Cascade Policy Institute

This proposal is one of ten winning reports from the 1996 Oregon Better Government Competition. The 1994 and 1996 Competitions were organized by the Portland-based Cascade Policy Institute. Opinions expressed are those of the author(s) and not necessarily those of Cascade staff or advisors, nor should they be construed as an attempt by Cascade Policy Institute to influence any election or legislation.

Published article summarizing this proposal

Opening Portland's Taxi Market


by John E. Kramer and William H. Mellor
Institute for Justice, Washington, D.C.

Executive Summary

Portland taxicab regulations limit competition by restricting the opportunity for current taxi drivers to work for themselves, and new companies to enter the market. In addition to would-be entrepreneurs, these restrictions harm the very individuals most likely to rely on such ransportation: the poor, elderly, and others with fixed or low-incomes. They, and other taxi customers, are harmed in at least two ways. First, a low level of competition leads to higher fares. Second, the lack of competition decreases service; for example, fewer taxis increase the amount of time it takes to get a ride.

To improve Portland's taxi service fundamental changes are needed to the virtual command-and-control monopoly imposed by the city government on the local taxi market. The Bureau of Licenses should open entry into the taxi industry and regulate cabs to protect public safety by requiring a drivers license, a background check on drivers, a safe vehicle and adequate liability insurance. Beyond that, regulations harm the consumers of taxi services, and they trench on a basic civil right to economic liberty: The pursuit of a business or profession free from arbitrary or oppressive government regulation.

Model legislation is available from the Institute for Justice: 1717 Pennsylvania Avenue, Washington, DC 20006. Tel: (202) 955-1300.

About the Authors --
John E. Kramer, who is Director of Communications of the Institute for Justice. Mr. Kramer helped secure the extensive media coverage essential to the Institute's successful campaigns to open taxicab markets in Denver, Indianapolis and Cincinnati. He has been a public relations practitioner for 10 years, working for organizations including the Nevada Society of Certified Public Accountants and a Washington, D.C.-based public relations firm.

William H. Mellor, who serves as President and General Counsel of the Institute for Justice, which he co-founded on September 1, 1991, to litigate in the areas of economic liberty, parental school choice, property rights, and reducing the Regulatory Welfare State. The Institute also teaches public interest litigation skills to lawyers, law students, and policy activists. Mr. Mellor was the lead attorney in the Denver taxicab monopoly challenge and headed up the Institute's successful efforts in both Indianapolis and Cincinnati to open those markets. He is the author of the recent study, "Is New York City Killing Entrepreneurship?"


Introduction

As the following report demonstrates, the argument for opening taxicab markets rests on the principle that government should not protect for-profit taxi companies from competition to the detriment of the riding public as well as would-be entrepreneurs. Rather, government's proper role should be to protect the public's health and safety.

Imagine an industry where government allows existing companies to veto a new competitors entry into the marketplace; where expectant rivals must demonstrate that they will not compete with current establishments. Long-standing restaurants could block the opening of future restaurants because they might take customers away. Public relations firms could halt new firms from coming into Portland because they may duplicate already available services. And to find employment in that field, people must abandon their entrepreneurial spirit and have no choice but to work for someone else.

As far fetched as this sounds, this is how Portland's taxicab market currently operates.


The Problem: Portland's Closed Taxicab Market

Elusive Permits

Since 1979, the city of Portland, through its Bureau of Licenses, has imposed an unofficial moratorium on the number of taxicab permits (licenses required to operate a taxicab) it issues. Under the "public convenience and necessity" standard imposed that year, the City of Portland gives existing companies an unfair advantage - in fact a veto on entry - over would-be competitors. The control appears to be in the hands of government, when in fact it is in the hands of existing companies. In addition, public convenience and necessity creates an insurmountable presumption in favor of current companies who can examine applications of new companies that identify new market niches and then provide new service to capitalize on the service the applicant has identified.

