The almost “death sentence” industry of yellow taxi drivers, one of the most powerful emblems of New York City, is closing a chapter this week that will allow hundreds of owners of medallions, (as they are known to permits to operate) receive a “lifeline”. This step comes after years in which crippling interest on loans to acquire these licenses led some to ruin. And, in the worst of extremes, to suicide.
Until this Friday 24 in September , these small entrepreneurs have a chance to close the restructuring of the medallion loans, with the companies FieldPoint, Marblegate and Da Palma, the three main lenders of funds for these permits.
“We want to make sure all eligible drivers get this life-saving, life-changing debt relief. Our members went on a hunger strike of 15 days to push and make this historic victory possible,” said Bhairavi Desai, director of the New York Taxi Workers Alliance (NYTWA).
Almost 1,000 drivers have already received a total of $200 millions in debt forgiveness.
They will pay much less
The program agreed with the City, through the Taxi and Limousine Commission (TLC), restructures the loans of taxi medallions so that they are backed up in case of default. Now most have a maximum principal balance of $170,000 and a maximum interest rate of 7.3%.
The current average debt that drowned the owners of the emblematic yellow taxi drivers is $550, with average monthly payments of $3,000. According to the final program, that loan moment was substantially reduced to $170,000, payable at $1,234 per month.
The final plan reflects an interest increase agreed in November of 2021 from 5% to 7.3 % because rates have gone up due to inflation, but now have a longer term of 20 years to 25 years to help offset some of that cost.
“This changes the future of this business. It is a testimony of the tireless organization of the 25, NYTWA member drivers to throughout the 29 days of protests the 24 hours a day, 7 days a week, arrests and a hunger strike of 15 days. When we fight, we win,” said Assemblymember Zohran Mamdani.
On the “via” other relief
Other proposals are on the way to improve the income of these taxi drivers, the TLC has just presented a new proposal that could be approved in October, which would approve an increase in the cost of traveling in a yellow taxi in the Big Apple, in about a 000 %. This would mean the first increase in taximeter markers in a decade.
Specifically, the base fare and surcharges for any trip would increase by $3.29 to $4.29. The driver’s pay would also increase by 29% and trips with fixed fare from John F. Kennedy Airport to Manhattan would go from $29 to $ 65.
The predictable response of thousands of regular users of taxi services is that on-demand transportation applications such as Uber and Lyft will continue to be, more and more, the cheapest option for those who need to move outside the Subway spectrum.
“ Obviously crime forces you to avoid trains when you leave work late. But this inflation affects us all. And a dollar or two saved on a trip is something. And the yellow ones are obviously more expensive,” says Mildred Mata, a Mexican restaurant worker in downtown Manhattan.
An oxygen
The devastation of this sector began to be recorded long before the pandemic, an economic tragedy that was reflected in a chain of suicides of operators of these transport services. In just a few months of 2018 six taxi drivers took their own lives. Two of them Dominicans.
For taxi drivers like the Dominican, Jesús Marquez de 65 years, which sublease a medallion, this agreement managed to give an “oxygen” of survival to an industry that was about to disappear completely, with the additional cost of thousands of ruined families and on the street.
“New York City is not the same. Where are the thousands of tourists who used to arrive at the airport? Where are the executives who came to town? The competition is now stronger with app taxi drivers. Let’s see if we can recover”, considers the islander, with 000 years in the sector.
Other professionals midfielder like the Colombian Camilo Achiverri, 65 years old, are less optimistic: “With this inflation my brother, every day you have to work more hours to do the same thing. There is a reality, people prefer new platforms. Go to the airports,” he indicated.
These individual debt reliefs of thousands of dollars were agreed on last November 3 and the compass of debt renegotiations was opened last 19 of September.
4 keys to the medallion crisis
- Since 2011, revenue from yellow taxis has been reduced by more than one 50%.
- In its heyday in 2014, the medallions of the yellow taxis were sold for a million dollars.
- Since the proliferation of Uber, Lyft and other ride sharing applications As of 2011, the value of the medallion plummeted to $80,000
- The Taxi drivers had to struggle to pay off hundreds of thousands of dollars in debts racked up by medallions that were rendered virtually worthless overnight.
The datum:
- 3,000 Owners of licenses to operate yellow cabs in NYC are qualified under the Help Program to receive significant relief from their debts.