County Board to Consider Taxi Fare Hike

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by ARLnow.com November 14, 2011 at 2:35 pm 3,261 47 Comments

(Updated at 3:10 p.m.) The Arlington County Board is scheduled to consider a fare hike for Arlington taxi operators this weekend.

The proposal would raise the initial drop charge from $2.75 to $3.00 and would raise the charge for additional passengers from $1.00 to $1.50. Arlington County staff is recommending the Board approve the increase in order to offset an estimated 5 percent rise in expenses for taxi drivers since the last fare hike in 2008. (The per-mile rate was increased from $1.80 to $2.00 in July 2008)

Although taxi drivers in Arlington drive branded taxi cabs — Red Top, Blue Top, Envirocab, etc. — they are actually independent business owners who merely pay the cab companies fees for use of the name and other services. Therefore it’s the drivers, not the companies, that are affected when gas prices or insurance rates increase. Arlington County estimates that cab drivers here currently make between $40,000 and $60,000 per year, after expenses.

To provide a benefit to local taxi riders who will be affected by the fare hike, the Board will consider a new rule requiring credit card machines in all Arlington-based taxicabs. Also, to lessen the impact of the fare hike on families, county staff is recommending the Board exempt riders younger than 12 from the additional passenger charge. Currently, the charge is only waived for children younger than 6 years old.

The fare hike will not only affect riders, but will affect the county’s bottom line as well. Staff estimates that the rate increase will cost Arlington’s STAR para-transit program — which uses taxis to transport disabled citizens — more than $12,000 per year.

If approved, the rate hike would go into effect on Jan. 1, 2012. The credit card requirement would take effect on Dec. 1, 2012.

Chris M.

Why exactly do we need the county to set rates for taxis???
- TGEoA
  
  If they didn’t we would have gypsy taxis with unreliable service.
  - Yes
    
    Compare the DC cabs with the ones here; it’s night and day. Arlington cabs (esp. Red Top) are very professional compared with the ones in DC, generally.
    
    Can’t believe I find myself agreeing with all these proposals. The hikes seem small, and four years is a long time between raises for anyone. And credit-card machines are a great idea. (Though many cabs already have them.)
    - Carl
      
      Doesn’t DC set rates too?
      - Yes
        
        It does, but I’ve read there are fewer other restrictions–can’t remmeber what they are. I think in DC you can be just a guy with a cab and hang out your shingle; not sure if Arlington allows one-car cab companies.
      - Zoning Victim
        
        Not really. There are licensing regulations you have to comply with in DC, just like there are in Arlington. In the typical fashion, Arlington makes you apply and provide a host of information, holds a public hearing, has the county manager make a recommendation whether or not to allow you to become a cab company and then decides whether or not to let you form a new cab company. At least that’s the way I read the ordinance. There does not appear to be any documented regulations preventing you from becoming a cab company unless you have a certain number of cabs; however, the county may effectively make it that way since there are no criteria for a successful application in the ordinance. In other words, if you and someone else have the same basic properties the county uses for consideration of worthiness for being a cab company, the board can still accept one and not the other without providing any basis for their decision. In fact, even if one proposed company owner beats the other in the list of factors the county considers when making a decision on awarding certificates to owners, they may pick the other, less “qualified” candidate. I made a quick read through the regulations and didn’t see any type of mechanism for appealing the board’s decision. I’m really not a big fan of rules that allow the board to pick anyone they want in situations like this.
      - Lou
        
        I think you are mostly correct. The most significant restriction is simply the number of licenses the county will allow. They are all spoken for among the cab companies that do business here. So the barrier for any new company to begin operation is having the county tell them they refuse to open up any new slots.
        
        This happened about a year ago when a new company applied to operate and the board rejected them. It was probably documented in and article on this site.
  - Chris M.
    
    This is what licensing is for, not rate setting.
    - Thes
      
      When a tourist hails a cab in Arlington, would we expect them to be able to competently negotiate the rate they will pay each and every time? Most cities around the world (at least the ones with cabs you hail from the street) set the rates, because it’s not practical to ask visitors to do it for themselves.
      - Zoning Victim
        
        What about when they order a beer? Oh-no, they could get overcharged for their beer. We’d better have the government start setting beer prices. Same with dinner, gasoline, hotels, rents; price fixing for everyone so nobody gets ripped off! Or is that everybody gets ripped off?
David Budimir

When will we see Uber cab in DC and Arlington?
novasteve

Each cab is one of those evil corporations the the evil republicans say are persons! booosh!!!!
SimplyDusty

The real impact is when they force the cab drivers to actually USE the credit card machines. That’s real progress!
- Burger
  
  Why is that progress? Why should a taxi driver have 3-4% of his fare be taken away to allow you to get points or miles.
  
  And further, why should someone who pays in cash subsidize your practice of using a credit card.
  
