Judge Brings 5-Borough Taxi Plan to a Screeching Halt

A state Supreme Court judge has brought the city’s five-borough taxi plan to a screeching halt.

Acting on a law suit brought by the yellow cab industry, the judge said Friday that allowing the state to approve the plan was “an unconstitutional power grab.”

The plan, set to get underway this month, would have brought street-hail taxi service to northern Manhattan and the outer boroughs. The sale of the additional medallions — essentially, licenses to operate street-hail vehicles — was to bring more than $1 billion to city coffers. 

The city has been offering seminars for fleet owners on how to convert outer-boro livery cars to taxis, and even designated a color for the new street hails –”Apple Green.”

“The court has trouble seeing how the provision of taxi service is a matter that can be wrenched from the hands of city government where it has resided for some 75 years. And be handed over to the state,” wrote Supreme Court Judge Arthur Engron, a taxi driver himself while he was an undergrad at Columbia, in his decision.

He added that the restraining order “seeks to preserve the status quo until a more complete examination of the plaintiffs claim can be made.”

The city’s reaction was swift and scathing.

“We are deeply disappointed by today’s decision," said Corporation Counsel Michael A. Cardozo. "We think the court was mistaken in its analysis and are exploring our appellate options. We intend to so do expeditiously, so that we can proceed with this important new initiative.”

The medallion industry has bitterly fought the Bloomberg plan, hiring consultants, organizing opposition rallies and threatening to litigate. The industry complained that allowing cars other than yellow taxis to pick up street hails would devalue the billion dollar medallion industry because for more than 80 years only they enjoyed that right.

One of the plaintiffs, the fleet group the Metropolitan Taxicab Board of Trade, is celebrating the decision.

“By preventing the Taxi and Limousine Commission from issuing any outer borough street hail permits, the court has prevented a trampling of the New York state constitution as well as an economic disaster from taxi owners and drivers who invested their life savings into what they regarded as the American dream—the taxi medallion,“ said spokesman Michael Woloz.

TLC Commissioner David Yassky called the last minute decision “unfortunate.”

“We share the disappointment of the 80 percent of new Yorkers who live and work outside Manhattan and are waiting for safe, legal and reliable taxi service as well as the thousands of livery drivers who stand ready to provide that service,” Yassky said.

The city was poised to start issuing the permits this month. The yellow medallion auction that’s scheduled for July and is estimated to bring in about $1 billion to the city ‘s budget is now also on hold.