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Does The Public Need To Be Protected Regarding Taxis?


The Buffalo Common Council has a Taxicab Committee and the City Code has 12 pages devoted to the regulation of taxicabs. The City Council actually decides and must approve  taxicab rates. In addition to approving rates, the Council controls how many taxicab licenses can be issued by limiting the number of taxicabs to 300 in the City of Buffalo. According to the City Code, years ago after months of discussions, public hearings and investigation it was concluded that the operation of taxicabs “must be regulated to protect the interests of the public”. The City Code has regulations limiting how much you can charge as a taxi driver and how old of a vehicle you can drive. 

The issue of the need to protect the public is being raised regarding a company called Lyft. Started in San Francisco a few years ago, Lyft is a private company operating in 60 cities that allows people through a mobile phone app in need of a ride to connect with drivers. Getting a ride through Lyft generally costs about 30% less than a taxi. Lyft has 100,000 registered users that rave about the service they receive. Drivers for Lyft are independent contractors, many of whom work part-time. To become a Lyft driver the company claims that individuals must undergo a background check. Insurance is required and Lyft provides supplemental insurance to drivers for additional protection.

As stated on Wkipedia, Lyft works as follows:

To request a Lyft car, riders must download the Lyft app to their iPhone or Android-based phone, sign in through Facebook Connect, and enter a valid phone number and credit card details. When a passenger wants a ride, he or she opens the app and sees a map displaying the locations of the nearest Lyft drivers. After tapping to request a ride, the app shows the driver’s name, his or her rating by past passengers, and photos of the driver and their car. Next, the Lyft driver will arrive and likely greet the passenger with a welcoming fistbump. After the ride is complete, payment is made through the app. The requested payment includes a pickup fee and a ride fee based on time and distance. The cost per mile and cost per minute vary by city, with a $5 minimum and a $5 cancellation fee. The passenger can increase or decrease the dollar amount by tapping a virtual pencil to edit the donation. The company takes a 20% cut of the fare. Finally, a passenger must rate the driver before he or she can request another Lyft. Drivers also rate passengers to help prevent abusive or unruly passengers, which increases driver safety.

Existing Taxicab companies do not like Lyft and their lower priced service. City Councilmember Joseph Golombek chair of the Council’s Taxicab Committee has requested that the City Law Department send a “cease and desist” letter to Lyft and two other companies, banning them from operating in the City of Buffalo until they comply with state and local “driver for hire” laws and insurance requirements. Taxi owners and city officials have expressed concern that citizens are at risk by accepting rides through Lyft. Other cities such as St. Louis and Kansas City are also seeking to stop Lyft from operating. Missouri Lt. Governor Peter Kinder wrote an interesting op-ed piece in support of Lyft and providing people the freedom to choose whatever service they desire.

Indianapolis a few years ago deregulated the operation of Taxicabs and saw 32 new companies emerge within the first six months after deregulation, 75% of which were owned by minorities and women. Wait time was cut in half and rates were lowered when Indianapolis stopped limiting the number of taxi licenses. Minneapolis removed the limit to their taxi licenses and won a court fight that was filed by taxicab companies seeking to keep the limit in place. A number of new entrepreneurs have surfaced since Minneapolis opened up their taxicab market.

All of which raises these questions:

– Should city government be involved with regulating the number of taxis that can operate in the city?

– Should city government be deciding taxi rates?

– Should taxis be regulated at all?

– What do you think about Lyft and how should city officials address their operation?

  • Corey Mohr

    It’s really a shame to see government railing against businesses like Lyft and AirBnB – all peer-to-peer services that help struggling individuals get a leg up – and that lower the barrier of entry for potential entrepreneurs. Government should be fostering this type of growth while ensuring there are proper protections in place. Safety and innovation are not mutually exclusive, so why do we see so many governments pounce on their potential creative local economies? Overregulating to the point of deciding how many taxis are allowed (I’d like to see the recent study that shows 300 taxis are the optimal number for current demand in the City of Buffalo), ensures that competition and innovation will have no place in reinventing this industry (or any other for that matter). And I for one, as a Buffalonian who choses not to own a car, am sick of riding in filthy, old Liberty City cabs with grumpy drivers munching on their cheese puffs. How about we regulate that?

