It is recommended that the Transportation and Environment Committee accept the administrative response to the recommendations of the Taxicab Task Force and authorize staff to proceed with the implementation of proposals as outlined in the report.

In October, 1999, the Mayor and City Council approved the appointment of a Taxicab Task Force to review and make recommendations on policy and procedural enhancements to the City’s regulatory oversight of the taxicab industry. The report of the Task Force was presented to the City Council for acceptance at the September 19, 2000 City Council meeting. The City Council accepted the report and referred the recommendations to the Administration for review and requested that a written response be submitted to the City Council within ninety days. The attached report complies with that direction and includes a response to each of the sixty-three (63) original issues identified by the Taxicab Task Force.

The Task Force report included sixty-three issues of concern. The issues were grouped into the following ten categories: 1. Regulation 2. Definitions 3. Fares/Income 4. Fees 5. Drug & Alcohol issues 6. Customer Service 7. Disabled and Senior Populations 8. Airport Service 9. Hotels & Attractions; and 10. Convenience/speed of service

Of these, seventeen were submitted without a recommendation from the Task Force and required no subsequent action by the Administration. However, the Administration chose to review all 63 issues of original concern. As noted in Attachment A, the Administration has, in some instances, recommended action where no action was recommended by the Task Force. In general, these recommendations are intended to address safety issues or to provide additional clarity to Ordinance provisions that have presented administrative problems in the past.

The following is a summary of the Administration’s position on the original 63 issues of concern:

Position - Support

Recommendations - Regulation #6, 10, 11, 12, 16, 17, 19, 22; Definition #3, 4, 5,6; Fees #2, 3; Disabled & Senior Populations #5, 6, 7, 8, 9 10; Hotels & Attractions #1, 2, 3, 6;

Position - Support with Modifications

Regulation #7, 8, 9, 13, 14, 21; Definition #1, 2; Fees 1, Drug & Alcohol #1, 2; Customer Service #2, 3; Disabled & Senior Populations #1, 2; Airport 34, Hotel & Attractions #5, Convenience & Speed #1, 2, 3, and 4

Position - Do not Support

Regulation #1, 2, 3, 4, 5, 15, 18, 20; Fare #1, 2; Customer Service #1, Disabled & Senior Population #3, 4, Airport #1, 2; and Hotel & Attractions #7

Attachment A provides an issue-by-issue justification for the Administration’s position on each of the Task Force’s recommendations. However, to expedite the Committee’s review of these issues, the following is a summary of the justification for the Administration’s position of non-support.

These issues all relate to a recommendation that an independent body be appointed to regulate the taxicab industry. While the Administration can appreciate and support the desire to have regular reporting and evaluation of regulatory oversight by an independent body, the Administration believes this can be accomplished by simply amending the Municipal Code to require an annual report be submitted to the City Council.

This report could provide statistical information related to both off-Airport and on-Airport operations including allegation and resolution of infractions, rate setting methodologies, and service delivery issues that have developed during the year.

To identify and resolve these issues, the Administration recommends that a working group comprised of representatives from the taxicab owners, drivers, labor, downtown businesses, the Convention and Visitors Bureau and affected City departments meet four times during the year with their efforts included in the annual report. In this way, the Administration believes that the concerns of the Task Force can be addressed and any augmentation of staff resources can be directed to increased enforcement activities rather than to support the administration of an independent oversight body.

As referenced in Attachment A, the Administration does not support a limitation on the number of cabs (except for those cabs serving the Airport which are limited by the provisions of the Airport concession agreement). Information gathered by the cab owners indicated that the current number of licensed cabs (475) is insufficient to meet the demand for off-Airport service. In addition, the ratio of cabs per population in San Jose is already lower than other comparable jurisdictions. Until such time that sufficient cabs are available to meet demand, the Administration does not support a limitation on the licensing of additional cabs.

The Task Force recommended that meter inspections be valid for a period of one year versus the current practice of ninety days. The Administration recommends that the current length of validity remain in effect as it is consistent with the timeframe for State brake, light and smog inspections

The Task Force recommended that taxi companies licensed by the City be given first priority to purchase retired City vehicles. However, the Municipal Code provides that such vehicles be disposed of at auction to the highest bidder. The Administration does not believe there is sufficient justification or benefit to the City to warrant amendment of this requirement.

The Task Force raised this issue originally, but could not reach consensus on a recommendation. Consequently, no recommendation was put forward. However, the Administration strongly recommends that an age and mileage limit be adopted to ensure that vehicles operate safely and that passengers can be transported in an effective manner. Consequently, it is recommended that vehicles be retired at the end of seven years or 300,000 miles whichever comes first.

