A story in this morning’s edition of the New York Times tells of a judge in New York that has ruled in favor of a preliminary injunction keeping the city from instituting the new 25 MPG minimums for new taxicabs that should have gone into effect this weekend. While the Times may report that this preliminary injunction “kills” the new standards, all that it proves is that the plaintiffs have demonstrated a solid case and have a “high likelihood of success” in open court, not that the injunction is permanent or that TLC was wrong for making the new rules.
After reading the opinion, it seems like the plaintiffs (”taxi companies”) are resting their case on the foundation laid by a 1983 case where a federal statute conflicted with another, more recent statute. The argument the taxi companies are making is that the US Government provides fuel efficiency standards for automobiles, and that the TLC’s raising of those standards would lead to “irreparable financial damages”.
The arguments made by the defense, in my opinion, did not go far enough to establish the precedent of the TLC dictating which vehicles are appropriate for use as a taxicab. In the same way as a minivan is an inappropriate vehicle for transporting large amounts of gasoline, the Crown Victoria is becoming an unsuitable vehicle for use as a taxicab. Throwing aside the TLC’s motivation for raising the standards, their ability to do so and justification for jurisdiction in the matter should be self-evident by the certification system and licensing that TLC does and all companies agree to, and their use of the same powers to regulate which vehicles are appropriate for use as taxis (there’s a reason you’ll almost never see a stretch limo with a NYC TLC plate on it).
To the court’s credit, the plaintiff’s complaints about the “safety concerns” regarding the new hybrid models will not come under scrutiny. At one of the City Council hearings over the summer, the same topic was brought up, with pictures of mangled Priuses paraded around to support their claim. But, as someone said then, the circumstances surrounding those tests were not disclosed, and obviously the “worst case scenario” was used to produce the results. And such arguments would only serve to distract the court from the meat of the plaintiff’s arguments.
The real impetus for this litigation, as always, stems from a monetary issue. A quick glance at the plaintiffs reveals that they are mostly fleet owners and owner’s organizations, with an independent driver thrown in. As those who have seen my HOPE presentation know, the taxicabs are usually only owned by the fleet owners and independent owners, and the drivers work as independent contractors under them (not for them), renting the cabs for a period of time. Since the new hybrid cabs cost a substantial amount more to purchase, especially with the T-PEP system, the cab companies are guaranteed to lose some money on the deal if the lease rates for the cabs (the “rent”) doesn’t increase proportionally. The fuel savings, the main advantage to the industry provided by such a change, only effects the drivers who actually pay for the fuel. In addition, where the parts for a Crown Victoria are easily replaced after an accident or wear and tear takes their toll, the repair costs for hybrid models are still very high due to the lack of parts available at any given time. Also, where a Crown vic can usually withstand being hit by a garbage truck, the hybrids will usually be totaled after such an accident. With the country slowly slipping further into this financial crisis, it’s easy to see why the cab companies are reluctant to be dragged into this new standard and be subjected to the higher cost of doing business with (to them) riskier equipment.
But understanding the problem and agreeing with the cab companies’ stance are two different things. For the thousands of taxi drivers, the new hybrids would increase their weekly cash flow, the city streets of New York would be a little more eco-friendly, and the supply problems would disappear once the demand for the parts increased to the critical mass necessary for the manufacturers to identify the potential in the taxi market. All the problems the cab companies foresee will eventually be fixed, either by the free market or by an increase in the lease rate for cabs. And as much as the cab comapnies don’t want to leave their gas-guzzling 11 MPG Crown Vics, the world is changing and gas is becoming more and more expensive each year. If the fleet doesn’t start changing now, the environment and the taxi industry will definitely be worse for the wear.
Full court opinion can be downloaded from the NY Times here.