  • Charley_Tarr

    Here is the video link for the recent Community Development
    meeting of the Council at which the local Owners and Drivers first raised the

    In all, this appears to be a profoundly risky profit model masquerading as electronic ‘innovation.’ Regardless of anyone’s personal political posture on ‘regulations’ in
    society, the Owners and Drivers framed a very strong argument against this
    ride-share-for-profit [‘contribution’] format.

    Highlights included a Council intern applying to be a driver and receiving electronic approval within 6-minutes. It was further identified that the ‘Legal’ disclosure for one of the companies (contained in the online application within a seemingly endless micro-scroll screen) ‘Control-P’ printed to approximately 70-pages of disconnect for liability.
    This is a clear indication that at least the company attorneys understand the severity of the local permit and insurance regulations being violated.

    I wrote to ask U.S. Dept. of Education to review the focus on college campuses, further requesting a national issuance of warning to Deans of Students as the clear lack of competent background checks creates a very serious platform for predatory crime.

    Speaking of US Dept. of Ed, my own comments seeking a unified SUNY Town & Gown solution in Buffalo commence at the 1-hour mark of the video. I plan to return Tuesday and address that topic further. The federal web page devoted to the investigation authored in 2010 is located at the following URL:

  • Lamont Cranston

    If you don’t think taxis should be regulated, feel free to take one of the gypsy cabs you can find at Tops or Wegmans. Of course, perhaps you enjoy getting in a cab and finding out the driver is some sort of narcotic addict once he starts aiming for parked cars and nodding off in intersections.

  • Da Gelakeiwicz

    “All you have to do is download the app… put in your credit card…” BUT just ignore the part on the app that says you have to waive liablilty – it’s not important, just trivial legalese – no one reads the fine print anyway…

    I’m starting two new apps.

    One is for an escort service. I won’t really be a PIMP, just a technology company matching demand with illegal service providers. #BallinLikeUBER-TRAVIS

    The other is for restaurant delivery. The food will be really cheap and the restaurants won’t be subject to silly govt regulations or health inspections because…
    wait for it…
    you’ll be ordering through your app and the rules will not apply.

    Who cares is someone gets sick or diseased, I won’t have any liability because you waived it when you signed up.

    It all makes sense – if you order through an app – no laws need be followed

  • Dirk Diglerowski

    Dear Paul,

    I’m glad you have written about this subject because the truth needs to come out. The issue that is going on in Buffalo is not a “buffalo” issue ….this is a nationwide problem that is occurring in every city & every state. Companies like Lyft and Uber sidestep the current laws that are in place and operate illegally by having their Lyft drivers perform services like a taxi in their personal vehicles, with their personal insurance and regular passenger plates. In New York state, in every city this practice is illegal because to transport passengers for $ you are required to have:

    *Class E Drivers License

    * For-Hire Insurance if you are compensated directly or indirectly

    * You must have Livery, Taxi, Bus or TLC plates.

    These drivers have none of this. They operate with a personal insurance policy that can be canceled by a carrier if they find out the vehicle is used as a commercial for hire vehicle. Lyft does have a 1 Million dollar contingency insurance policy but is this policy legal in New york state? Regardless…Lyft drivers and passengers are taking a gamble . If you want to research lyft and the battles they have had nationwide I recommend you read up on this subject..

    The City Of Buffalo is not looking for a “money grab” or trying to restrict business. What they are trying to do is enforce the rules , laws they have in place to regulate transportation. They also are enforcing NY State DMV rules. These rules are intended to keep our roads safe. If you disagree with them you have the same rights I do to reach out to our politicians and have these laws changed. Sometimes Government goes overboard…but in this situation I don’t feel they are.

    Heres an interesting article regarding Nebraska DMV issuing a warning:


  • Dirk Diglerowski
  • pitbullstew


    Unacceptable and Unnecessary Exposure to Adversary

    Dear Travel Manager:

    When you arrange transportation for a client,
    employee, visitor

    or family members of any of those, you not only have
    an implied

    obligation to perform due diligence in selecting the
    service, but

    a direct and specific obligation and responsibility
    for their safety.

    That Town Car transporting your people is in fact an
    agent of your

    corporation acting on behalf of and at the direction
    of your department.

    Anything and everything that may happen will be your
    complete and

    total liability and responsibility.