  We should go back to the cash price is cheaper than the credit price but that’s just me remembering when we put onions on our belt.
  - anon
    
    It’s not a pure loss for vendors to pay interchange. When you use your card, they don’t have to worry about keeping large amounts of cash on them, making change, etc. That may or may not be worth 3 to 4%, but it’s worth something.
    - Burger
      
      Sure on one ride that seems easy but when you clear 50K and aggregate it all up that works out to 1500-2000 dollars that isn’t going in to the cab drivers pocket but Visa/MC’s pocket.
  - Yes
    
    More like 2%. If it’s a $40 fare, you’re talking 80 cents, which a decent tip more than covers.
    
    And keep in mind they’ll get more fares if they accept credit cards. More people who have just blown all their cash at the bars will decide not to deal with the Metro at 3AM and just jump in a cab.
    - Burger
      
      Have you ever owned a small business – most small business do not get rates of 2% but 3-4% – and AMEX is strictly 5% for everyone.
      
      So you are not accurate. There is way more people seeking cabs than there are cabs. So I doubt they’ll see any change at all.
      
      But, if you want to play that game, does the extra fare they get at 3 AM equal out to the losses of 3-4% on the rest of the day?
soarlslacker

Red Top is a great cab company. In 20+ years I have never had a driver who made me feel uncomfortable. I never get in the cab line at National. I call for a Red Top Cab I don’t think they should change the rates for kids. Kids mess up a vehicle way more than adults do.
STee

This is absurd. The taxi drivers make more than enough money – the gas prices have stabilized – while I understand the need to adjust for inflation – all of us deal with inflation – and this is 10% — way more than the inflation of the last four years combined. Arlington couunty – do your job and vote with common sense.
- STee
  
  PS: Arlington cabs are about 10 to 12% below DC rates –
  - outoftowner
    
    Yet still quite high when compared to national rates
    - dk
      
      Um…isn’t the cost of living here quite high as well? Why wouldn’t we expect cab fares to be higher than the national average?
  - how so?
    
    where did you get this percentage from?
- Burger
  
  You must not buy bread or milk very often.
- drax
  
  What were the rate hikes in the last 4 years?
  
  Were there any?
- Zoning Victim
  
  I heard a report a few days ago that thanksgiving will cost about 13% more this year than it did last year because of the skyrocketing food prices. I’m not sure how 10% is unreasonable in light of that.
RightWingWhacko

OK, STee:

Since you can say they make “more than enough money” please tell me what the top salary should be? This way, we can adjust down since you know this stuff and obviously none of us would want to see any of these people be able to feed a family and have kids in school and maybe even pay a mortgage if not rent. We’re grateful for your expertise.
- John Fontain
  
  Is anyone stopping you from double-paying the cab drivers that you feel sorry for?
  - drax
    
    What’s stopping cabbies from giving discounts to people they feel sorry for too?
    - Zoning Victim
      
      The regulations prohibit that, which is the problem with the government fixing the price to begin with. They’re not just capping the price, they’re setting it.
Stuck

Are there service standards that can be enforced? Sat night could not get a cab (Red, Blue, Yellow or Enviro) to come to my home (near Lee Hwy and Spout Run) between 11:00 and 2 am. None. Notta. So there were people who were walking on dark roads to find one. Dangerous. Folks may also be less likely to cab next time, leading to tipsy drivers. Ridiculous. I get a long wait at peak hours – but nobody? And it’s not like we’re out in the sticks.
- Been Stuck Lots of Times Too
  
  Agreed, peak demand times are awful. It’s bad enough when you’re trying to get one between 6pm and 2am on a weekend night, but add rain or cold to that equation and its fairly impossible…and you get to find that out after sitting on hold for 30 minutes.
  
  As other posts on this site have pointed out, Arlington limits the number of cab licenses it allows even though the demand is out there. The County should allow the rate increase but should also put some effort into figuring out better ways to optimize the cab supply during peak times.
  - Lou
    
    If the county made it too convenient to get a cab fewer people would ride their precious metro.
  - Thes
    
    Arlington should allow cab drivers to charge more during insufficient-supply times. This would encourage drivers to shift their schedules to compete more for the peak-period trips. Other communities have taken this approach, and it works.
    
    The reason it has not been pursued in Arlington so far is the fear that if you charged a dollar or two more per late-night trip, people would suddenly become “discouraged” to take cabs and would instead drive drunk. I find this reasoning unpersuasive.
NBPA

I reject this offer and move to decertify
AW

$40,000 and $60,000 seems like a lot of money to drive a cab around town.
- Moosey
  
  But that’s for like 12 hours a day isn’t it? And is that after or before paying to lease the cab? Post had a story on DC cabbies the other weekend and said they average about $12/hour. I wouldn’t wanna live on that.
Joey

Increasing the additional-passenger charge is stupid. Additional passengers cost the driver virtually nothing more.

