City’s New Five-Borough Cabs Stall in Court [Updated]

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(nycmayorsoffice/Flickr)

Starting this coming week, the Taxi and Limousine Commission was set to distribute the first batch of 18,000 new state-approved livery street hail permits for those new Granny Smith green cabs Mayor Bloomberg created to serve the frequently cab-less outer boroughs, where 80 percent of New Yorkers reside. But the city will have to put those plans on ice. Yesterday, a New York appellate court issued a temporary restraining order stopping the TLC from going ahead with its livery cab plans as a result of three lawsuits filed on Thursday by the Metropolitan Taxicab Board of Trade.

David Yassky, Commissioner of the TLC — whose homepage still features instructions on how to apply for one of the new permits — called the decision "unfortunate" and the mayor's office quickly tweeted: "Disappointing taxi decision that will delay safe & legal service for NYers outside Mnhtn. Exploring our appellate options expeditiously."

In a statement provided to Daily Intel, the city's counsel pointed to the larger ramifications of the decision.

In addition, because we are enjoined from issuing additional medallions, we are prevented from proceeding with a program which will provide significant benefits to the disabled and garner the City approximately $1 billion in critically needed revenues.

He's referring to a part of the law that allowed the city to issue up to 2,000 new yellow taxi medallions, which, while criticized as an unprecedented number, was seen as important for shoring up the city budget.

The ruling, which was made by Supreme Court Justice Arthur Engoron, was more procedural than substantive. His primary objection was the administration's decision to send the plan to the State Legislature rather than to a decidedly less friendly City Council.

This court has trouble seeing how the provision of taxi service in New York City is a matter that can be wrenched from the hands of city government, where it has resided for some 75 years, and handed over to the state.

Both governments are democracies, but only one is solely answerable on election day to the constituents of the five boroughs, those directly affected by the taxi service at issue here.

Engoron also dismissed arguments made by attorneys for the state who pointed out that cabs sometimes serve customers who live outside the city, saying that fact "simply proves too much" with regards to the plan's legal gray area. On the merits of the plan itself, he had little to say. Yet that hasn't diminished this as a victory in the eyes of the yellow taxi industry, which has been protesting the mayor's outer-borough cabs ever since he first proposed them.

The MTBoT, which represents some 35 taxi fleet garages, applauded the court for "[applying] the brakes to one of the most egregious government end-runs and one of the most irresponsibly produced plans in recent memory."

The MTBoT's statement to Daily Intel added that this injunction will stave off "economic disaster for more than 5,000 individual taxi driver-owners and thousands more taxi owners and cabbies who invested their life savings into what they regarded as the American Dream — the taxi medallion." Yellow cab owners currently pay as much as $1 million for the medallion granting them exclusive rights to pick up street hails anywhere in the city. Under the new outer-borough plan, livery cabs would pay just a $1,500 permit fee for much the same rights — just outside core Manhattan, of course.

Saying they had successfully demonstrated "irreparable harm," the judge gives the law's opponents winning odds in this legal battle. But with so much at stake — for, among other things, Bloomberg's legacy — the city is likely to fight this thing to the bitter end. Public Advocate Bill de Blasio, who filed an amicus brief against the state in the cases, called the situation the result of "making an end-run around democracy." As he put it, "The Mayor has time to get this plan right — but he needs to work within the law, and with the City Council, to do it.”

Unsurprisingly, Mayor Bloomberg himself had nothing nice to say about the successful halt of the plan. He referred to the aforementioned de Blasio brief as "stupid," and said the MTBoT's "home-rule" argument was a demonstration of "contempt for the public."