City plan bolsters cabdriver income — without raising fares

Chicago cabdrivers desperately need a fare increase, but they’ll have to wait until after the election to get it, an influential alderman said Tuesday, after Mayor Rahm Emanuel proposed bolstering driver income without raising fares.

Instead of raising Chicago cab fares that rank No. 32 among big cities, Emanuel wants to create a centralized dispatch system using a “universal taxi smartphone application” akin to ride-sharing.

He also wants to cut lease rates, fines and credit card transaction fees that gobble up driver income.

“That still don’t address the issue of giving them the increase that they need,” said Ald. Emma Mitts (37th), chairman of the City Council’s Committee on License and Consumer Protection. “They’ve been crying for years for an increase. I would like to see us get them that increase. … It will come–after the election. We’ll get there.”

Transportation Committee Chairman Anthony Beale (9th) said the mayor’s plan could stop the bleeding caused by ride-sharing — and put big money back into the pockets of struggling cabdrivers — without impacting hard-pressed consumers.

“We will continue to monitor this and, if it’s not enough, we will look to increase fares,” Beale said. He added, “I’m not saying anything about after the election.”

Two months ago, the United Taxidrivers Community Council now trying to unionize cabdrivers proposed a 10-point plan that includes raising mileage and waiting times by 25 percent.

Under that plan, the cost of entering a cab would have remained at $3.25. But the charge-per-mile would have gone up from $1.80 to $2.40, while the waiting time would go to 20 cents for every 24 seconds, instead of every 36 seconds.

Chicago’s $13.80 fare for a 5-mile ride with five minutes of waiting time currently ranks No. 32 among the nation’s largest cities. The proposed change would have pushed Chicago into the top 10.

On Tuesday, Emanuel ignored those demands but embraced many of the group’s other ideas to ease the financial squeeze on cabbies in a heated competition with ride-sharing companies.

They include:

♦ Creating a citywide dispatch system that would require all cabs to carry a new app modeled after the one pioneered by Uber and Lyft. A central dispatch system that includes all 7,000 Chicago cabs — instead of just a few hundred — will make cabs “more competitive” with ride-sharing and improve the quality of service to underserved neighborhoods, said Business Affairs and Consumer Protection Commissioner Maria Guerra Lapacek.

♦ Reducing lease rates that gobble up nearly 40 percent of driver revenue by 10 to 20 percent — or $2,400 to $5,600 a year — and requiring a “lease credit” for all cabs bearing advertising.

♦ Applying straight fares for residents of suburbs bordering Chicago, only when the trip originates at O’Hare and Midway Airports.

♦ Increasing from 40 minutes to one hour the window for cabdrivers waiting at O’Hare to return to the airport and go to the head of the line.

♦ Waiving — on short trips only — the $4 tax that bankrolls McCormick Place and other convention activities.

♦ Capping credit card transaction fees at 3 percent, instead of 5 percent.

♦ Reducing by 60 percent — from $1,000 to $400 — the maximum fine that can be levied against cabdrivers for a host of violations.

UTCC Secretary-Treasurer Peter Ali Enger applauded Emanuel for “finally delivering much-needed reform after ignoring the plight of drivers for so long.”

But Enger also argued that the lease rate reduction after the first model year will provide not a penny of relief for 2,000 drivers who own their own medallions and cabs.

“We are disappointed that the fare increase was not included in the reform package. The mayor’s office is not in favor of it at this moment. But, that doesn’t mean we won’t pursue other avenues,” Enger said.

Ald. Bob Fioretti (2nd), the highest-profile mayoral challenger to declare his candidacy, agreed that cabdrivers deserve a fare hike.

“The playing field [between taxicabs and ride-sharing] was not leveled. We can’t penalize groups, such as cabdrivers, that are highly regulated,” Fioretti said.

Tired of waiting nearly 10 years for a fare increase, Chicago cabdrivers have produced a series of studies to highlight their financial plight and build momentum for their drive to unionize.

One claimed that Emanuel’s 2012 overhaul of the taxicab industry has snatched $7,531 out of the average cabdriver’s pocket, dropping annual income to $20,234 or just $5.40 an hour.

Another claimed that half of Chicago cabdrivers are earning less than the state’s $8.25-an-hour minimum wage — and more than 10 percent are losing money — in a taxi industry that’s generating $30 million in annual city revenue.

The city countered with a study that painted a somewhat rosier picture of driver income.

It claimed the average Chicago cabdriver earns $12.14 an hour and $33,857 a year, even after expenses.

But Lapacek nevertheless acknowledged the need to do something to bolster driver income.

Enger noted that the “next big battle” between the city and cabdrivers could come if and when City Hall gives ride-sharing companies access to the lucrative airport market. Uber-X, Lyft and others are currently prohibited from serving O’Hare and Midway. But, the ride-sharing ordinance approved by the City Council allows the city to authorize such a change.