Perhaps it is no surprise that since the public convenience and necessity standard was enacted, not a single new cab company has entered Portland's taxicab market. The last new entry into the market was in 1976. In a five-year period, from 1985 through 1990, not a single one of the five applications to begin a new cab company was accepted. The four taxicab companies currently in business in Portland (Radio Cab, Broadway Cab, New Rose City Cab, and Portland Cab) have been around since at least 1979. And no applications for new cab companies are currently pending.1

Market Entry

In Portland, taxicab companies must have a city-issued permit to operate.2 Permits are issued only to taxicab companies and not to individuals.3 Applications for a taxicab company permit are submitted to the city's Taxicab Supervisor who then forwards the application with his/her recommendation to the Taxicab Review Board. The Board reviews the application then sends the application along with its recommendation to the City Council. The Council conducts a public hearing regarding the application and considers the following factors:

If the permit is granted by the City Council, the cab company begins paying an annual taxicab permit fee. The annual fee is $100 times the fixed number of vehicles operated by company. Permits are renewed automatically unless revoked.5 No taxicab company permit may be assigned, transferred, merged, leased, or mortgaged without prior consent of the city.

Each cab company is limited to a set number of taxicabs it may operate. The city determines the fixed number by means of a review conducted in the fall of every odd numbered year by the Taxicab Review Board.6 This review analyzes market demand based on, but not limited to, the following factors:

Portland is currently limited to 317 taxicabs. The number is divided between the four companies as follows:
Standards

In addition to limiting the number of taxi permits issued, the bureau also sets administrative and minimum service standards, such as:

Each taxicab must also meet a minimum safety inspection. These require cabs to be:
The inspection of cabs is conducted by the companies themselves, but each company must furnish the Taxicab Supervisor with a report of the maintenance status. It should be noted that the city has never revoked a cab company's permit.11

In addition to the 317 cab licenses, the board has also granted 50 "limited passenger permits" for vehicles transporting specialized serves to limited segments of Portland's population. These "limited passenger transportation permits" are primarily issued to operators transporting people needing non-emergency, medical transportation. Although this latter group does not affect the cab industry in any legal way, it is interesting to note that only 12-15 percent of Portland's cabs are handicap accessible.12 The Taxicab Review Board set a goal for the industry to have 20 percent of taxicabs handicap accessible by January 1998.13

Rates

There is a flag-drop fee that City Council recently raise 50 cents to $2.50. Thereafter it is ten cents per fifteenth of a mile or fraction thereof ($1.50 per mile.) Additionally, there is a $15/hour waiting charge fee proportionate to the time a hired cab spends under 10 miles per hour. Finally, there is a $1 additional person charge, that was raised by 50 cents by the City Council. Each driver is allowed to determine the number of additional persons he/she will allow. These rates are ceilings which individual companies can undercut. Despite the ability to charge less, all four cab companies in Portland charge this amount.14

Zones

The city of Portland designates various areas to be a Taxicab Zone for pickup of passengers. No taxicab drivers may park in the zone unless their respective company has filed an annual application and paid the required Taxicab Zone permit fee. The amount of this fee is determined by the Bureau of Traffic Management.15

Table 1, available from Cascade Policy Institute, compares Portland to recently opened taxi markets. It demonstrates that inflated prices and market stagnation are the predictable result of Portland's command and control taxi market.

A National View

Nationally, barriers to entry are entrenched and long standing. A 1974 study by the U.S. Department of Transportation found that regulations restricting entry of new cabs and preventing discounting of fares cost consumers nearly $800 million annually adjusted for inflation to 1992 dollars. Moreover, removal of these restrictions would create 38,000 new jobs in the taxi industry.17

Closing the Poor Man's Gateway, Creating Urban Sharecroppers

According to one recent report, driving a taxi is the most dangerous profession in America.18 Unfortunately, Portland's drivers are not exempt from this national trend. In 1994, a driver was shot in the head and killed while waiting at a cab stand.19

As The New York Times noted, taxi driving has for generations been recognized as a "poor man's gateway to mainstream America."20 But Portland's current regulatory scheme benefits only the existing permit holders, their lobbyists, and their lawyers, and not the men and women who put their lives on the line to provide this service. As a result, most of Portland's taxi drivers do not enjoy the fruits of their own labor. They must pay exorbitant weekly fees for the "privilege" of driving for someone else who owns the taxi permit when they might just as soon drive for themselves. In essence, cab drivers become urban sharecroppers.

