Speaker: Dr. Gorman Gilbert, Director, Institute for Transportation Research and Education, North Carolina State University

Just as the taxicab is an important symbol of New York City, so too is the medallion a critical symbol of the New York City taxi industry. A small plaque affixed to the hood of each yellow cab, the medallion was first sold in the 1930's for ten dollars. Recently the price reached $140,000, meaning that the 11,787 taxi medallions have a combined value of over $1.5 billion. It is not surprising, therefore, that any attempt to reform the medallion system encounters severe opposition from the existing taxi medallion owners. In fact, each attempt to reform the medallion system has failed, and there are actually fewer taxicab medallions today than in the 1930's.

While the number of taxicabs was frozen, the demand for taxi service expanded. The growth of New York and its increased importance as a business and tourist destination produced ever-increasing demands for taxi service. The result was a development of a new transportation industry: the for-hire vehicle industry. Composed of black cars, liveries, car service, and limousines, the for-hire vehicles grew rapidly in number to meet the demands of the traveling public. Today, the for-hire industry includes approximately 30,000 vehicles.

The regulatory dilemma posed by a frozen taxi medallion industry and a rapidly growing for-hire industry is challenging. Should the medallion system be scrapped? Should for-hire vehicles be allowed to respond to street hails? Should there be medallions for for-hire vehicles? All these regulatory questions point to a more fundamental and important question: What regulatory steps are needed to improve the quality of service available for all New Yorkers?