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Mayor Unveils $65 Million Relief Fund for Taxi Medallion Owner-Drivers; Critics Say It Does Little to Help

State Sen. Jessica Ramos joined taxi drivers outside Gracie Mansion Tuesday to protest the mayor’s relief plan (State Sen. Jessica Ramos via Twitter)

March 10, 2021 By Allie Griffin

Mayor Bill de Blasio unveiled a plan Tuesday to provide $65 million in relief funds for taxi drivers plagued by the city’s taxi medallion crisis.

The plan, however, was quickly criticized by cab drivers and progressive lawmakers–such as State Sen. Jessica Ramos–who say it doesn’t begin to address the amount of debt drivers are drowning in.

The city, under the plan, will offer struggling medallion owners zero-interest loans of up to $20,000 to use as a down payment to assist in restructuring medallion debt. The city will also offer the medallion owners as much as $9,000 in no or low interest loans to make up to six monthly loan payments of $1,500.

The proposal, which will be funded with money from the COVID-19 federal stimulus package, was sharply chastised by the New York Taxi Workers Alliance (NYTWA), the union representing about 21,000 drivers.

“The mayor’s plan is a disgraceful betrayal from a city that already has blood on its hands,” NYTWA Executive Director Bhairavi Desai said in a statement.

Desai said the mayor’s plan falls short of addressing the massive debt many medallion owners have racked up from the loans they took out to pay for a medallion years ago. More than 950 taxi medallion owners have filed for bankruptcy, according to the New York Times.

“Mayor de Blasio’s response to our debt crisis does absolutely nothing for drivers,” she said. “It’s a cash bailout for lenders while drivers are left to drown in debt, foreclosure, and bankruptcy.”

The union wants the city to cut every driver’s debt to $125,000. Medallion owner-drivers owed an average of $500,000 in debt prior to the pandemic, according to advocates.

De Blasio said the plan will help yellow cab drivers, who have seen ridership plummet since the pandemic began.

“Medallion owners have been hit hard by this pandemic,” de Blasio said. “They deserve all the support we can give them as ridership recovers.”

However, medallion owners had been struggling before COVID-19 struck.

Many immigrant New Yorkers bought the sought-after medallions with money borrowed from questionable lenders, according to the NYTWA. The medallions, which at one time were seen as good investments, permit a driver to own a yellow cab and be their own boss.

The crisis emerged when unregulated rideshare apps like Uber and Lyft came to New York City and took business away from yellow cabs.

However, the apps exacerbated an already-existing problem caused by a handful of taxi company owners — in concert with unscrupulous lenders and city officials — who artificially drove up the price of the medallions year after year, the NYTWA said.

Southeast Queens council candidate Felicia Singh has been personally affected by the medallion crisis.

Singh and her family are in danger of losing their home in bankruptcy court due to her father’s inability to repay a taxi medallion loan he took out years ago.

Singh, who’s running for the 32nd council district, spoke out against the mayor’s plan at a rally with her family and cab drivers outside Gracie Mansion Tuesday.

“This is what happens when we allow lenders to win,” she said. “If you had a question about whether or not the Mayor serves the people or if he serves banks and corporations, this plan told you the answer today.”

Queens State Sen. Jessica Ramos, who has sponsored a bill to create a taxi medallion debt forgiveness program in line with NYTWA’s proposal, also said the mayor’s plan is clearly lacking.

“This isn’t going to be nearly enough,” she wrote on Twitter. “Average owner-driver debt was at $500,000 prior to the pandemic. We need real debt forgiveness and a robust plan so no more taxi drivers face bankruptcy and lose their homes, their retirement savings, or worse.”

Singh, Ramos and Desai joined taxi drivers outside Gracie Mansion Tuesday to demand more from the mayor.

Desai announced that NYTWA members have decided to protest outside Gracie Mansion every day from 8:30 a.m. to 11 p.m. until the mayor agrees to a better plan.

“If the mayor wants war, he can have war,” Desai said. “There is no peace without justice for drivers.”

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HA. OK.

MFIN, the taxi medallion stock price has liked this news, up 5%, not to mention it’s up over 80% in 2020.

DiBlasio is better off giving that 65 million to unionize Uber drivers in NYC and every other major city.

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