Shouldn’t we be doing everything we can to encourage people to share rides and take cabs over driving (esp. when drinking might be happening)?

If three people are going out to say, Clarendon, the $1.50 x 2 x 2 ways = $6 extra charge roundtrip for having the extra two people meets or exceeds the parking fee in the area. A group doing quick math might reasonably conclude it’s far cheaper to drive than take a cab.
Chris M.

A visitor usually has no idea what the rate is, whatever city he is in. There are asymmetric information problems, but that’s evey market. Social norms do a much more effective job of regulating these kinds of problems. There is ton of competition, so it’s really hard to charge monopoly prices. As such, I’m sure rates would be much more prominently displayed and negotiation would not be necessary.
- dk
  
  Letting the market set the prices essentially means pricing out lower income people. What cabbie would bother servicing lower-income areas if he/she could charge much more ferrying the wealthy around? What social norms would regulate this problem?
  - Zoning Victim
    
    This is not true. From wikipedia:
    
    Opposition to liberalizationRent seeking and bureaucratic self-interest currently dominate the making of taxi-market policy. Existing companies try to limit competition by potential new entrants. For example, in New York City the monopoly advantage for taxi license holders was $590 million in the early 1980s. The city has 1400 fewer licenses than in 1937. The main losers are the car-less poor and the disabled. [39]
    
    Taxi owners form a strong lobby network that marginalizes drivers and taxi users. It also pays to corrupt the officials to uphold regulation. [40]
    
    The regulators usually do not wish to rise against the taxi-owner lobby.[41] The politicians do not want taxi drivers to have a negative opinion of them.[42]
  - Chris M.
    
    This train of thought makes my head want to explode! (no offense meant) You could apply this logic to everything! Why don’t we cap gas prices, and shirt prices, and ipad prices!
    
    Even if I agreed with you, which I don’t, you SUBSIDIZES to solve the problem.
    
    Price fixing has failed in both theory and practice. It never produces a positive outcome. This is why we subsidies housing in the area, for example.
    
    P.S. isn’t that what a bus is for?
    - Zoning Victim
      
      Not to mention the fact that it actually keeps prices higher when you couple it with a restriction on who is allowed to move into the business. DC cab drivers only make about $12 an hour (according to them), but there is no shortage of people applying for new licenses. If the rate was at least only capped here, we’d see a decrease in the cost of cab rides.
Pingback: Why Not Have a Single, Strong Taxi Regulator for the Region? | Pike Spotter()
anonymous

DC cabbies are the biggest a**holes, but they charge a lot less than Arlington cabbies for the same exact route. Head over to DCist for more information on proposed DC fare hikes. It’s not isolated to Arlington
Lou Gatti

Read the staff report. Its as fictional as you can get. Here are some of the highlights:

-“ The general conclusions are that Arlington taxicab
drivers are on average earning annual incomes of about $40,000 to $60,000 after expenses, and
that expenses have increased on average about five percent since the time of the last fare
increase. Annual income figures are based upon revenues per cab and may vary depending on
hours worked and number of drivers per vehicle.”

SHOW ME ONE THAT MAKES $ 50,000 A YEAR AFTER EXPENSES

-“ As the County and taxicab industry do not want the taxi drivers to suffer substantial long-term
declines in income, options for fare increases have been considered. Several alternative means to
revise fares to better compensate the taxi operators were considered, including changes to the
initial drop charge, mileage charge and all other fare components.”

SOME OF THESE COMPANIES CHARGE THE DRIVERS $ 115 A DAY TO RENT THE CAB. WHAT DO THEY DO TO HELP THIS SUFFERING ?

-“Based on the analysis of the BLS index, the cost for operators has gone up approximately five
percent from the last rate increase in 2008 to 2011.”
THIS IS FOR THE TAXI COMPANIES. THEY HAVE ALREADY GAINED THIS BACK BY ADDITIONAL RENTAL FEES TO THEIR DRIVERS. SOME DRIVERS ARE PAYING $ 115 A DAY

2010 TAXICAB CERTIFICATE REPORT

County’s own report 2007-2009 change
Table 6
-Dispatched Taxi Trips ( 335,179) LESS !!
Table 8
– Airport passengers ( 2,626,171) . LESS!!
Table 9
– Aiport Passenger Arrival Trips ( 339,118 ) LESS !!
Table 10
– Hotel Occupancy ( 139,411 ) LESS

THESE ARE THE COUNTY FIGURES !!

THIS IS JUST ANOTHER PLOY TO PUT MORE MONEY IN THE CAB COMPANIES COFFERS. IF YOU WANT TO HELP- HELP THE DRIVERS !! THEY ARE THE ONES THAT NEED HELP. FOR THE MOST PART, THEY DO NOT MAKE MINIMUM WAGE OR EVEN CLOSE TO IT.

Lou Gatti

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