May 2017

Mississauga taxi interests outraged by Council’s move to ‘level playing field’ by deregulating taxi plates

by Mike Beggs

Mississauga taxi operators are incensed with their Council’s unanimous approval of a Resolution to issue plates to all 250 drivers on the waiting list during the city’s controversial upcoming 18-month pilot project for Uber X vehicles.

Put forward by Councillor Carolyn Parrish, and seconded by Ron Starr on April 12, the Resolution is said to be designed to, “level the playing field” between taxis and Uber.

But industry leaders condemned their politicians for ignoring protocol, by bypassing the Public Vehicle Advisory Committee and going straight to Council for a vote on this item. The decision, they claim, amounts to industry deregulation – a documented catastrophe in virtually every city where it has been tried, resulting in deteriorating service, vehicle, and safety standards, as drivers struggle to survive any way they can.

“It’s basically deregulating the industry. Anywhere it has been tried, it has been a nightmare,” says All-Star Taxi manager Mark Sexsmith.

“They don’t really care about the industry. I can’t believe something this fundamentally irresponsible could happen. There are no surprises in Toronto, but (heretofore, our regulators in Mississauga) have always had a modicum of sense.”

Long-time plate owner Peter Pellier deemed the resolution a “disaster” that must be, “vigorously opposed”.

“This is complete deregulation, no matter how you slice it,” he agrees.

“In my nearly 50 year association with the Mississauga taxi industry, never has such a reckless decision been rendered. (The recommendation for 250 additional plate issuances) demonstrates complete disregard for the City’s cabbies, as well as a total lack of understanding regarding the nature of our business.”

He warned members of Council that flooding the market with cabs, “will significantly reduce the quality of service, seeing as vehicle maintenance and driver attitude will surely suffer.”

One Toronto industry source likened the most recent developments in Mississauga – and several other Canadian cities -- to the Zombie apocalypse, “this mindless rush to lay down, and give Uber everything.”

This new motion came just two weeks after Council passed a (March 29) resolution finalizing the terms of the contentious Uber pilot project, being pushed for by Mayor Bonnie Crombie – much to the dismay, and anger of licensed taxi operators. Following the template laid down in Toronto, and Oakville, at Uber’s request, in-car security cameras have been made optional, the Demerit Point level has been moved from 6 to 8, and the requirement for medical insurance has been removed, and Uber can put on an unlimited number of cars during the trial.

But that was BEFORE this new Resolution (replacing the March 29 Resolution), permitting another 250 taxis in an already overcrowded market, if it goes ahead.

This new Resolution reads that, “The regulation of the taxi industry creates an unfair competitive position for cab drivers, in light of the legitimization of Transportation Network Companies (TNC’s) through the Pilot Project being initiated on July 1”, and that, “taxi plates have been greatly devalued by the advent of TNCs operating illegally in the City of Mississauga over the past several years.”

“To make the level playing field the Mayor wants, we need to have 250 plates for the taxi drivers,” Parrish explained.

The new Resolution resolves that:

• A complete review of bylaws governing the taxi industry be immediately conducted, with an eye to eliminating or modifying all and every bylaw or regulation, to parallel those in the regulations for the Pilot Project governing TNCs starting July 1, 2017;

• The results of that review be presented in a report to PVAC on September 19, 2017 and from there to Council in sufficient time;

• That the 250 qualified taxi drivers on the waiting list be provided, for a nominal administration fee, plates effective for the period of the Pilot Project.

At the PVAC meeting on April 24, industry deputants urged councillors to rescind this new Resolution, and revert to the one passed on March 29. They fear, with their business already ravaged by the cut rate Uber X service, this could be the final nail in the coffin.

According to Sexsmith, just two years ago the capital value of Mississauga taxi plates was $167 million. But, with the passing of this resolution and the adoption of the TNC pilot project, he predicts the net value of the fleet will be close, or equal to zero, plate rental incomes will drop to fee recovery levels, and the income of all active operators – already down by at least 33 percent -- will head even further south.

“This deregulation affects all members of the industry – drivers, taxi owners, and taxi plate owners. No one in the industry will come out ahead,” he stated.

“Those 250 drivers on the priority list will be receiving a valueless commodity. And, the public will bear the brunt of our industry trying to cut corners.”

Further, he suggested that with the heightened competition, and the $60,000 upfront cost of the modified vans, Mississauga will see wheelchair accessible taxi service disappear completely.

However, Parrish told the crowd of angry cabbies, in light of the heavy intrusion of Uber over the past few years, the issuance of these 250 plates, “won’t make a hill of difference.”

And she reminded them that these plates would only be “temporary”, for the life of the pilot project.

“What caused the destruction of the $167 million in plate values is Uber,” she said. “Uber is an illegal service. We fought it as hard as we could—and we should have (fought harder). For that, I apologize. (But), the 250 plates is not causing the loss.”

