ever increasing
presence of UBER has led to a decline in that market share…” as the reason for their inability to
continue operations within the City. They subsequently have stopped operating in the City.
Recently, a second taxicab company has also come forward stating a similar decline in business.
In an email to staff, 234 Taxi LLC comments, “In the span of the last year I have watched my
call volume drop 50%. The loss of business is due to UBER. It is impossible to compete
against.” As a result, 234 Taxi owners have decided to stop operating taxi cab service in the City.
Instead, 234 Taxi and Tri-Counties Transit have reached a mutual agreed upon deal to buy-out
234 LLC’s operation and take over their authorized permits.
This purchase would leave two taxi operators authorized to operate within City limits; Tri-Cities
Transit and Surf Cab. The purchase of 234 Taxi by Tri-Counties Transit also comes with the
request that 234’s ten authorized CCNs be transferred to them. In turn, Tri-Counties Transit will
continue to operate 234 Taxi branded taxis as a subset taxi operation.
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Table 1- Current City Taxi Operations
Company Authorized Date In Use
234 Taxi LLC 10 7/21/2009 9
A Ride Awaits 5 11/10/2014 1
Surf Cab Co. 5 1/19/2010 5
Tri – Counties
Yellow Cab Co.
20 9/21/2010 17
Total: 40 32
Table 2- New City Taxi Operations
Company Authorized Date In Use
Surf Cab Co. 5 1/19/2010 5
Tri – Counties
Yellow Cab Co.
30 9/21/2010 17(+unknown)
Total: 35 22(+ unknown)
Municipal Code
Pursuant of Section 5.20.060 of the City Municipal Code, the Council may award taxi permits to
qualified applicants “if the council determines that the public convenience and the necessity
requires additional service, it shall determine the number of taxicab permits which shall be
necessary to furnish such services. The Council may award such additional taxicab permits to
existing holders of certificates of public convenience and necessity or to any new applicants who
are qualified for issuance of certificates of public convenience and necessity.”
Based upon the record of Tri Counties Transit and the continued need for taxi services, staff is
recommending that Council approve the transfer of the taxi certificates to Tri Counties Transit.
Uber & Other Peer to Peer Services
The issues regarding appropriate regulation of Uber, and like services, continues to be debated at
national, state and local levels. The “sharing economy” business model of Uber, and others like
it, does not fit definitions for a taxi cab company. The State of California has already legislated
how to regulate these service providers and has legislated that all regulation be solely conducted
by the State Public Utilities Commission.
The California Public Utilities Commission (“CPUC”) has created a category for “New Online
Enabled Transportation Services” which are referred to by the CPUC as “Transportation
Network Companies” (“TNCs”). Companies like Uber, Lyft, SideCar and InstantCab fall within
this category. The CPUC has asserted statewide jurisdiction over TNCs and has claimed that any
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local regulation over such companies is preempted. As such, the City does not have the authority
to further regulate such companies. The CPUC’s 2013 ruling regarding TNCs can be viewed
here:
http://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M077/K192/77192335.PDF”
FISCAL IMPACT
The monitoring of taxi cab companies falls under purview of the Transit Division. Staff,
specifically the Transit Coordinator, maintains regular communication and records associated
with monitoring taxi cab companies. These activities have no impact on the General Fund and
are accounted and budgeted for in the Transit Enterprise fund.
ALTERNATIVES
1. Deny transfer of CCN’s, although this is not recommend as it could create a shortage of
taxi cab options for residents.
2. Approve transfer of CCN to Yellow cab in a different quantity, although this would limit
the opportunity to grow taxi cab services to residents.
Attachments:
a - 234 Taxi Correspondence
b - A Ride Awaits Taxi Correspondence
c - TRI Counties Transit Inc. Correspondence
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1
Goodwin, Heather
From:Slocap234@yahoo.com
Sent:Tuesday, September 15, 2015 8:31 AM
To:Anguiano, Gamaliel
Subject:234taxi
Sent from my iPhone
Sent from my iPhone
Thank you for the opportunity to serve the citizens of San Luis Obispo. However It is time for me to step aside from the
taxi industry.
Tri Counties Transit has offered to buy my taxicabs and keep my drivers employed. Please allow this to happen.
