Council Agrees To Cabbies’ Request For Rate Hike

OCEAN CITY — Taxi companies won’t be the only ones seeing their costs spike with the proposed medallion system in Ocean City, as the City Council approved the first rate rise for riders in almost four years on Monday night.

At the end of round two of a three-round battle to approve a new ordinance restructuring the taxi industry in Ocean City, it appears that the added costs that have worried cab owners will now become the worry of the consumer as well, as the council approved a 40-cent rate hike to the resort’s taxi meters, perhaps in an effort to help ease the sticker shock of the new and pricey medallions for cab owners.

As both sides continue to debate the ordinance that would require taxi companies to purchase a $1,500-per-car medallion in order to operate a cab business in the resort, the council voted 6-1, with councilwoman Margaret Pillas in opposition, in an ancillary motion to allow for a $3.20 initial fare and a $2.20 charge to be added to the taxi cab fare for every mile traveled.

The new rates add 20 cents to each fare, despite some in the cab industry vehemently arguing that the 40-cent raise needed to go on the “every mile” fare and to leave the initial fare at the existing price of $3.

This is the first time that the town has raised the rates for taxi riders since establishing a metered system in April 2006. Prior to 2006, there were no regulations on what cabs could charge customers.

“People aren’t going to care so much about the rate raise if they are riding in a nice vehicle,” said 73-year-old independent cab owner Ronald Cecil. “They will only complain about the cost if they are riding around in a piece of junk. The real issue is that the cab industry needs better equipment, but if you don’t give us $2.40 a mile, it’s not going to help us cover the costs of these medallions, let alone better our equipment.”

The traditionally tight-knit but uber-competitive cab industry banded together on Monday night, providing the council with a signed petition from many in the taxi hierarchy, calling for a few caveats and easements the ordinance.

“We are respectfully asking you as a group to reconsider the currently proposed medallion fee from $1,500 to $1,000 and to also lower the annual renewal fee for the medallion from $500 to $300,” said Beach Taxi owner Norman Mullinix Jr. “Finally, we’d like you to raise the fare structure 25 cents to $2.25 per mile, which would make it much more feasible for us to operate our businesses.”

It was revealed soon thereafter by Ocean City Police Captain Kevin Kirstein that the meters are only able to be altered in 20-cent increments, thwarting the initial cab request for a 25-cent per mile raise.

Some in the industry were concerned, however, with the public’s potential perception about a rate increase trickling down to the consumer.

“You’ll see that my signature is not on that petition and that is for one reason only,” said OC Taxi owner Carl Kufchak. “I am worried that the headlines are going to read ‘cabbies get a rate increase’ because that might hurt our business, and we want to increase ridership.”

The letter from the cab companies to the council also pointed out that Ocean City has substantially lower cab fares compared to other East Coast resorts such as Virginia Beach ($3.25 initial, $2.40 per mile), Atlantic City ($3.80 initial, $3 per mile), Myrtle Beach ($1.50 initial, $2.80 per mile), and even Rehoboth Beach ($1.90 initial, $2.90 per mile.)

“I’m telling you guys, I’m looking up and down this row and the votes aren’t here for $2.40 a mile,” said Councilman Jim Hall, “but I’m pretty sure you can get $2.20 a mile, so I would advise you taking that because we’ve basically bent over to get the consensus for this, but I think it’s fair for you guys to get a bit of a fare increase.”

Although the council voted through the rate increase, it would not budge on the medallion fee or the annual renewal fee.

“These medallions are essentially you investing in your own business,” said Councilman Doug Cymek. “We aren’t trying to help you subsidize your initial costs with this rate increase, we are trying to help you with your annual costs.”

The council held true to its belief that the installation of a medallion system would create value for cab owners, going so far as to add into the ordinance that the cost of a medallion on March 2, just one day after the scheduled medallion sale, will immediately go from $1,500 to $2,000.

“I can get on board with that”, said Margaret Pillas, “because we keep telling the cab drivers and owners that these medallions are going to increase in value, and now we are showing them that they will the very next day.”

In addition, the council decided to help ease the initial cost of the medallions by extending the time in which to pay for them, and only requiring 10 percent of the total cost on the date of purchase, with another 10 percent due April 15 and 20 percent due each month until final payment on Aug. 15. However, if any cab company misses any of the payments, the medallion will be revoked with no refund.

The council also increased the number of medallions be offered on March 1 from 160 to 175 and altered the ratio of fleet to independent cab owner medallions from 75/25 percent split to 85/15 percent, respectively.