The birth of the modern taxicab in the United States occurred without restrictions on the free market; still, those restrictions were not long in coming. Some believe today's heavy regulation of the industry in the United States began in response to "ruinous competition" that harmed the public during the Great Depression. To the contrary, close historical analysis indicates that, not only was there no "ruinous competition," but the majority of taxicab regulations were already in place in the late 1920s.21 During the 1930s car prices and wages fell, bringing large numbers of drivers into the industry. The Federal Trade Commission found that:

Many unemployed workers entered the taxi industry using rented cars, and as a result taxi fares, occupancy rates, and revenues per cab declined. Pressures for restrictions on the taxi industry came from the American Transit Association, public transit firms, the National Association of Taxicab Owners (which passed a resolution favoring entry and minimum fare controls) and the established taxi fleet.22

Entry restrictions did not even pretend to protect the "public interest," and were often couched in explicitly anti-competitive terms. Improved safety or reduced congestion and pollution were occasionally given as reasons, but only as after-the-fact rationalizations. In reality, regulators wanted to "drive many cut-throat cabs, operating without authority, from the streets and. . .enable the organized cab fleets and transit companies to increase their profits."23

There has been little change in the way taxicabs are regulated since the wave of restrictions of the 1920s and 1930s. For example, with the 1937 Haas Act, New York issued 13,566 taxicab medallions. Today, there are only 12,187 medallions in the city.24 Existing medallions can be sold to new operators, but at a price of $175,000 apiece, most aspiring entrepreneurs lack the resources to enter the profession. Similar artificially high costs of entry exist in the majority of U.S. cities. Over the years, the taxicab industry in heavily-regulated cities (like Boston, Buffalo, Albany, Houston, Los Angeles, Miami, Salt Lake City, San Antonio and San Francisco) has stagnated. Poor quality, high fares, and long waiting times are standard in many cities where taxicab giants have taken control of the market with the aid of regulation. Los Angeles, where regulations forbid new taxicab services, clearly illustrated this pattern; powerful monopolies bought out the competition and raised taxicab fares, while new competition could not enter the market.25

While some cities prohibit outright new entrants to the taxicab market, others achieve the same results while preserving the facade of open entry. Many cities like Portland condition entry on a showing of "public convenience and necessity," a standard which, in practice, proves almost impossible to satisfy. A 1983 survey of 103 cities with populations of 50,000 or more found that 87 percent restricted entry in some manner:

30 percent had a fixed number of licenses; 9 percent had a fixed ratio of licenses to population; 25 percent required a showing of public convenience and necessity to obtain a license; 6 percent had franchise requirements; and 17 percent had minimum service standards.26

While safety and insurance requirements are valid, there is no reasonable basis for restricted entry. A 1984 study of taxicab regulations by the Federal Trade Commission concluded that "there is no persuasive economic rationale" for most regulations, stating "restrictions on entry, minimum fare controls, and restrictions on ride-sharing. . .reduce rather than increase efficiency.27 Economists, left and right, agree virtually unanimously and state that consumers are the big losers (second only to would-be cab owners); they pay higher fares, wait longer for a cab, and get worse service than they would with competition.28

There are about 550 taxicab drivers licensed to drive Portland's 317 cabs.29 In addition to a valid state-issued driver's license, taxicab drivers are required to obtain a city-issued taxicab driver's permit. This permit requires a $35 application fee and a $25 annual renewal fee. The Portland City Taxicab Supervisor reviews the application and then, with the approval of the Board, either denies or approves the application. This review looks into such factors as criminal and driving records. The supervisor may overlook negative information if the Supervisor concludes that the applicant has established that such negative behavior is unlikely to happen again. After an initial 30-day temporary permit expires, supervisor either grants or denies the annual permit. No driver can operate without proof of permit. No driver may operate by use of another driver's permit card. The supervisor has the authority to suspend or revoke permits.

In addition to public health and safety concerns, there are also prohibitions on charging a fare higher than the city scheduled fare and a prohibition of the refusal to transport any passenger to requested destination within the city. Drivers are limited to 14 hours within a 24 hour driving period.

But Portland's taxicab drivers must also find a taxicab company that will hire them. And they must pay that company between $250 and $450 a week for the "nut" or lease to use the company's permit. A recent letter to the editor from Dennis Johnson of Southeast Portland, who has driven a cab in Portland for 10 years, summed up the hard place in which drivers find themselves when he wrote, "My largest operating expense, which I am required to pay, is the cost of leasing the permit from the company. This only allows me the right to work each day and must be paid whether I can work or not. If I am sick or my car is being repaired, I still must pay."30

As Patrick Fesler, president of Pride (Portland Region of Independent Drivers and Extra-Men) said, cabbies have little freedom in Portland's rigid permit system. Fesler and about 100 drivers have called on the city to issue taxi permits to individual drivers, who then could drive for themselves or any company they choose.31 In response to suggestion that drivers be put in the driver's seat, the city's Taxi Supervisor said that it would be a major hardship on his one-man taxi regulatory department to oversee 550 individual cabbies.32 With all due respect, protecting the status quo and limiting individuals' opportunities to improve their lives because it is going to make a bureaucrat's job easier isn't a good enough reason to block new opportunity. One might well laugh when juxtaposing this view to the industrious spirit of the men and women who forged the Oregon Trail to find a better life for themselves and their families.