    When you sign a contract with UBER, you specifically

    that UBER accepts no liability or responsibility for
    anything that

    happens, and further that the transportation arranged
    may be in a

    vehicle that is unlicensed, unsafe or unsuitable for
    the transportation

    of children. (Exact words)

    Exposure to Risk 1) Let’s say you have a visitor, a
    high-level attractive

    female executive from a company whose account you are
    eager to secure.

    This is an actual account of a woman’s experience of
    being raped by

    an UBER driver: (Want him to drive for your

    Uber Driver Arrested For Rape: Anouar Habib Trabelsi Arrested, Not
    Charged With Sexual Assault Of Female Passenger In Washingt

    Exposure to
    Risk 2) An UBER Town Car transporting your employee

    on an official company trip to make a presentation is
    involved in a

    fatal accident en route, similar to the one below,
    (Scroll down) where

    a six year old girl was run over and killed by an UBER
    driver and her

    mother was grievously injured and has needed several

    Her medical bills so far exceed

    UBER’s insurance has proven to be ineffective at best
    and evasive

    and worthless in several instances. The attorneys for
    the families of

    the people killed will not waste much time in
    discovery determining

    who was leasing the car and directing it at the time
    of the accident.

    If that happened to be your corporation, you will
    experience some

    enormous bad publicity and a huge settlement that goes
    to the favor

    of the people injured and killed by YOUR CHOICE of


    First, let’s look at the advantages of using an
    established, licensed

    Limousine Service instead of a freelance UBER person
    using his

    family car or SUV to make beer money on the

    1) Insurance. Limousine companies are required by law
    to have

    first-dollar coverage and be in effect

    You can have your company listed as an additional
    insured on

    these policies. (Impossible with

    2) Chauffeur Background Checks. Again, by law, all
    chauffeurs and

    drivers for regular licensed services have mandatory
    and regular

    drug tests, fingerprints and full
    FBI background checks.

    (UBER does none of that)

    3) Distracted Driving. Professional chauffeurs know
    the city and know

    where they are going before they pick you up. An UBER
    driver is always

    watching his UBER smartphone screen and his GPS
    instead of the road.

    4) Hours of Service. Is your UBER driver nodding off
    from lack of sleep?

    UBER has no oversight of its contracted vehicles in
    the field. Again,

    regular licensed services are regulated by law and
    their drivers can

    only work a
    certain number of hours per day.

    5) Licensed Chauffeurs. Licensed companies are
    required by law to have

    chauffeurs get Chauffeur Licenses and/or Commercial
    Driver Licenses

    (CDL’s). UBER’s only requirement is a plain vanilla
    basic driver’s license.

    Again, did YOU perform due diligence in selecting safe

    for the people you are responsible

    READ MORE: This stuff is real

    6. The UBER Insurance Umbrella

    Uber, on behalf of UberX, has conducted
    a major media blitz claiming an umbrella insurance coverage that drops down to
    cover drivers and/or passengers in the event of an accident when the TNA
    operator’s insurance carrier denies coverage. Uber has labeled this coverage as
    the best in the industry. Uber fought public release of all but the most
    elemental provisions of this supposed elaborate and generous coverage, and then
    only under cloaks of secrecy to select public officials. However,

    search of the literature turned up dire warnings to the public about the
    reliability of such policies. Indeed, the noted local legal scholar, Gail S.
    Kelley, pointed out in a July, 2013 article in Structural Engineering Magazine
    that the drop down coverage of an Umbrella policy was generally denied when the
    underlying insured failed to comply with the provisions of the underlying
    policy. This is exactly why coverage was being denied for the private vehicles
    being used in livery services. And Regulators from both the California and Ohio
    had issued stern warnings of gaps in liability coverage by the drop downs of the
    Umbrella policies carried by the likes of Uber and Lyft.

