(Bloomberg) -- New York City Council members are considering laws that would bail out hundreds of taxi drivers facing financial ruin as competition from Uber-like vehicles choke city streets and erode their income.
Dozens of Yellow Cab owner-operators marched on City Hall Monday, when some offered tearful testimony describing how their belief in the American Dream was shattered by predatory lenders and city policies encouraging an inflated market for licensing medallions that burst with the unregulated growth of the electronic-hail industry.
"I think about taking my life -- I really do -- and the only thing that stops me is my kids," Mouhamadou Aliyu, a West African father of four who's been in New York since 1993, said in testimony to the council. He bought a medallion for $700,000 in 2004 that's now worth $100,000, he said.
Aliyu said he's still $54,000 in debt, and his shrinking income isn't enough to repay his medallion loan, the lease on his cab and the mortgage on his Bronx house. "If I lose my house I'm killing myself, period. Because my house is for my kids, my future, please help me."
At least nine drivers have killed themselves since late 2017, including one who took a shotgun to his head near City Hall last year, according to Bhairavi Desai, a political organizer who leads the Taxi Worker Alliance. She told council members to cap medallion loan payments at $900 a month, down from the current average of $2,800. She called for a city task force to determine how much a taxi medallion license is worth and to press lenders to forgive any loans above that amount. The average medallion-owning cabbie loses an average of about $28,000 a year, she said.
Council Transportation Committee Chairman Ydanis Rodriguez offered sympathy but didn't endorse their demands. He invited the drivers to testify, he said, to focus attention on the medallions' value and the "blind eye" taken by city regulators that may have allowed cabbies to fall prey to predatory lending and other corrupt practices.
"These are small business owners, many of them immigrants who invested hundreds of thousands of dollars into a medallion in hopes of achieving their piece of the American Dream," Rodriguez said. "We must also find a way to hold the people responsible for this financial crisis accountable. This crisis was no accident, and we must make sure the taxi medallion owners receive justice."
Rodriguez and Councilman Ritchie Torres, who heads its Oversight Committee, took aim at Bill Heinzen, acting chairman of the city's Taxi and Limousine Commission, for what they termed the regulatory agency's failure to protect drivers.
Although Heinzen touted the agency for capping the number of app-based for-hire vehicles at 80,000 last year, Torres focused on the agency's promotion of medallion auctions in 2014. At that time, the advent of Uber hadn't yet brought on the collapse of the market and the city advertised the $650,000 licenses to potential owners as an investment that was "better than the stock market," guaranteeing a "worry-free retirement."
Torres produced a city memorandum from 2011 warning TLC officials that medallion prices were at risk of collapse. City officials either ignored the advice or weren't aware of it at the time, Heinzen said.
Also under questioning by Torres, Heinzen said the city had no record of how many drivers had filed for bankruptcy or were at risk of financial collapse.
"I don't know the exact number," Heinzen said. "I'm sure it's painfully high."
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