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Controller’s Report Indicates
Drivers Being Overcharged

Cab companies may not charge more than an average of $86.50 a shift, according to a Taxi Industry Report prepared for the Board of Supervisors by the Controller’s Office. Most large companies currently charge an average of $91.50 a shift.
The December report on rates of fare and gate fees recommends meter and gate increases to compensate for general inflation and increased fuel costs. The inflation rate since the last meter increase in Jan. 2003 would justify a 6.6 percent increase in gates and meter rates, but the report contemplates an additional fare surcharge on account of higher fuel prices.
The Controller’s recommendations would result in increases of about 20 cents on the flag drop and 25 cents a mile. The gate would go up about $6 per shift, but taking the current overcharges into account, the increase for most drivers would be less than 75 cents a shift.
The report also calls upon the Taxi Commission to “analyze how best to address the overcharging of the gate fee to drivers which had decreased from $91.50 to $86.50 as of September 1, 2004.” (UTW believes the gate cap actually fell back to $85 under the law.)
The report explains that the reduction in the gate cap came about on account of the Board of Supervisors’ failure to enact a health plan for taxi drivers as required in the ordinance that established the cap. The law mandated the reduction under certain conditions if a plan was not enacted by Jan. 1, 2004. The board extended the higher gate to Sept. 1, 2004, but granted no further extensions.
The report also examines cab company finances. Companies filed financial reports last fall as required by law only after some serious arm-twisting by the Taxi Commission.
Since the financial statements are confidential, the Controller’s Report aggregated the information for all companies. The figures show that from 2001-2004 — a time of terrible hardship for cab drivers — cab companies maintained average net profits in excess of 20 percent most years, averaging 20.8 percent for the entire period.
The report also notes that the health care plan is still pending. “Given the high industry net profit margins and returns on equity, policymakers may wish to consider inflationary increases to fund health insurance costs for drivers,” it states.