    shroud of secrecy was lifted when an anonymous source sent the San Francisco Bay
    Guardian a copy of the Uber Umbrella policy issued by James River Insurance
    Company (JRI). The S F B Guardian immediately published this copy of the Uber
    policy on the web for public viewing. Some of the early comments were of
    interest. Ohio Insurance Director Mary Taylor stated in a consumer alert issued
    on April 16th that “While TNC’s may provide liability
    insurance, they may not provide medical payments coverage, comprehensive,
    collision, uninsured and underinsured motorists coverage, or other types of
    coverage to fully protect the TNC drivers and passengers”. Amy Bogner, a
    spokesperson for the Florida Office of Insurance Regulation, issued concerns
    stating “We are looking at solvency of companies –
    if they have enough surplus to pay out claims”.
    Finally, John Madiedo, president of the Professional Insurance
    Center in Tampa, pointed out that the supposed Uber Umbrella policy was secured
    through a series of shell corporations, all with the first name of Rasier, none
    of which had any assets and none of which had contracts with any of the Uber
    drivers. According to Madiedo, “Rasier doesn’t do anything: it has no
    drivers … It’s a ring around the rosie”. (See “Some Doubt Ride-Sharing
    has it Covered Liability Wise” by Mike Salinero, Tampa Tribune, April 20, 2014).
    JRI is frequently referenced in the Financial Media as a

    to published media reports, Uber is moving quickly to fill gaps in the alleged
    deficient policy it has so publicly touted as the best in the industry. Based
    upon the above warnings, most notably those published by Salinero, a cursory
    review was conducted of the published Financial Statements of James River
    Insurance Company (JRI), and the policy issued to the Rasier, LLC’s on behalf of
    Uber. While these comments are neither definitive nor exhaustive, they should
    shed light on exactly how the public may have been misled by Uber.

    JRI is a
    Commercial Excess Casualty Insurer with a home address in Richmond, Virginia. As
    a casualty insurer, JRI is not authorized to issue insurance on private
    non-commercial vehicles. JRI is privately held by the offshore Bermuda
    Corporation, 055488 Franklin Holdings. Offshore Corporations are often known for
    being difficult to attach assets in the event of a dispute.

    JRI had
    total assets at EOY 2013 of a mere $470.2 million. In comparison Geico, who is
    authorized to issue insurance policies on private, non-commercial vehicles, had
    total assets at EOY 2013 in excess of $28 billion. JRI had a credit rating
    issued by Best of A- compared to that of A++ for Geico. While this may appear to
    be a comparison of apples and oranges, one is reminded that Geico is nothing
    more than our little home grown company located out on Western

    Casualty Insurer, JRI’s primary revenue source is expected to be insurance
    premiums. In 2013 JRI wrote $35.9 million in insurance premiums. This is down
    from $41.5 million written in 2012, a decline of 18% in one

    The Web
    published copy of the policy issued on behalf of Uber by JRI had the premium
    amount blackened out. However, an examination of the detailed schedules to the
    JRI financials sheds some interesting parameters on what that policy appears to
    have cost Uber. In 2013 JRI had premiums written of $568,669.00 for “Commercial
    Auto Liability”. In 2013 JRI further wrote premiums of $2,924.00 for a
    commercial category “Auto Physical Damage”. This is a combined total of
    commercial auto premiums written for JRI of $571, 593.00 for the year 2013. No
    premiums were written for any category of auto coverage by JRI in

    It may be
    reasonable to infer, given that the issuance of a Commercial Auto Insurance
    Policy by JRI is new to JRI in 2013, and that the Uber policy was priced at an
    upper limited of $571,593.00 dollars. In order to understand the absurdity of
    such a minimal premium, this premium would cover the total premiums on DC’s
    estimated fleet of 7,000 taxicabs for little more than two weeks. UberX is
    alleged to have had 7,000 vehicles in operation in the Metro area at the end of
    2013 and currently an estimated 10,000 vehicles. Nationwide, it would be
    reasonable to infer that Uber now dispatches an estimated 45,000 UberX vehicles.
    At DC Taxicab insurance rates, an annual premium of $571,593.00 would provide
    coverage for the nationwide Uber fleet for about 3 days, not a full

    attempting to read an insurance policy is like swatting at bats in the dark with
    bare hands, a couple of interesting curiosities did emerge. First, the Uber policy drop down
    is not a million dollar drop down. The drop down is $50K for an individual with
    a total of $100K per incident for bodily injury; and a $25K per incident for
    property damage. This carries a $1,000.00 deductible. Second, JRI will pay only after
    the liability limits under any liability bonds or policies have been exhausted
    by payments of judgments or settlements. This appears to suggest that any party
    processing a claim has a long road to travel before they can access the JRI
    coverage. Third, any judgment
    for damages arising out of a ‘suit’ brought without JRI’s written consent is not
    binding on JRI. A plain language reading of this suggests that to seek recovery
    of damages against JRI, you have to have JRI’s written consent to sue JRI. How
    convenient. Fourth, any suit
    brought must be served on the Company Attorney in Sacramento California. How
    convenient for the residents of the District of Columbia.

