The de Blasio administration is facing intensifying pressure to provide financial relief for cab drivers who got caught in the taxi medallion crisis, following a rally in front of City Hall on Thursday.
Mayor Bill de Blasio earlier this week issued a host of recommendations to help reign in abuse (mainly by medallion brokers) in the taxi industry but stopped short of proposing a bailout plan. The mayor’s report came out of a 45-day review that was spurred by a New York Times investigation, which revealed the factors, including the complicity of city and regulatory officials, which over a decade led to medallion prices to soar to more than $1 million before crashing in 2014. Today, the value of a medallion is estimated as between $150,000 and $200,000, according to the New York Taxi Workers Alliance.
De Blasio has maintained that a bailout would be too expensive for the city, with his office recently estimating the cost at $13 billion.
Critics have pounced on that number as exaggerated. They have also pointed out that the city had a hand in the crisis, which disproportionately affected immigrant drivers, many of whom unwittingly signed on to exploitative interest-only loan deals which came with large fees and unfair terms.
“It’s outrageous to say it would cost the city $13 billion dollars to fix this problem, that’s a fabricated number,” said Mark Levine, a City Council member who spoke at the rally, which drew roughly 50 taxi drivers and supporters.
Bhairavi Desai, leader of New York Taxi Workers Alliance, which represents medallion owners and drivers who work for taxi fleets, has said a bailout could cost between $1.8 billion and $2.7 billion.
Referring to the 2008 housing mortgage crisis, Levine added: “The fact is, there is a myriad of precedents for this here in New York City, and it’s simply inexcusable to say this is impossible, when we have done projects like this in the past and there is no reason we can’t and shouldn’t do it again.”
Thousands of NYC taxi owner-drivers are facing financial ruin because of the medallion mortgage scandal. NYC had a direct role in this crisis & has an obligating to help relieve the pain of theses drivers. Proud to stand w/ @NYTWA to demand help from those who cause this crisis. pic.twitter.com/hMJ3tfsU5B
— Mark D. Levine (@MarkLevineNYC) July 11, 2019
Reached for comment, Seth Stein, a spokesman for de Blasio, referred to the mayor's statements during an unrelated press conference on Monday when he was asked about a possible bailout for the taxi industry.
"The honest truth is, it’s something we can’t reach," de Blasio replied. "We do not have the capacity as a city to provide that. I wish we did, but we don’t—that’s just the truth.”
Last month, de Blasio announced that the city would waive $10 million in fees for medallion owners and offer drivers financial and mental health counseling.
Levine said he strongly supports a plan to force lenders to sell the mortgages to the city at “steep discounts.” The city could then refinance the loans to drivers on favorable terms, he said. According to the city, the average outstanding loan on a medallion is $500,000.
Other councilmen, including Ydanis Rodriguez, Ritchie Torres, and Brad Lander, have said they supported a bailout that would target individual driver owners — numbered between 4,000 and 6,000 — and not fleet owners.
Scott Stringer, the city's comptroller, has also come out in support of at least a partial bailout.
In the wake of the scandal, many medallion owners have come out and spoken publicly about their heavy debt and the toll it has taken on the lives. Among the cabbies at the rally, Mohammad Mahbu, who immigrated from Bangladesh, said he has been driving a taxi since 1997 and currently owes $650,000 on his medallion.
“My family is crushed,” he said. “I want a life back.”
With Xavier Rubira