So rather than the city's bureaucracy adjusting, perhaps even growing to meet the needs of the marketplace and the demands of consumers/taxpayers, the city is unfairly giving the upper hand to company management while holding the hands of drivers behind their backs. Conditions for the drivers are so bad that the Taxi Supervisor and the Bureau of Licenses Manager were forced to admit in their report, "Drivers who barely subsist on their earnings often work exceedingly long hours in an attempt [to] increase their earning."33 But rather than coming to the aid of the drivers and looking to improve their condition by creating an opportunity to work for themselves and reduce the monetary burdens associated with driving a taxi, the authors suggest, "It is suggested that the City regulate the number of consecutive hours a driver may drive and the number of hours of rest between shifts."34 If drivers could work for themselves and compete, they wouldn't need to drive so many hours to "cover their nut."


The Unseen, Underserved Customers

Poor, minority, and elderly consumers are hit especially hard by these regulations.35 Members of these groups are less likely to own cars and are more likely to live in areas that are served poorly, if at all, by taxicabs and other forms of public transit. A 1978 study commissioned by the Urban Mass Transit Administration determined that by every measure, low-income individuals "rely more heavily on taxicabs than do higher income individuals."36 As another study, conducted in 1980, concluded:

In addition to causing misallocation of resources, taxi regulations adversely affect the distribution of income. Low-income people spend a larger percentage of their incomes on taxis than do high-income people, and in many taxi markets, consumption of taxi rides per capita is higher for low-income people. As a result, [these regulations] impose a disproportionate burden on low-income people.37

The Limousine Market: Open, Competitive & Vibrant

In stark contrast to the regulation-imposed stagnation on the taxi industry is the relative freedom and vitality experienced by limousines.38 In the spring of 1995, the Port of Portland began welcoming executive cars to provide their service to those arriving in the city. Now, for about $25 (approximately the same cost as a taxi ride,) limousines, equipped with faxes and an awaiting Wall Street Journal, provide a higher standard of service from downtown Portland to the Portland International Airport. This is typical of other cities where taxicabs are regulated while other industries are allowed to follow market forces. According to information distributed by the Indianapolis mayor's office, before Indianapolis opened entry into the taxi market and deregulated fares, riders could hire a 35-foot limousine (the price of which is unregulated) with a television and VCR to or from Indianapolis International Airport for half the price of a taxi on the same route.

The taxi industry's response to the growth of limousines has been purely anti-competitive. Rather than calling for its own deregulation, which would allow new competitors to enter the field and compete for their corner on the market, Portland's cab industry implored the City Council intervene and impose more regulations on limousines. In this Portland was typical of efforts nationwide as a 1988 Forbes feature titled, "Regulation at its Worst," reported that, "Since 1980 the number of limousine livery companies nationwide has grown fourfold, to 6,500. Predictably, the taxicab industry's first response has often been to demand that regulators squash the upstarts by controlling their numbers, rates and airport pickups."39


The Solution: Opening Markets/Opening Opportunity

To improve poor taxi service and offer opportunities to would-be entrepreneurs, we suggest fundamental changes to the command and control monopoly imposed on Portland's taxi market with its fixed number of cabs as well as its fixed pricing. The Bureau of Licenses should open entry into the taxi industry and regulate cabs to protect public safety by requiring a license, a background check on drivers, a safe vehicle and adequate liability insurance. Beyond that, regulations trench on the basic civil right to pursue a business or profession free of arbitrary and oppressive government regulation.

To allow the market forces to work, the City Council should maintain flexibility in rate structure along with opening entry to the industry. This would allow drivers to expand their base of customers by offering competitive fares, especially to the elderly - the fastest growing segment of society who rely heavily on taxicabs, but many of whom also have fixed incomes. To protect visitors to the city as well as others who rely on taxi service who may not be familiar with rates, a fare ceiling may be imposed to restrict any price gouging that may occur. Indianapolis used this approach recently with successful results. This price ceiling, below which competitive fares could be offered, would in all likelihood be what cabs must charge now. With this kind of price competition joined with competitive services, the taxi industry can compete for customers like grocery stores, dry cleaners or any other less regulated industry.