    It is
    difficult to conclude that the fantastic Uber Umbrella drop down policy is
    anything more than a sham. Similarly, the Lyft and Sidecar policies need to be
    made available to the public and subjected to public scrutiny. In any event,
    none of these policies should serve as a starting point for mandating insurance
    coverage applicable to any ‘for hire’ vehicles permitted to operate on the
    public roadways of The District of Columbia.


    The Situation in Illinois:

    Very few of the Illinois Senators bought or even understood why Uber, Lyft
    and Sidecar didn’t want coverage when someone was essentially working ” app on
    “to ” app off”. The California situation with the Uber defense in the little
    girl”s case was not appreciated. Also, no one understands why these guys don’t
    want drug testing.The safety issue trumps all in our fight. Even the
    Libertarians agreed on the safety issues. After all everyone is worried about
    their kids in these cars. The legitimacy of the Uber insurance policy was
    brought into play. First because of the waivers everyone signs and then because
    the James River annual report for 2013 points out that they took in only 2.5
    million in premiums for commercial cars which is very strange given that these
    guys have over 60,000 cars on the road or around $41.00 per year for insurance
    premiums.The same report also pointed out that James River paid out only $33,000
    dollars in settlements in 2013. If the policy is like any other and has real
    coverage these numbers would not be anywhere near the coverage results. In
    Chicago alone, for 6800 taxis the Insurers pay out around $30,000 per
    day.So something is clearly wrong with this policy.

    In any event, I am at 239 514 7329

    Pat Corrigan

    Yellow Group





    There are several points of law that need to be
    looked at in the wake of

    the tragic accident on New Year’s Eve when six year
    old Sophia Liu was killed by a negligent UBER driver who has since been indicted
    on Felony Manslaughter by

    Auto charges.

    official statement:


    Memorial Fund details


    UBER says they are not liable for the fatal
    accident because they didn’t have

    a paying client in the back seat at the

    This is like “Cracker Jack Box” Pizza
    delivery insurance. Little or no liability.

    (More on this later).

    In actuality, UBER has no insurance. The
    California PUC ordered them to have one million per incident, but UBER has
    “Appealed” the decision.

    Here’s the deal: Limo Operators found out
    the hard way on a Department of Labor ruling that if a chauffeur takes a Town
    Car home in order to do an early morning run, if he is “Subject to doing a job”
    then he is on the clock and must be paid overtime and be subject to Hours of
    Service for CDL drivers and/or crossing a State Line.

    So, using this legal precedent, any UBER
    driver is “Subject to doing a job” by

    virtue of being in permanent possession of
    an UBER-Issued phone. UBER needs to have (Like the rest of us) 24/7/365 Active
    Insurance OVER AND ABOVE any insurance the car and driver may

    If any California operators know a good
    Personal Injury attorney, they should refer them to the Liu family. Uber has a
    net worth of $4 billion and posted an after-tax net income of $275 million last
    year, a very sweet plum ripe for the plucking.


    Uber says they “Have a zero tolerance
    policy on drugs” and that “Our drivers are thoroughly background checked before
    we hire them”.


    In the article below, it is factually
    documented that UBER Driver Daveea Whitmire was a convicted felon and had done
    in time in prison for being a drug dealer and had a long rap sheet. It went on
    to say that former California regulators were appalled that UBER was allowed to
    use Hirease for a $15 one-click criminal background check instead of the full
    FBI/DOJ Livescan with fingerprints and NCIC checks.

    Under the loosely-written California PUC
    Regulations, UBER could even do an in-house one phone call to the sheriff. The
    California PUC regulations on UBER are like letting the fox guard the
    henhouse. Anything goes. Neither UBER nor Lyft have ever drug tested or
    fingerprinted a single driver anywhere in the USA.

