The City of Portland is working on a solution to some appalling labor conditions, but Portland cab drivers learned July 25 that details are two months away. A preliminary City of Portland labor market study released in January estimated that Portland’s 900 taxi drivers commonly work 14 hour days, with no benefits of any kind, for take-home earnings averaging $6.22 an hour. Those conditions are legal because taxi drivers are classed as independent contractors, not employees.
Portland Mayor Sam Adams ordered the study after hearing about taxi driver conditions in a February 2011 meeting with Oregon AFL-CIO president Tom Chamberlain. But City officials haven’t yet determined what they intend to do about those conditions.
The City’s study concedes that City regulations contribute to the problem, since they cap the number of taxi permits at 382, but dole them out to five companies, leaving drivers to compete with each other to use the permits. Radio Cab, a driver-owned co-op, has 136 permits, and offers fairly equitable terms to drivers. But its biggest competitor, Broadway/Sassy’s, charges a $580-a-week “kitty” to drivers of its 153 permitted taxis — ostensibly for insurance, advertising, dispatch and credit card processing. Assuming Broadway pays what Radio pays to provide those services, Broadway’s kitty works out to a direct transfer of $17,000 a year from its drivers to its owners’ pockets.
The other three companies — Portland, Green, and New Rose City — split the remaining 93 permits. Drivers complain that those companies are too small and undercapitalized to generate much telephone dispatch business, so their drivers mostly cruise the downtown hotel and entertainment area or wait up to two hours at the airport for fares — while still paying the companies $425 to $520 a week.
Taxi companies make their money by charging drivers to use the vehicle permits, which they get from the City for $180 a year. Drivers pay the kitty whether they make money or not, and their earnings are what’s left after the kitty, fuel, and car payments are subtracted. It’s effectively a sharecropper system. Most drivers would work at Radio if they could, but it has only so many permits.
But last year, a group of 50 drivers joined Communications Workers of America (CWA) Local 7901 and asked the City for 50 permits to form a second driver-owned company, known as Union Cab.
Their request led the City’s Revenue Bureau — which enforces the taxi regulations — to take a new look at how permits are issued: Is there room in the market for more taxi permits, and how should permits be distributed to best benefit drivers, the public, and the environment? Right now the City has no official criteria to judge proposals like Union Cab’s. But neither does it have a compelling reason to continue the current practice of issuing the same number of permits to the same companies year after year, with few or no performance standards.
Proposed changes to City taxi regulations are first presented to an appointed Private For-Hire Transportation Review Board, which meets every other month. Taxi drivers thought reforms would be aired at the May meeting, but it was postponed and then cancelled. So the mood was impatient at the Board’s July 25 meeting, with scores of drivers filling all seats in a downtown conference room.
“This panel is losing credibility every time we show up and get postponed for another 60 days,” said Broadway driver Brenda Hiatt, to the applause of drivers. “Can you tell me why this is taking so long?”
“We’re not delaying because we want to delay,” replied Kathleen Butler, Regulatory Division manager in the Portland Revenue Bureau. Rather, Butler explained, city officials aim to make a major improvement in Portland’s taxi rules, and they want to get it right the first time.
Butler said staff are researching other cities’ practices, finalizing the January labor market study, summarizing and compiling months of public comment about it, refreshing a 2008 market demand study, and evaluating new models for that study. [The City concluded after the 2008 study that there wasn’t enough market demand to justify issuing additional taxi permits, since that would result in more drivers competing for the same business and lower individual earnings. But conditions could have changed since then.]
Butler told drivers she’ll do everything in her power to have the proposals ready for the Board’s Sept. 19 meeting. It could then be taken up by the mayor and City Council in October. The mayor and City Council plan to act by year’s end, Butler said.
Butler wouldn’t say exactly what the proposal will include, but said it will include performance standards by which companies would be rated for customer service, environmental impact, and services they provide to drivers. Companies that failed to meet standards could lose permits, while companies that met or exceeded them could gain them.
“It doesn’t make sense to issue the same amount of permits every year without taking a look at how the company is performing up to community standards,” Butler told the Labor Press.
