This article was originally published on February 1, 2010
On the June day in 2003 that Mayor Daley personally welcomed Symon Garber and his new fleet of maroon-colored cabs to Chicago, he made a prediction:
Cab service here would dramatically improve. Garber’s stretch taxis would have extra legroom and be equipped with computer touchscreens, so passengers could send off e-mails while being chauffeured around by drivers who’d wear uniforms and say “please” and “thank you.” And they’d spur competitors to raise their standards, too, improving service for all.
“This is something we all have prayed for for many, many years,” the mayor said.
Today, more than six years later, Garber — a Russia-born businessman from New York — has built what he boasts is Chicago’s biggest taxicab empire.
Garber is a friend of Patrick Daley, the mayor’s son. City Hall says he has received no special treatment because of that friendship.
Garber has yet to come through with the uniforms or the computer access for passengers. But the impact that Garber and his associates — operating primarily under the names Chicago Carriage Cab Co. and Royal 3 CCC Chicago Taxi Association — have had on the taxicab industry here has been immense.
Since City Hall gave Garber a license to operate cabs:
– His presence has helped drive up the price of a taxicab license — known as a medallion — by nearly 400 percent, at the same time adding immensely to his and his partners’ own fortunes. The price for one of the 6,700 taxicab medallions issued by City Hall has soared to $190,000. Garber operates 831 medallions, including 797 that he, his business partners and associates have bought for a total of more than $52 million since 2002, according to city records. The value of those medallions today: $150 million.
– The soaring prices have led to a drastic decline in the number of independent cab operators. The number of cabdrivers who own their own medallions has dropped by 25 percent, despite the city’s longstanding goal of increasing the number of owner-operated cabs. The city now has 2,060 cabbies who own their own medallions, down from 2,636 five years ago. One reason: Cabbies have taken advantage of the rising prices to sell their medallions to Garber and others for huge profits.
– A cabbie now pays about $575 a week — or about $92 a day — to lease one of Garber’s cabs. Though Garber wouldn’t discuss his finances, he and his associates would gross more than $24 million a year if they leased all 831 of their cabs on a weekly basis.
– Since the mayor lifted the city’s long-standing ban on taxicab advertising in 2006, Garber and his associates have taken in $2.1 million from advertising — a third of all the money spent on taxicab advertising in Chicago.
– Garber has found a way to make money even in helping his competitors. He and his partners started a business called Triglobal Financial Services Inc. that says it has $500 million to finance medallion purchases in Chicago and across the country. The city says Triglobal has lent money to finance the purchase of 617 medallions in Chicago — including 156 operated by Garber competitors such as Flash Cab and Yellow Cab.
CITY’S ‘LARGEST TAXICAB COMPANY’
For decades, Yellow Cab was Chicago’s dominant taxicab company. It still operates 1,548 cabs — nearly twice as many as Garber. But Yellow Cab owner Michael Levine agrees that Garber is now Chicago’s taxicab kingpin because Garber owns all of his vehicles, while Yellow and other companies don’t own all of theirs.
“We are considered the largest taxicab company in Chicago,” Garber boasts.
But he declines in a brief interview to talk about his growing domination of Chicago’s cab market and how he and his partners have financed their rapid growth.
“It’s a private business,” Garber says.
After first saying he wants to talk more, he refers questions to his publicist, June Rosner, whose sister, Lois Weisberg, runs Daley’s Department of Cultural Affairs. Rosner didn’t provide answers to e-mailed questions.
All taxicab medallion owners in Chicago must file yearly reports with City Hall disclosing their gross revenue and expenses. They have to provide figures including how much they borrowed to buy the medallions and how much they charge cabdrivers to lease them.
But a Chicago Sun-Times request to review city files for all medallions operated by Garber was rejected. The Illinois Freedom of Information Act generally requires that government records be made available for public scrutiny. But some exceptions are allowed, and the Daley administration claimed one, maintaining that it would be too burdensome for city officials to go through all of those records and remove or black out proprietary financial information.
FROM MOSCOW TO N.Y. TO CHICAGO
Still, it’s clear from what records are available that Garber, 44, is a wealthy man today. He plays polo and lives with his family on a 10-acre estate in New Jersey just outside of New York City.
But Garber, a Russian emigre, came from very humble beginnings, according to past interviews. He was 12 when his parents — a nurse and a sheet-metal worker — moved with him to the United States. Their first home in this country: a Jersey City, N.J., housing project.
Garber has said he drove a cab for a couple of months while in college.
He was 20 when he started buying taxicab medallions in New York City. He has said he operates 400 of the 13,237 medallions in New York City.
Fifteen years ago, after being introduced to high-ranking Russian government officials, Garber started a taxi business in Moscow, the Chicago Tribune reported in 2004. He has said he operates 900 cabs in Moscow.
“It’s all about who you know,” Garber told the Tribune. “It’s important to be well-connected. Life is a two-way street.”
Garber has said he met Patrick Daley in Moscow.
“Me and Patrick are very good acquaintances,” Garber told the Sun-Times in a 2008 interview. “We met in Russia somewhere in August 2001. One of my friends, he introduced me to Patrick. We were there twice at the same time. And one time we went out in New York” — where Patrick Daley worked for Bear Stearns, the now-defunct investment and financial services company.
By fall 2002, Garber had started buying taxicab medallions in Chicago, many of which had been surrendered by Yellow Cab as part of its effort to focus more on managing cabs and less on ownership of cabs. Garber had control of 300 medallions in June 2003 when he got a license from the Daley administration to begin operating Chicago Carriage Cab.
In Chicago, as in New York, City Hall has complete control over cab companies. City officials determine the number of cabs, who can operate them, who can own them, who can drive them and how much riders pay to ride in them.
Though Garber expanded to Chicago within a year of meeting Patrick Daley, the mayor’s son had no role in Garber’s getting a license from the Daley administration, Garber has said. And the mayor’s press secretary, Jacquelyn Heard, echoes that.
COMPANY KEEPS GROWING
“Patrick didn’t help me with anything,” Garber told the Sun-Times in 2008. “We did not go out in Chicago socially. I knew he was the mayor’s son, and I didn’t want to have any implications that anyone is helping me run my company.
“The only business deals were with a bottle of vodka,” he said then. “Patrick is an excellent guy. Great drinker, knows how to hold his liquor. We played some rugby. He has a great sense of humor.”
Heard says the mayor and his son have never spoken about Garber.
Heard explains Garber’s success in Chicago this way: “Here’s a young man who started a business in New York and did well and then came to the second-biggest market, Chicago, and started a business here.”
Patrick Daley, who has recently been living in Moscow, didn’t respond to an e-mail asking about Garber.
Patrick Daley, who has been a venture capitalist for several years, has been under investigation by the city’s inspector general and federal authorities over the hidden ownership stake he bought in 2003 in a sewer-inspection company that won millions of dollars in no-bid contract extensions from City Hall.
A year after Garber got into the cab business in Chicago, he hired the mayor’s former chief of staff, Gery Chico, to lobby Norma Reyes, the mayor’s commissioner of business affairs and consumer protection.
Chico didn’t return phone calls seeking comment.
Reyes says she believes Chico was trying to get the city to raise the lease rates Garber charges drivers — and wasn’t successful.
Garber’s cab company keeps growing. During the first nine months of 2009, even as Chicago and the rest of the nation remained mired in recession, city records show Garber and his associates kept buying taxi licenses. They bought 68 medallions, paying more than $9.1 million.