The fundamental question that must be considered is this:

Why should the City of Portland maintain regulations that protect current taxi permit holders from competition that would be offered by otherwise qualified and capable citizens, who merely want an opportunity to work for themselves and earn an honest living?

The answer is simple. It should not.

To open the taxicab industry in Portland, we offer model legislation in the appendix, which was used in Indianapolis in that city's effort to open up opportunity for those who have been shut out of the system. Optimally, we would like to see the benefits of freedom extended to the entire ground transportation industry. This model is by no means the definitive solution to solving Portland's taxicab woes, but it provides a starting point for discussion.


Public & Private Cost

Public costs of maintaining the current system include increased subsidies for inefficient public transportation, increased fares, loss of tax revenue from new businesses, and costs of maintaining an inefficient bureaucratic regulatory apparatus. Private costs include higher fares, less efficient service, foreclosed avenues of productive livelihoods and loss of employment-creating endeavors for the economically disenfranchised.

If open entry is achieved, there may by some additional administrative costs for vehicle inspection, insurance verification, driver training and so on. Much of these costs could be shouldered, however, by the taxi industry itself in the form of administrative fees when seeking a license.


Legal, Political & Other Obstacles: The Vested Interest

Stagnation isn't progress.

Both Portland's Taxicab Supervisor and its License Bureau Manager are advocates of the public convenience and necessity standard, which sets an entry standard that is impossible for new entrants to satisfy.40 Perhaps that is why Portland has not had a new cab company take to the streets since 1979, when the standard was adopted. Under this standard, applicants must prove that they can provide services which cannot be provided by existing companies. The burden of proof is on the applicant to demonstrate that there is a need for additional service.41

The current bureaucracy's ambivalence for needed reform and the perhaps too-close relationship between the regulators and the regulated can best be demonstrated by its comprehensive report on the city's taxicab regulatory policies and practices. In the report the authors state, "Staff and the industry (emphasis added) agree that there is no great demand for increased numbers of taxicabs at this time, that some companies are under-utilizing their fleets, and that any increase in demand over the next two years can be met with current supply (301 cabs)."42 And yet in the next sentence, the report demonstrate that their is enough market demand that "non-permitted persons are providing taxicab service in the City of Portland in defiance of regulations."43 One might well ask if there is "no great demand for increased numbers of taxicabs" why are there non-permitted persons competing? If there weren't enough market demand, they couldn't afford to compete and they would choose another line of work.

Among the report's conclusion is "The existing regulatory scheme in Portland is preferable to the medallion system." We could not agree more. However, the medallion system and unregulated open entry are not the only solutions available, as we will discuss in the coming pages with example set in Denver, Indianapolis and Cincinnati.

To a great extent, having a closed system, such as Portland's taxi industry, creates a public subsidy for those inside the system. Permit holders are shielded from competitors and therefore the value of their operations increase disproportionately. They will fiercely challenge anyone who seeks to take away that unfair advantage. The concentrated benefits provided permit holders gives them enhanced political as well as economic power. However, the inevitable existence of beneficiaries of a subsidy does not justify maintaining a corrupt or unconstitutional system. Good people can benefit from unjust laws. The most common industry arguments against opening entry are:

Making Existing Companies Compete

The most frequently raised argument employed by taxi companies and their lobbyists against opening entry is that adding more cabs on the street will cut into their market share and make them earn less money, perhaps even go out of business. One would be hard-pressed to find another industry where the city government gives such protection to existing for-profit companies. For example, would the city allow pizzeria owners to veto the entry of new pizzerias to the city because they might duplicate the service current restaurants are now providing. There are no guarantees that existing companies will not lose market share to new companies--nor should there be. Eliminating over-reaching government regulation on both entry and fares will let the most efficient companies that provide the best service at the best price thrive, while those that don't meet those market demands will not.

Opponents also occasionally claim there is no need to open the market because there is a chronic shortage of drivers for the limited number of permits that already exist. However, with the high lease prices drivers must pay taxicab permit owners, it is no wonder drivers are hard to come by. By opening the market and allowing drivers to work for themselves, more owner/drivers (rather than merely drivers) can be expected to enter the market.