The Task Force recommended that meter rates be tied to the cost of living and that they be reviewed annually. Meter rates are currently calculated annually by the City’s Finance Department and adopted by the City Council. These rates are based on a review of rates in comparable jurisdictions. In evaluating this recommendation, staff conducted a review of thirteen outside jurisdictions. None of these jurisdictions reported using “hours worked” as a factor in setting meter rates. To evaluate the appropriateness of San Jose’s meter rate, staff calculated the cost of a five-mile trip based on the formulas used by the other jurisdictions. The results of this analysis is enclosed as Attachment B. As indicated, San Jose’s airport rate remains the highest of the cities surveyed. San Jose’s non-airport rate is competitive for the Bay Area, falling just slightly below the neighboring cities of Mountain View and Sunnyvale. Given this information, the Administration believes that the current methodology for setting meter rates is reasonable and that any additional increase in meter rates might negatively affect the competitiveness of the local taxicab industry.

The Administration does not support establishing minimum fares to compensate taxicab companies for short fares. In the alternative, the Administration would recommend that the Airport staff work with the concessionaires to develop and implement other options such as returning short fare cabs to taxi loading areas or to credit drivers on their fees or lease rates. A minimum fare from the Airport would penalize and discriminate against airport customers and local hotel customers by charging them a higher fee than other taxi customers for like service.

The Task Force recommended that the driver of each cab be allowed the discretion to require animals to be caged during transport or not. The Administration is concerned that this could lead to inconsistent or discriminatory practices; and more importantly, jeopardize safety should the animal become excited or agitated during transport. For these reasons, the Administration recommends that all animals (except service animals) be caged during transport

The Task Force recommended that City fees be waived as an incentive to taxicabs to increase the availability of wheel-chair accessible taxicabs. The fees that are required are used to offset the cost of regulatory oversight. Waiving of these fees would result in an increased burden to the General Fund as there would no longer be revenues to offset these expenses. Consequently, the City does not support the Task Force’s recommendation. The Administration would recommend that alternative incentives be explored.

The Task Force recommended that wheelchair accessible taxicabs be allowed free movement throughout the County as a means of increasing the availability of accessible vehicles. The Administration believes ensuring public safety should be the City’s highest priority and that to allow vehicles that have not been inspected and licensed by San Jose could result in more frequent safety and customer service issues. Consequently, the Administration does not support the Task Force’s recommendation and recommends the current practice of requiring City licensing remain in effect.

The Administration recommends that the City continue to regulate on-Airport taxi service via the use of an Airport concession agreement. These agreements have significant reduced customer service issues and provide a means through which to hold taxi companies accountable for efficient, safe operations and quality customer service. Consequently, the Administration does not support the Task Force’s recommendation that the Airport Concession be opened. However, the Administration is willing to entertain a proposal that would allow a collaboration of companies to apply for one of the concessions that could result in additional companies authorized to serve the Airport. However, such a proposal would need to demonstrate the ability to meet service, quality and efficiency standards in a way that would ensure efficient operations and the prompt resolution of issues.

The Task Force originally identified as an area of concern developing a solution to the discrepancy that can occur when the hotel makes an arrangement with a cab driver for a set amount and the actual cost exceeds the pre-determined fare. The Task Force dropped this issue; however, the Administration would recommend that this issue be referred to the stakeholder advisory group that is to meet with the Police Department to resolve customer service related issues.

Upon acceptance of the Administration’s proposals, the Administration, in conjunction with the City Attorney’s office, will proceed with preparing an amended Ordinance for Council consideration. As part of this revision, the Administration recommends that the Taxicab Ordinance be modernized and updated to incorporate the general regulatory structure embodied in SJMC Chapters 6.01 and 6.02, which applies to the more recently updated police permit and license ordinances, (i.e., the peddling ordinance, the massage ordinance, the ice cream truck ordinance and the public entertainment ordinance).

It is also recommended the actual content structure of the Ordinance be modernized to conform to the content structure of the aforementioned ordinances as well.

Although these changes would (for the most part) be structural and not substantive, there are some substantive provisions that need to either be rewritten or discarded due to their antiquity or lack of clarity. Other provisions, could, in the light of experience, be modified to make the language clearer and more easily enforceable

The recommendations contained in this report included input from the Disability Advisory Commission, the Airport Commission, the City Attorney’s Office and the Departments of Police, Conventions, Arts & Entertainment, Finance and the City Manager’s office.

This memorandum has been coordinated with the City Attorney’s office, the Departments of Police, Conventions, Arts & Entertainment, Finance and the City Manager’s office.