    Take the time to read this article. It will
    dispel any delusions you may have about

    UBER’s “Thorough background


    UBER says “We are just an APP and not liable for
    the actions of our drivers”

    Not so. In the following article in FORBES
    magazine, it is pointed out that Dominos Pizza lost a $32 million dollar lawsuit
    when a pizza delivery boy hit a car and killed the wife of a man and permanently
    disabled the husband. The jury decided that the pizza delivery boy was driving
    excessively fast to stay in compliance with the national chain order of “All
    pizzas must be delivered in 30 minutes”. UBER drivers must arrive precisely when
    Google Maps says they “Could” not taking into account weather or construction
    delays. Drive fast or get a bad review. Exact same legal precedent. Read the
    article, get educated.


    California Texting While Driving

    The driver in the fatal accident may well have
    been texting UBER at time he killed Sophia Liu. Real Limousine Chauffeurs go
    from job to job with full knowledge ahead of time from their dispatcher. UBER
    drivers drive aimlessly around belching emissions and clogging traffic while
    waiting for a “Ping” from UBER and then their eyes are glued to the phone while
    they compete for the run while they are zooming down the Ventura Freeway. Was he
    texting UBER? In your lifetime you will never know as everything UBER does is
    highly encrypted and no one in authority in California has the cojones to ask to
    see the records. Bad, bad, bad.



    UBER’s Travis Kalanick is a known lawbreaker and
    tax evader so it would make sense he would claim all drivers as Independent
    Contractors. He also gets to ignore FICA, witholding, Obamacare, Workers Comp,
    Hours of Service, etc, etc.

    Could all his drivers pass the 21-Point IRS
    Independent Contractor smell test? I don’t think so. If you go a whole year and
    work only for one person, you are an employee. UBER specifies
    appearance, behavior and service levels and that
    is micromanagement. UBER is even “Arranging” for drivers to buy cars from them.
    FEDEX Ground found out the hard way about that

    Why does USDOT, USDOJ, IRS, FMCSA, FTC all give
    UBER a “Get out of jail free card”? Does anybody but me smell a


    UBER: “We are not a transportation Service, we
    are just an APP on a telephone”

    Well, let’s see:

    1) UBER inspects

    2) UBER runs (Sort of) background checks on

    3) UBER specifies level of service, appearance
    and behavior

    4) UBER advertises for

    5) UBER collects the money and pays the

    6) UBER dispatches specific vehicles and
    designates routes

    7) UBER fires drivers for bad service (Or trying
    to organize or complain)

    Seems like Danny DeVito did all this during the
    TV Show “Taxi” in the 70’s.

    That was a transportation company. How is UBER
    any different?


    In the wake of the terrible tragedy of UBER’s
    killing of a six year old girl, UBER CEO and multi-millionaire Travis Kalanick
    loudly denies any responsibility whatsoever even as the police report at the
    scene is still being written on the clip board.

    ARE THERE ANY WOMEN in Travis Kalanick’s life?
    Apparently not. Most of the mothers, wives, sisters and daughters I know would
    be slapping his face so hard he would be knocked across the room while they
    demanded he stand up and act like a man and take responsibility for this
    grotesque monstrosity of a transportation service he built that resulted in the
    death of a six year old girl.

    Travis Kalanick is the poster child for all that
    is wrong with corporate America.

    Greed, corruption, bribing of public officials,
    falsifying public documents, lying to Federal Agents, egregious abrogation of
    responsibility, he operates as an incorrigible reprobate in a pervasive moral
    and ethical vacuum. Need another example of the completely socially
    irresponsible scum that UBER is? Neither UBER nor Lyft have even one wheelchair
    accessible vehicle anywhere in the USA.

    I encourage you to go see the movie “Wolf of
    Wall Street”, based on actual events.

    When you see the main character Jordan Belfort
    (His real name) lying, cheating and stealing, you can blink your eyes and see
    Travis Kalanick. There were scenes

    of wild parties at the stockbroker’s office. Go
    to UBER’s Facebook page and see

    his employees dancing the “Baker” at UBER HQ in
    San Francisco. Life imitates art.

    FINALLY, The Biggest Understatement of 2014 (So

    UBER, Lyft and Sidecar need more regulation

    Hope all this has been helpful. Please
    share with all your limo buddies and any

    regulators who have not been bought off yet.
    Getting UBER in your marketing area is like getting Aids, Herpes, Malaria or