Taxis as Utilities

The taxi industry sometimes describes itself as a utility--an entity that is as vital to a city as water or electricity. But while historically it may have been common for governments to protect large capital investments of electric and water companies, such practices have no analogous purpose in the taxicab industry. Recouping the investment in a car is not in the same league as a capital intensive utility. Furthermore, with relatively inexpensive - even automated - cellular communications and dispatching equipment readily available, such systems can be created for a relatively modest investments. Finally, cabs are not essential services like water and electricity.

Assessment for Replication

What we are suggesting for Portland has been accomplished in other equally difficult environments with equally onerous regulations. The situation was so bad in Denver that the Rocky Mountain News led off an editorial discussing the Institute for Justice's effort to break down Denver's taxicab monopoly with the following statement:

We used to describe the Colorado Public Utilities Commission [which oversees taxi regulation] as an Eastern European-like agency for its suffocating oversight of transportation, but lately that label has become an unfair insult to most of Eastern Europe. Yet even as Poles, Czechs, Slovenians and the like liberate themselves from the shackles of anti-competitive laws, our own PUC continues to coddle artificial monopolies that punish consumers and bar small-time entrepreneurs from making a decent living. 44

Through the Institute's efforts, similar opening of markets was successfully carried out over the past two years in Denver and Cincinnati, as well as Indianapolis. Early indications are that results are positive. For example:

In Denver, an African American owned taxi company became the first new entrant into the market in nearly 50 years. Today, Freedom Cabs employes nearly 100 drivers who pay less to lease a vehicle than they would at other companies and the minority Five Points community at last receives taxicab service;

In Cincinnati, after open entry, 237 new taxis (mostly driven by driver/owners,) have begun providing the city with additional service;

In Indianapolis, there is a 40 percent rise in the number of new cabs on the street. Seventy-five percent of the new companies are female or minority owned. Nearly all of the new taxi owners are former drivers who had long-wanted a chance to own their own business. After only six months of opening entry, fares were reduced: pick-up charges dropped 12 percent; the average mileage rate dropped three percent; and the average first-mile rate dropped seven percent. Cabs are safer with all companies passing police background checks, enhanced safety inspections and verification of at least $100,000 in insurance coverage. The program has been so successful that since taxi the market was opened, the city did not receive one written complaint; whereas they used to receive hundreds of complaints annually.

Other efforts at opening entry have also proved successful at getting new driver/owners on the street:

. . .the number of taxi rides per capita in Washington, D.C., where entry is not restricted and fares are low, is over four times as high as in San Francisco, a comparable size city where entry is restricted and fares are higher.45

Despite these victories, the need for additional, strategic replication of the taxicabs industry opening is great. Cabs remain heavily regulated in cities such as Boston, Los Angeles, New York, Miami, Buffalo, Houston, and San Francisco, where market entry is tightly restricted.

Conclusion

The personal impact of the de facto ban on new taxicab businesses on the lives of would-be cab owners and drivers is devastating. It impairs their ability to earn a good living for themselves and for their families. It limits their opportunity to develop their considerable skills and to work for themselves, instead of others. It destroys their dream of a brighter future. These aspiring entrepreneurs realize there is no guarantee of success in a competitive economy, but it was only upon encountering this ban that they realized that they would not even have a chance to compete. Until Portland's oppressive ban is removed, they will be denied one of the most basic civil rights - the right to earn an honest living.

Perhaps the best statement that can be made on the subject of opening opportunity by opening taxi markets was written by Linda Cagnetti of The Cincinnati Enquirer who wrote:

No city should erect barriers that shut out . . . entrepreneurship. A vote for deregulation is more than a squabble over taxicabs. It's a stand for equal opportunity, jobs and individual initiative - basic ingredients of the American dream. 46

Endnotes

1. Dennis Nelson and John Hamilton, City of Portland Taxicab Regulatory Policies & Practices: A Comprehensive Report, April 20, 1992 and phone interview with Dennis Nelson, Bureau Manager, Bureau of Licensees, City of Portland, and John Hamilton, Taxicab Supervisor, City of Portland, conducted March 12, 1996.

2. Ordinance No. 165947, Portland City Code, (§16.40.210 as passed by City Council October 28, 1992.)

3. §16.40.110.

4. §16.40.215.

5. §16.40.220.

6. Nelson & Hamilton, pg. 11.

7. §16.40.225 and its amends §16.48.010.

8. §16.40.510.

