Aldermen temporarily tabled an ordinance that would “simplify” the city’s licensing fees and application requirements for taxis, ride-share cars, horse-drawn carriages, and pedicabs, after taxi drivers warned they can no longer make a decent living due to the “flood” of competing ride-hailing drivers on city streets.

After a roughly two-hour long hearing that focused more on concerns that the city’s taxi industry is on the verge of bankruptcy than the ordinance at hand, Chairman Emma Mitts (37) announced she would hold on to the ordinance and have the committee reconvene next Monday, after those concerns were addressed.

The ordinance that sparked outrage from the city’s taxi industry sought to modernize and simplify licensing requirements and reduce certain fees and penalties, according to Business Affairs and Consumer Protection Commissioner Maria Lapacek. Specifically, it makes the following changes:

  • Adds new definitions: A “public chauffeur license” now refers to a restricted chauffeur license or a taxi chauffer license. The former license pertains to divers employed by ride-share companies, the latter to taxi drivers. A licensed restricted chauffeur cannot operate taxicabs. The new definitions were added to “clarify” the different licenses offered by BACP, Commissioner Lapacek said.

  • Increases fines for unlicensed activity: Those operating a taxi without a public chauffeur license will have to pay $500 to $1,000 for each offense. Currently, the fine range is $75 to $400.

  • “Simplify licensing requirements”: Those interested in applying for a public chauffeur’s license only need to have had a driver’s license for one year, instead of three. They are also no longer required to have an Illinois driver’s license. This change was made to accommodate drivers from ride-hailing companies who have out-of-state plates but want to pick up customers in Chicago, Lapacek explained.If an applicant had their driver’s license revoked within the past three years, they will be rejected. The current moratorium is five years.The number of traffic violations an applicant may have in a 12-month period increases from two to three. It decreases the background check period for a suspended driver’s license from five years to three years. These changes were made to “level the playing field” for taxi drivers and those employed by ride-hailing companies, although several who testified said it didn’t go far enough.

  • Investigations: The BACP commissioner can investigate applications for new or renewed licenses, including reviewing the applicant’s criminal record, driving record, complaint history, and “any other information that may be reasonably relied upon to issue a license.”

  • “Outdated or burdensome laws” eliminated: This includes the prohibition against loitering, courteous behavior, and the surrendering of chauffeur’s licensing, among others. The minimum fine for violations imposed on taxi drivers who violate the city’s licensing rules was lowered to $50 from $75.  

  • Changes to Horse-Drawn Carriage Licenses: The ordinance lowers the licensing and renewal fee from $25 to $5, removes the provision requiring applicants speak, read, and write English, and adds “cannabis or other illegal drugs” to the list of substances tested. These licenses would be valid for two years from date of issuance. Currently, it’s one year. The city has 30 horse-drawn carriage licences, so the decrease is minimal and aimed at creating consistency among all the licenses to prevent an equal protection lawsuit, Commissioner Lapacek explained.

  • Changes to Pedicab Licenses: Fee for license reduced from $25 to $5. It also adds a section clarifying the definition of a pedicab license: “A person engages in a pedicab business by seeking or accepting a fee, an economic benefit of a donation or gratuity, or any form of compensation (goods or services) for providing transportation to passengers in a pedicab.”

The ordinance was drafted in consultation with a task force Mayor Rahm Emanuel put together in 2014 to “strengthen the taxi industry and create a fairer environment for taxicab drivers.” But several members of that Taxicab Driver Fairness Task Force testified the ordinance barely addressed their concerns.

Over the course of public testimony, divers and industry stakeholders argued since the Mayor allowed ride-hailing companies like Uber and Lyft to operate in the city, medallion cab drivers have spent hours waiting in taxi lines at city airports and driving around the city for hours without customers. As a result, they say they can barely afford to pay their regular lease payments to their employers.

“Myself and every other member on the task force has told the commissioner, the deputy commissioner, and the mayor’s office, over and over again, that the city needs to level the playing field with ride-share, or the taxi industry will be destroyed,” said Ezzedin Abdelmagid, with Cab Drivers United. “And when I say destroyed, I mean my job will be destroyed. Thousands of full time, family supporting jobs will be gone. Transportation access for disabled people in the city will not exist. Millions in city revenue the city collects from taxis will disappear.”

“The assets and retirements and dreams of many small medallion holders have already been destroyed in the last couple of years. If you think this ordinance is going to do anything to level the playing field, you are mistaken,” he added, saying many are going into debt.  

According to Meg Lewis, a researcher with AFSCME, there were no medallion foreclosures two years ago. Now, there are 97 foreclosures, with 28 in the first month of 2016 alone. In 2013, only five taxi companies surrendered their medallions. This year that number is 524. And only one medallion has been transferred since October 2015, at a measly $95,000. That’s a significant drop from the roughly $300,000 price tag on some medallions three years ago.

Since the city opened up the airports to ride-share drivers, a month-to-month comparison of January 2014 and January 2016, the number of taxi rides has gone down by 40,000, Lewis added.

“Although [this ordinance] does address pedicabs and it does address horse-drawn carriages, [it’s] completely silent on the issue that every single member of the task force said was a number one pressing issue for taxi drivers and for fairness in this city,” Lewis argued.   

Other members of the task force who testified against the ordinance reaffirmed their demand to have the city require ride-share drivers be held to the same licensing requirements as cabbies and that the City Council hold hearings on the impact ride-hailing companies have had on the industry.  

Their pleas struck a nerve with several on the committee, like Ald. Chris Taliaferro (29), who, towards the end of the meeting, expressed concern the city was creating a monopoly that could end up being very costly, not only in terms of the legal ramifications but also the number of jobs lost.

But most of the outrage over the ordinance came from Ald. John Arena (45), who accused Commissioner Lapacek of “misleading” aldermen, because her office “completely failed” to properly regulate ride-hailing vehicles or hand over “specific data.”

“You continue to come before us with not good information, and, I feel, misled us into what we’re doing here and continue to say we’re fixing this problem. But what we keep hearing is the one thing that would fix the problem is to really regulate TNPs (the license for ride-hailing drivers). That’s what the core problem is. So I’m not going to support another change at all. I’m going to continue to block this, because we’re being lied to. Your department is not doing its job,” Ald. Arena charged.

Before Comm. Lapacek has a chance to fully respond to Arena’s accusations, Chairman Mitts stepped to tell him to speak with her after the meeting and announced she would hold the item and recess the meeting until Monday.

“I understand the problem from the taxi industry, I understand the problem from the ride-share industry, it’s the way we have to come together as a whole to fix this problem,” Mitts interjected. “Because we’re taking jobs and people need jobs… we’re here to fix a problem.

The committee also approved a proposal by Ald. Deb Silverstein (50) to legalize certain “cat cafés” in Chicago. Ald. Silverstein’s application would let animal shelters serve non-alcoholic drinks, but beverages could only be sold in a designated cafe area and to prospective adopters. The two-year permit would cost $250, and only applicants with a valid animal care license, or a member of a humane society “whose mission is to rescue animals” would be eligible. The city’s health department would enforce the rules and violators could face up to $1,000 in fines.