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Cab Companies Sue Over Move To Open San Diego’s Taxi Market

A taxi is shown driving through the Gaslamp Quarter in this undated photo. 
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Credit: Flickr / Leandro Neumann Ciuffo

Above: A taxi is shown driving through the Gaslamp Quarter in this undated photo.

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The number of cabs allowed on San Diego roadways is set to go from 993 to an unlimited number on April 1. A coalition of cab owners is trying to stop that.

A coalition of cab companies has filed a legal complaint against the Metropolitan Transit System, asking for an injunction on efforts to open the taxi market.

Beginning April 1, the number of cabs allowed on San Diego roadways is set to go from nearly a thousand to an unlimited number.

The cab companies claim the move violates the California Environmental Quality Act because the city, which contracts with MTS to manage the taxi industry, didn't complete an environmental review before allowing more smog-producing cabs on the road.

"There are environmental issues that will affect the overall quality of life. That was never addressed," said Michele Anderson, who represents cab company owners via the San Diego Transportation Association. "Will the number of taxicab permits double? Will it triple? Will it quadruple? Nobody ever answered that question."

More than 700 individuals have said they plan to apply for permits next month, said MTS spokesman Rob Schupp.

But Councilwoman Marti Emerald, who led the effort to open the market, said many of them already drive San Diego streets in leased taxis. She said she expects the industry to "go through some growing pains" but it won't see a huge net gain in the number of cabbies on the road. She also said new permit holders could mean new low-emission vehicles to replace older taxis.

The complaint's focus on California's strict environmental rules could be strategic. Buried at the end of the complaint is an allegation the change is unconstitutional because the city took cab companies' property without compensation. They're referring to taxi permits bought for an average of $120,000 that will lose their value when the city lifts its permit cap.

Owners in Milwaukee made a similar claim last year, but the courts didn't grant an injunction.

"What's happening in Milwaukee is what's happening in Milwaukee," Anderson said. "This is San Diego and we're going to let a California court decide if indeed it is taking."

San Diego City Attorney Jan Goldsmith will handle litigation for the transit system.

The city pushed the change through after a San Diego State study found many drivers who leased cabs from permit holders were earning less than minimum wage. Many permit holders bristled at the claim.

"I understand the effort to stop this. The current permit holders have an investment here, they have a business model that's been working for them and they're going to fight for it," Emerald said. "But we stand by the program. I genuinely believe that it's time to give these lease drivers the opportunity to work for themselves and to be able to make a living."

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