9. §16.40.720

10. §16.40.720 and see the Administrative rules governing operating standards.

11. Hamilton interview.

12. Hamilton and Nelson.

13. Nelson and see Administrative Rule governing the accessible vehicle standards.

14. Nelson.

15. §16.40.230.

16. Telephone surveys were conducted on August 16, 1995, with the Hackney Division of the Boston Police Department, the mayor's office of Indianapolis, the Public Vehicles Department of the city of Cincinnati, and the Colorado Public Utilities Commission.

17. Figures from A. Webster, E. Weiner, and J. Wells, "The Role of the Taxicab in Urban Transportation," U.S. Department of Transportation, December 1974. Dollar figure converted to 1992 dollars using the Implicit Price Deflator for the second quarter of 1992 as supplied by the U.S. Department of Commerce.

18. Press release by Release issued by Centers for Discease Control and Prevention, "Homicide in the Workplace," December 5, 1993, p. 1, discussing National Institute for Occupational Safety and Health study.

19. Cathy Kiyomura, Oregonian, "Taxi Reform Meter Is Running," Wednesday, March 1, 1995, pg. B1.

20. The New York Times, December 6, 1992, p. 49.

21. Gorman Gilbert and Robert E. Samuels, The Taxicab: An Urban Transportation Survivor, The University of North Carolina Press, 1982, p. 149.

22. Mark W. Frankena and Paul A. Pautler, An Economic Analysis of Taxicab Regulation, Federal Trade Commission Bureau of Economics Staff Report, May 1984, p. 75.

23. Id. at 79.

24. Id. at 76 & 77. In fact, New York first attempted to limit the number of taxicabs in 1932 "under the sponsorship of Mayor Jimmy Walker, but when Walker was forced to resign when it was discovered that he had been bribed by one of the taxi companies, the attempt failed." Gilbert and Samuels, p. 70.

25. Ross D. Eckert, "The Los Angeles Taxi Monopoly: An Economic Inquiry," 43 Southern California Law Review, 1970, pp. 422-424; also E.W. Kitch, M. Isaacson and D. Kasper, "The Regulation of Taxicabs in Chicago," 14 Journal of Law and Economics, October 1971, pp. 285-350.

26. Frankena and Pautler, p. 16, citing study by Shaw, et al., Taxicab Regulation in U.S. Cities, U.S. Department of Transportation, Report No. UMTA-NC-11-0011, October 1983, pp. 29- 32.

27. Id. at 65, 155.

28. See Frankena and Pautler; Ross D. Eckert; A. Webster, et al.; David J. Williams, "Information and Price Determination in Taxi Markets," Quarterly Review of Economics and Business 20(4), Winter 1980, pp. 36-43; and testimony of FTC economists William C. Macleod, Richard O. Zerbe, and John M. Peterson before Chicago and Seattle City Councils, 1984.

29. Cathy Kiyomura, Oregonian, "Taxi Reform Meter Is Running," Wednesday, March 1, 1995, pg. B1.

30. Oregonian, "Taxi Safety Affected by High Leases That Use Up Money For Cab Upkeep," Tuesday, February 28, 1995, pg. B6.

31. Id.

32. Id.

33. Nelson and Hamilton, pg. 13.

34. Id.

35. Clint Bolick, Unfinished Business, Pacific Research Institute for Public Policy, 1990, pp. 74-75, and Clint Bolick, Changing Course, Civil Rights at the Crossroads, Transaction, Inc., 1988, pp. 94-95.

36. Allred, Saltzman, and Rosenbloom, "Factors Affecting the Use of Taxicabs by Lower Income Groups," Transportation Research Record, Number 688, 1978, p. 23.

37. Frankena and Pautler, p. 7.

38. §16.40.120 - 004, revising the exemption for "luxury transportation services."

39. Janet Novack, "Regulation at its Worst," Forbes, July 11, 1988, p. 48.

40. Nelson and Hamilton, pg. 4.

41. Id., pg. 7.

42. Id., pg. 11.

43. Id.

44. Rocky Mountain News, "Slaying the Taxi Monopoly," February 2, 1993.

45. Kirby, R.F., "Innovations in the Regulation and Operation of Taxicabs," in Taxicab Innovations: Services and Regulations, U.S. Department of Transportation, May 1980. Kirby et al. (1974, p. 284)

46. The Cincinnati Enquirer, "Hailing cabs: City regulation blocks the road to slice of the American dream," January 18, 1995.

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