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Richard N. Velotta

Proposal will pit Las Vegas cabbies against ride-booking apps

24 July 2015

Cab company owners attending Thursday's Nevada Taxicab Authority session called it the most important meeting in the board's history.

It's not hyperbole.

Some owners say the very survival of the industry is at stake when transportation network companies like Uber and Lyft begin operating in Southern Nevada later this summer.

An industry proposal that deregulates several aspects of cab licensing won approval, setting the stage for a more competitive environment between cabbies and contracted Uber and Lyft drivers.

Owners applauded after the board's 4-0 vote that will eliminate time and geographic restrictions on cab medallions and convert them to around-the-clock use in any location in the county. The board also approved the addition of 20 new medallions per company, 10 immediately and 10 more effective Nov. 1. That's 320 more cabs between the 16 companies.

The move effectively allows cab companies to convert 791 time-restricted medallions and 433 geographically restricted medallions to unlimited use.

The end result is that there will be nearly twice as many unrestricted cabs — 2,730 compared with 1,443 — on the road once every restriction is lifted.

There are 121 geographically restricted medallions that are specifically tied to some companies; operating certificates, but those restrictions will be lifted on Jan. 1 as a result of a new law approved in the recent legislative session.

But most of the other restrictions will be lifted as soon as the order is signed, probably by Monday.

The industry isn't likely to use the 2,730 medallions right away since their cab fleets don't have enough cabs to use all of them.

What the action means is that the cab companies will be able to counter some of the anticipated flood of Uber and Lyft drivers that will take to the road as soon the Nevada Transportation Authority approves regulations for their companies.

Company owners also said in testimony before the board that the lifted restrictions would give them more flexibility in scheduling driver shifts. There could be fewer cabs on the road midweek when there are no conventions in town, but considerably more during big trade shows and on weekends, especially during special events.

"We need to have the ability to put out our cabs when we need them out there," said Lucky Cab owner Jason Awad, who made the proposal for the Taxicab Authority's consideration. "We should be able to accommodate the schedules of our drivers better."

Awad said he envisioned the likelihood of offering more shifts during busy periods when drivers can stay busy and make the most money. Schedule flexibility is one of the benefits transportation network companies pitch when recruiting their drivers.

The cab companies didn't get everything they wanted. Awad's proposal to the board sought 40 additional medallions per company instead of 20. The authority board didn’t close the door to adding 20 more, wanting to see how the initial changes played out.

Not everybody was happy with the proposal.

Representatives of the United Steelworkers and the Industrial, Technical and Professional Employees unions opposed the proposal, saying the high volume of cab and transportation network company drivers flooding the streets would make it impossible for union drivers to make a good wage.

But the board discounted the argument, saying company management knows best how to develop schedules to keep drivers busy and happy. They said the added flexibility should enable companies to provide better opportunities to drivers.

Board members also had some concern about the majority of cab drivers and Uber and Lyft focusing too much on the resort corridor and not enough on outlying neighborhoods.

"We're going to continue to service the people who have been our longtime customers," said Jay Nady, who owns A-Cab, which has operated primarily in neighborhoods west of Interstate 15.

Separately, the authority board put off a decision on rates, awaiting a clarification from the Nevada Department of Taxation on whether the 3 percent tax on taxi and transportation network company rides that takes effect Aug. 28 is an excise tax or a tax on a company’s gross revenue. If it's deemed an excise tax, it could be programmed into taxi meters; if it’s a tax on revenue, company owners said they'd likely recommend a rate increase to pass the tax through to customers.

Las Vegas already has the fifth highest taxi rates in the country.