March 2019

PVAC agrees to ‘look into’ compensation for Mississauga taxi owners

by Mike Beggs

Mississauga will look into the idea of compensating taxi plate owners for their huge losses due to the arrival of Uber and other ridesharing companies.

At the February 11 meeting, the City’s Public Vehicle Advisory Committee (PVAC) adopted a motion directing staff to explore what other jurisdictions across North America have done to offset the devastation to cab operators.

This came at the request of Aaroport Taxi owner Sami Khairallah, who called for compensation of $50,000 to anyone who owned a plate at the start of the ongoing Transportation Network Company (TNC) Pilot Project.

“The taxi industry has hit rock bottom,” he said in a deputation.

“The supply management the City had previously had in place for decades was destroyed as soon as the decision was made to allow an unlimited number of TNC vehicles to hit Mississauga roadways, with very minimal amount of regulations or barriers to entry. This resulted in the total destruction of the taxi industry, and has clearly affected the ridership on Public Transit.”

Khairallah argued there is “no difference” between taxi plate owners who have lost 70 percent of their market share, and those milk producers whom the federal government is now compensating for giving up 3.6 percent of their market share.

He notes that the City mandated “endless regulations”, set prices, limited the supply of taxis, and allowed the licenses to be transferrable, thereby creating market value. And he claims the licenses were referred to as a pension, or retirement fund for longstanding drivers by city councillors.

“The hardworking cab owners deserve to be compensated, because the City is responsible for creating the situation they find themselves in,” he stated.

Khairallah noted the Province of Quebec is already committed to compensating up to $46,000 per owner, while class action suits have been initiated by plate-holders in Ottawa and Toronto. He said compensation represents a compromise that would avoid spending tens of thousands of dollars on lawyers.

“I’m proposing $50,000, which is way lower than what the market value was,” he continued.

“A lot of our owners have put their entire life (into the taxi business).The City decided to change this. We’re not asking for $150,000, we’re asking for $50,000.”

He suggested the funds for compensation could be collected through either a per trip fee, or a lump sum directly from the TNC companies that wish to operate in the City of Mississauga. Under the Pilot, TNC’s are paying the City 30 cents per run.

“Under the cost recovery for regulating this industry, we’re still paying what we were paying before -- so the money coming in from the TNC’s should be used to compensate the taxi industry,” he reasoned. “It’s only fair to share that revenue, and compensate these people.”

A plate-holder since 1978, Peter Pellier agrees compensation would provide “both closure and justice” to what has been a horrific turn of events for Mississauga cab owners, who he feels, “deserve much better, given their years of service.”

“Every single individual affected, and their respective families, has faced what no hard-working person should have to, namely, the loss of their economic security,” he states. “Regardless of arguments to the contrary, the fact remains, those plates represent jobs, and for the owners, their pension. No amount of posturing, no degree of denial can alter this reality.”

His plate on the shelf, another retired owner/operator says he’s now paying $713.55 a year in renewal fees, “for nothing”. He stresses the City put out another 38 taxi plates, in addition to allowing an unlimited number of TNC cars, so, “there’s actually no business for my plate.”

In response to Khairallah’s request, PVAC Chair Ron Starr suggested staff should examine this issue, and consult with the City’s legal department.

“I think your point is a great one. Compensation is a matter that has been on the minds of all the industry,” he said. “I think it’s time to take a look at it, and not just say it’s pie in the sky.”

Ward 11 Councillor George Carlson said he’s open to hearing any proposals, “if there’s any chance to help the plate owners out.

“I have great empathy for them, because it really amounts to what was their retirement fund for most drivers. But the tricky part is, how do you compensate them without upending the whole private sector applecart?”

Mississauga Legal is on record that the City has no obligation to compensate taxi plate owners.

In his deputation, All-Star Taxi manager Mark Sexsmith outlined a list of 11 “leveling the playing field items”.

“We keep asking for the level playing field. There are so many things to level that the City can’t accomplish. I think the City needs to reach out to the Province,” he stated.

With the “crazy” number of vehicles on the road, he claims, “Nobody’s happy, nobody is making any money. There has got to be some kind of resolution on this.”

He said the City should determine how many taxis and TNC’s are needed and try to get to that level, noting, “they’re having a problem with congestion in Toronto (under unlimited entry).”

Manager of vehicle licensing Mike Foley explained that, at this point in the pilot project, the City would not release the total number of TNC’s in Mississauga. But he said, “it’s significantly more than we expected.”

Sexsmith also recommended a change in the representation on the PVAC, because, “There’s nobody here from the TNC’s, and they’re going to be part of our situation.”

And, he cited two different standards at Pearson International Airport, with PTC’s paying only half of the $9 pickup fee for taxis. And he wondered, with the airport located in Mississauga, if the City is collecting the 30 cents per run from PTC’s?

Foley responded, “It’s not really a City issue. The negotiations were between the Greater Toronto Airports Authority and Uber and Lyft, and private to them.”

Sexsmith said the standard of for hire drivers is another big issue that needs addressing.

“The driver training should be dealt with efficiently and quickly, because there are a lot of public concerns about safety,” he said, noting that Toronto Council recently directed staff to look into mandatory training for all taxi and TNC drivers.

Foley noted, “That was only a resolution, it hasn’t been adopted.”

“With regards to training, we can provide it. But at this point in time, there have been very few issues with TNC drivers and training, so it’s unclear,” he added.

Starr noted many of these points would be addressed in the final TNC Pilot Project report.

“We realize the industry has been paying for training for many years, and there is a discrepancy. There are a lot of grey areas here that are difficult to put together,” he observed. “You keep bringing up a lot of good points. There seems to be an unfairness.”

“There’s a desire from the people to have TNC’s. At the same time, do we flood the market? They’re all valid points of discussion.”

With plate values now down to only $5,000 to $10,000, and leasing rates a bare fraction of what they were, deputant Alex Mantadis requested that annual renewal fees be reduced from $500 to $100 a year.

He noted his 82-year-old mother lives in a nursing home and is dependent on income from her taxi plate (now on the shelf), and that he and his late father both worked in the cab industry, and, “saved our money, and tried to get ahead working under the existing system.”

“You’re asking us to pay about $500 a year to keep a plate. Now we have two plates (on the shelf) and getting zero income. It’s not our fault. The circumstances have changed.”

Pellier supports this idea, noting that with the traditional balance between the number of for hire vehicles and the opportunity to earn a reasonable living disrupted by PTC’s, many owners have been forced to put their plates on the shelf.

“Given the absence of any income whatsoever from these plates, not to mention the virtual absence of costs associated with regulation and administration, to expect plate holders to pay the full renewal fee is unreasonable and unfair, and effectively imposes added financial hardship,” he says.

Foley confirmed there are presently about 70 plates on the shelf.

“They tend to rotate in and out,” he said. “There’s still a market to lease, or sell taxi plates.”

He elaborated that any changes to renewal fees would have to go through the Budget Committee, and then on to General Committee, and Council.

Starr responded, “We can make changes as a Council -- it’s unusual. So find out what we can come up with.”

Another plate owner asked the City to grant a short-term extension to those 2011 cars slated to come off the road at the end of March (including the last of the classic Ford Crown Victorias). He argued that owners have very little income to invest in a new vehicle, and it would be advantageous to see the results of the TNC Pilot Project first.

The next PVAC meeting is scheduled for April 9.


© 2019 Taxi News



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