Ghana-born John Aikins has been a cab driver in Chicago for two decades. About 15 years ago, he decided to go into business for himself by taking out a loan with his wife to purchase a medallion—a city-issued license to operate a taxi—for $70,000. Paying it off within a few years thanks to a steady stream of passengers, they took out loan for a second medallion five years ago, using the first as collateral.
his medallions appreciate in value over the years, Aikins planned to
eventually sell or lease them to other drivers, a common practice in
the industry. “I hoped it would be my retirement investment, and I
had planned to retire this year,” Aikins told In
with the introduction of Uber and other rideshare companies to the
city—which can operate without the expensive, city-issued
medallions—Aikins has seen his clientele plummet over the past
three years, making it increasingly hard to keep up with his
medallion loan payments.
the city, the number of taxi rides dropped from 2.29 million in
January 2014 to 1.1 million in January 2017, according to
a report released
recently by Cab Drivers United, AFSCME Local 2500 (CDU).
As a result, the average monthly income per medallion has fallen by
$2,000 during the same time.
to the end of last year, things had changed so drastically,” Aikins
said. “We just couldn’t make it.” After recently receiving a
notice of foreclosure on his medallions, his retirement plans are now
is hardly alone. In the past three years, more than 1,300 taxi
medallions in the city have either been surrendered to the city or
put into foreclosure status, while another 100 or so are facing
repossession through lawsuits by lenders, according to the CDU
foreclosure crisis is hurting small family businesses most of all,
CDU contends. Of the 6,999 taxi medallions in the city, 39 percent
belong to small owner/operators, like Aikins, who own four or fewer
of the misconception that the taxi industry is just big fleets, the
fact that thousands of small businesses are disproportionately being
hurt by this crisis is too often overlooked,” said Tracey Abman,
associate director of AFSCME Council 31. “The taxi industry is
really about providing decent, full-time jobs—or was—for
addition to repaying loans on their medallions, taxi operators also
have to pay thousands of dollars each year in city expenses, like the
ground transportation tax and medallion license renewal fee—expenses
that rideshare drivers are not subject to.
says the number of rideshare vehicles in Chicago now exceeds 227,000,
while 42 percent of the city’s taxis didn’t pick up a single
passenger this March. The union stresses that the decline of the taxi
industry is a loss for the broader public. Unlike most rideshare
vehicles, taxis serve people without bank accounts by accepting cash,
and they also have more stringent requirements on providing access to
people with disabilities.
says he doesn’t fault the rideshare industry for his current
predicament, but instead blames the city.
are so saddled with rules and taxes and renewal fees, and the city
hasn’t done anything to relieve us,” he said. “It looks like
they are just waiting for us to die off.”
summer, the City Council was poised to pass new regulations on
rideshare companies, which CDU hoped would help create fairer
competition. The original ordinance would have required fingerprint
background checks on rideshare drivers and would have mandated that
at least 5 percent of all rideshare vehicles be
wheelchair-accessible—rules comparable to those imposed on the taxi
the last-minute intervention of Mayor Rahm Emanuel, however,
version of the ordinance was passed that removed the
original provisions on fingerprinting and wheelchair accessibility.
While the final version requires rideshare drivers to obtain special
chauffeur licenses, it allows them to complete the necessary training
online instead of through the expensive in-person classes taxi
drivers must attend.
have accused Emanuel of being biased in favor of rideshare companies,
particularly Uber. His brother Ari—a Hollywood agent and the
inspiration for Jeremy Piven’s character on HBO’s Entourage—is
an Uber investor. Also, the mayor’s former chief of staff became
an Uber executive not long after passage of last year’s
ordinance. Earlier this year, Emanuel’s Obama administration
colleague and former Uber executive David Plouffe was
fined $90,000 by the Chicago Board of Ethics after it was
revealed he illegally lobbied the mayor on behalf of the rideshare
giant in 2015.
no help from the city, Aikins turned to Cab Drivers United for
assistance after receiving his foreclosure notice. Formed in 2014,
CDU is a non-traditional union in that it does not bargain contracts,
since labor laws classify taxi drivers as “independent contractors”
rather than “employees.” Made up of hundreds of dues-paying
members and a network of thousands of activists, CDU provides
educational workshops for drivers, connects them to legal services
and organizes them to pressure lawmakers for fairer treatment.
Mohammed, a private attorney whose firm partners with CDU, said he
has talked with over 100 owner/operators like Aikins facing
foreclosure in recent months.
of these drivers will owe upwards of $250,000 on these medallions,
yet the underlying asset is worth maybe $50,000 if you can even find
a willing buyer,” he said.
CDU’s help, Aikins contacted an attorney who recently helped him
file for Chapter 13 bankruptcy in an effort to save his livelihood.
Mohammed said his law firm is assisting many owner/operators to
restructure their medallion loans, but he called it only a “temporary
CDU is calling on the city to ease the financial burdens of taxi
drivers, including eliminating the medallion license renewal fee and
waiving the ground transportation tax for struggling owner/operators.
ground transportation tax—paid once every two years—is due at the
end of June. Aikins said the tax for two years is about $2,000.
doesn’t make sense,” he said. “The city knows we don’t have
the city were to create a hardship waiver for the ground
transportation tax literally in the next few weeks, that would send a
signal to these small owner/operators that the city does care about
them and is prepared to work on a more comprehensive package for
reform,” AFSCME’s Abman said.
relief is not provided [in the coming weeks] we will see much more
decimation of the industry,” she warned. “Time is of the
>> The article above was written by Jeff Schuhrke, and is reprinted from In These Times.