However, Sexsmith suggested the politicians don’t understand the market is now “segmented” between taxis, limos, and Uber, and, “the 250 plates won’t give the taxi industry a chance to make a living.”

“What you’re doing with these 250 taxi plates is not competing with Uber, they’re competing with other taxis. You have 525 drivers in the city proper. You have cut every single driver’s income by one-third,” he said.

Other deputants were, similarly baffled and disappointed by this latest turn of events at Council.

“I’m shocked,” said Aeroport Taxi owner Sami Khairallah. “Any business person can tell you, when the demand is dropping you don’t increase the supply.”

“Right now, what they’re doing is taking the ‘taxi driver’s pension’ away (from long-time owner/operators). They’re saying, ‘You don’t count anymore.’”

A 40-year veteran, owner/operator Rick Salamah pleaded with the Councillors not to follow through with their plans.

“For God’s sake, please let us catch our breath, because we are challenged,” he deputated. “I am driving an accessible cab.”

“There is no need for 250 plates. Let us regain some business, based on the present (plate issuance) formula.”

Deputant Alexander Mantadis argued that Mississauga’s longstanding weighted plate issuance formula – reviewed every two years -- ensured stability for all industry stakeholders. He cited his father’s longstanding contribution to the industry as a driver/owner, and stressed that his mother lives on the monthly rental income from his plates.

“The taxi business, in the last two years, has been under a brutal attack on the people who invested their own money. The TNC’s took that investment and made it worthless,” he alleged. “Uber painted them as members of a cartel.

“(That 250 plates) is the equivalent of adding another brokerage to the city.”

However, Parrish expressed little sympathy for multi-plate owners.

“My heart breaks for the guys who have spent 25 years on the waiting list (for a plate),” she said.

Of this comment, Pellier told Taxi News, “They don’t even care about the owners. (This motion is) driver-driven.”

Further to the point, Parrish suggested that, “This industry has been overregulated for 25 years. I don’t know who is responsible for that – perhaps the previous Mayor (Hazel McCallion).”

Pointing to the PVAC’s longstanding reputation for being one of the country’s most progressive taxi regulatory bodies, Pellier responded, “That’s b.s. We’ve been REGULATED. And it has worked.

“Clearly times have changed, and the goodwill between the City and cabbies no longer exists among most members of Council -- and what I’ve just heard from Councillor Parrish underscores it,” he deputated.

In the end, the industry arguments at PVAC were powerful enough for Starr (the committee Chair) to recommend another meeting to discuss this item, prior to the June 30 PVAC meeting. In the interim, staff has been instructed to contact all drivers on the waiting list to determine their level of interest in accepting a plate for the 18-month trial period. (Mississauga licensing manager Daryl Bell reported there are presently 197 drivers on the waiting list.).

“I think it’s important enough to come back to the next PVAC. I don’t want to circumvent the system,” Starr said.

“We want the input, we want to do it right.”

PVAC citizen member Al Cormier’s motion to accept all items within the new resolution, excepting Item 3 pertaining to the 250 plate issuances, was approved.

Crombie claims the pilot project represents a chance to level the playing field, by updating Vehicle For Hire rules and regulations, “to ensure Mississauga is a city in step with the times, and with what the public wants”. She notes that 60,000 Mississauga residents use Uber every week; and the City expects to generate $850,000 in annual revenues from Uber paying a 30 cent fee on every run, during the trial.

However, long-time owner/operators feel betrayed by their Council, after paying heavily for plates, insurance, licensing fees, training, and vehicle inspections over the course of many years.

Pellier observes that, “all of these municipalities are following suit”, in bringing Uber into their respective bylaws and acceding to its demands.

“But Toronto and Oakville have not done what Mississauga is proposing (another 250 unneeded plates),” he says.

“(And), we have an uphill battle. Councillor Parrish is determined to get these plates issued. She only reluctantly agreed to a special meeting, because we were totally opposed (to the Resolution).”

He dismissed the notion of these 250 plates being temporary.

“There’s no such thing as temporary plates, because once it’s issued, it’s issued,” he continues. “You can’t go to a guy who invested $40,000 and 18 months, and say, ‘We’re taking your plate back.’”

Noting that the pilot project kicks off on July 1, he warned his fellow industry members, “Time is short if we’re going to change their minds.”

Pellier said he would be contacting the Ministry of Municipal Affairs, asking them to intervene on this issue.

“This is a matter of fundamental justice”, he stated.

“(Putting out) 250 plates in Mississauga is a huge disaster, and it really does represent a violation of the Canadian Charter of Rights, Section 7 -- with the psychological pressure they’re putting on the drivers.”

After the meeting, PVAC industry rep Karam Punian suggested applying for a court injunction to block this new Resolution.

With the direction things are going of late, Sexsmith expressed fears that the PVAC would become little more than a figurehead committee, or “window dressing”, with no real input into the making of policy.

“But as long as we’re talking, there’s still hope,” he said, of the Resolution’s status.


© 2017 Taxi News


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