I started 234-taxi in 2001. One taxicab, just me. I rolled every dollar of profit for more that a decade into building and
expanding my business to 12 taxis. 25+ drivers, 5 office staff and myself.
In the span of the last year I have watched my call volume drop 50%. The loss of business is due to UBER. It is
impossible to compete against. My costs to operate under regulators is enormous. They operate free of regulation and
cost. No one can or is able to explain to this American (me), why I am regulated and they are not.
I don't blame UBER. Where are the regulators? Why does the IRS call a UBER transaction a sharing and my transaction
business. Why does the CHP consider their transactions personal and my transaction commercial? Where are the city
regulators? Lord knows they were in my business every day while ignoring illegal practices by UBER. I am done being a
part of the most unfair system ever.
It has been a pleasure to serve the citizens of San Luis Obispo. Thank you to the people of San Luis Obispo for your
patronage.
Leland Stanford Simpson IV
Owner 234-TAXI
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Goodwin, Heather
From:Dan Indendi <arideawaits@yahoo.com>
Sent:Tuesday, July 14, 2015 7:46 PM
To:Ashbaugh, John; Marx, Jan; Carpenter, Dan; Christianson, Carlyn; Rivoire, Dan; Anguiano,
Gamaliel; Lawson, Dee; Grigsby, Daryl; Bochum, Tim; AgCommSLO@co.slo.ca.us; Lichtig,
Katie
Subject:Voluntary revocation of Taxi Permit
Mayor Marx , City Council Members and all others concerned,
I am requesting the withdrawal of our Certificate of Public Necessity and Convenience (Taxi Permit) effective
August 1, 2015. I would like to thank the city council for an opportunity to operate in the City of San Luis
Obispo. A brief reason for this request is outlined below.
Since our start within the city we were able to gain a good market share. However, in the last few months the
ever increasing presence of UBER has led to a decline in that market share. Not only has UBER taken some of
the already garnered share from us, but they continue to take additional market shares available. I welcome
competition as part of a free market system; however, that competition must be on the same playing field.
With driver permit fees, vehicle inspection fees, business license fees, county weights and measure fees,
commercial insurance with the city named as additional insured (all of which UBER is not held to) as well
increasing the amount of UBER cars in town it is no longer fiscally prudent to continue operations in the City of
San Luis Obispo. I hope that the remaining companies can continue to operate and service the residents and
visitors with permitted and licensed taxi’s well into the future.
Again, I would like to thank the city council as well as the members of the Public Works staff for all of their
work and consideration in allowing us to operate in the City of San Luis Obispo. If in the future the city
regulations are changed so that taxi operators and UBER are allowed to operate on the same plane (ie:
regulation and fees) I would like to be considered to restore operations in the city.
Thank you,
Dan Indendi, Owner
A Ride Awaits
805-975-8294
arideawaits@yahoo.com
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Tri Counties Transit, Inc.
202 Tank Farm Rd
San Luis Obispo, Ca 93401
(805)543-1234
September 9th, 2015
City of San Luis Obispo
990 Palm St.
San Luis Obispo, Ca 93401
Mr.Gamaliel Anguiano Transit Manager
Re: 234 TAXI
Dear. Mr.Anguiano:
Per my telephone conversation with Ms.Dee Lawson, we have negotiated a
purchase agreement with Mr. Leland Simpson to buy certain assets of 234 TAXI
as follow:
The trade names 234 TAXI
Telephone numbers
Business licenses/permits
Vehicles
Goodwill/customer base.
I have reviewed the chapter 5.20 taxicab ordinance of the City of San Luis
Obispo and make sure that we comply with all the rules and regulations and
submit to you all the necessary documents to complete the application for a
business license.
We are proposing to operate the taxicab services from the existing facility in San
Luis Obispo.
Please accept this letter as a formal request to transfer the existing taxicab
permits from Mr.Leland Simpson to the: Tri Counties Transit,Inc and schedule
this matter at the earliest city council hearing.
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Thank you for your cooperation and consideration in this regard. Should you
have any further question please feel free to contact me at any time.
Most sincerely,
Masood Babaeian
Masood Babaeian
CEO
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