OWNER DRIVER MUST RIDE RULE & REQUIRED SHIFT HOURS

These rules make six important changes to the Taxi and Limousine Commission's owner-must-drive requirements.

Background

The Taxi and Limousine Commission's existing rules require that some owners of independent taxicab medallions who bought their medallions after January 6, 1990 must drive their taxicabs. These owners must drive their taxicabs a minimum of 210 nine-hour shifts per year. The current rules also specify that one owner must fulfill the entire driving requirement, even if ownership is shared by more than one person. This rule is known as the "owner-must-drive" requirement.

The purpose of the owner-must-drive requirement is to promote safety and good customer service. The TLC believes that taxicab drivers who own a medallion will operate the medallion more responsibly than those who do not because of the substantial financial stake an owner/driver has in the taxicab medallion. Studies have shown that owner-driven taxicabs have fewer accidents, fewer violations of rules, and higher vehicle inspection pass rates.

Electronic trip records from the taxicab technology system show widespread non-compliance with the owner-must-drive requirement. Industry advocates contend that the requirement is difficult for many owners to fulfill. In particular, under the current rule, a long-time owner-driver who wishes to retire or to reduce his or her work schedule must either sell the medallion or violate the owner-must-drive rules. Sale of a medallion can trigger capital gains taxes that may exceed the driver's equity in the medallion.

In November 2010, the Metropolitan Taxicab Board of Trade, the Committee for Taxi Safety, and the League of Mutual Taxicab Owners petitioned the TLC to relax the owner- must-drive requirements. This rule is the result of discussions between the TLC and those groups about the issues raised in their petition. The TLC's overriding policy goal is to give independent owners a reasonable degree of flexibility while preserving the advantages of owner-driven taxicabs.

Rule Changes

1. Reduces the existing driving requirement for all owner-must-drive medallions from 210 nine-hour shifts per year to 180.
   
   
   
2. Allows individual owners who are at least 62 years old and have driven for at least 10 years to reduce their work schedule to 150 seven-hour shifts per year.
   
   
   
3. Ends the requirement that one owner must satisfy the entire driving requirement and allows driving duties to be divided among up to four owner-drivers, provided that each owns at least 10 percent of the medallion.
   
   
   
4. Creates an alternative service option for many owners. This option permits an owner to stop driving completely while providing that the medallion is driven by a driver with a stake in the vehicle and a commitment to the industry. An owner must meet all of the following to take this option:
   
   
   
   • Current owners must have owned for at least two years. Future owners must own and drive for at least ten years. An owner must lease the medallion to a driver who either owns the taxicab vehicle or leases it with a conditional purchase agreement.
     
     
     
   • The driver must drive the vehicle an average of at least 120 hours per month. The driver must drive at least 180 nine-hour shifts every calendar year. The owner must sign up for the option for a calendar year before that calendar year begins. The owner must pay a $5,000 penalty for each calendar year or $2,500 for owners 62 and over.
     
     
     
     
5. As noted above, TLC records show that many owners have not complied with the owner-must-drive requirement under the current rule. Because of this, the rule:
   
   
   
   • substantially increases the penalties to ensure compliance with the more relaxed requirements by establishing a range of fines from $1,000 to $10,000 based on shifts missed, and
     
     
     
   • adds penalties for agents who do not comply with owner-must-drive requirements for medallions that they manage by establishing a range of fines from $1,000 to $10,000 per medallion and/or suspension until compliance.
     
     
     
     
6. Finally, this rule permits an owner who buys an independent medallion together with a vehicle previously hacked-up with that medallion to continue to use that vehicle until its scheduled retirement date.
   

Photo: Elena Michaels

Following Are Highlights of the New Rule Changes

Special Rule for inheriting spouses

A spouse inheriting an Independent Medallion from the sole Owner of that Medallion will not be required to meet the Owner-Must- Drive requirement for 180 days following the Owner's death.

A. After 180 days

(1) the inheriting spouse is subject to the same requirement the deceased Owner was subject to, that is, 180 nine hour shifts or 150 seven hour shifts if the deceased Owner was required to drive.

(2) the inheriting spouse is subject to the 180 nine hour shift requirement initially if the deceased Owner was not required to drive because the deceased Owner acquired the Medallion before January 7, 1990.

B. For purposes of determining compliance with the Owner-Must-Drive requirements, those requirements will be pro-rated on a monthly basis in any applicable calendar years to account for the 180 days for which compliance is excused.

Independent Driver Option: Special Rule for Medallions Leased to Independent Medallion Drivers

An Owner does not have to personally drive the minimum number of shifts and hours of operation for an Independent Medallion Owner as set forth in Section 58-20(a)(3)(i) of this Chapter if all of the requirements of this Section 58-20(a)(4) are met:

A. An Owner of an Independent Medallion who acquired the Medallion before July 1, 2011 must own the Medallion for at least two years before being able to be excused from the driving requirement under the Independent Driver Option.

B. An Owner of an Independent Medallion who acquires the Medallion on or after July 1, 2011, must own the Medallion for at least ten years and must meet the driving requirements of Section 58-20(a)(3) during those ten years before being able to be excused from the driving requirement under the Independent Driver Option.

Driving History

1. The Chairperson will use records generated by the Taxicab Technology System to determine whether an Owner has met the Owner-Must-Drive requirements.
   
   
   
2. For periods before the Taxicab Technology System was operating the Chairperson will assume that the Owner met the Owner-Must-Drive requirements unless the Commission's licensing or adjudication records show that the requirement was not met.
   

Service must be provided by Independent Medallion Driver

A. An Independent Medallion Driver designated by the Owner must operate the Taxicab at least 180 nine-hour shifts in each calendar year.

B. A Driver is an Independent Medallion Driver if the Driver meets all of the following as to the Owner's Medallion:

1. The Driver drives the Taxicab an average of at least 120 hours per month;
   
   
2. The Driver is either:
   
   i. the title owner of the Taxicab vehicle or
   
   ii. the lessee of the Taxicab vehicle and the vehicle lease has a conditional purchase agreement for the vehicle; and
   
   
   
3. The Driver is not an Independent Medallion Driver for any other Independent Medallion.
   

Penalty

A. An Owner who provides the service required by section 58-20(a)(3) by electing to use the Independent Driver Option will pay a penalty each calendar year for failing to provide service personally. The penalty the Owner will pay is $5,000, unless the Owner is 62 or older at the time of election, in which case the penalty is $2,500.

Designating the Driver

A. The Owner must designate the Independent Medallion Driver who will provide the 180 nine-hour shifts before an Owner can receive the benefit of this section 58-20(a)(4).

B. The Owner must designate the Independent Medallion Driver on a form specified by the Commission. An Owner will designate another Independent Medallion Driver by revoking the prior designation and filing a new designation.

C. Only one designation can be in effect for any Independent Medallion at any time and there can be only one Independent Medallion Driver for any Independent Medallion at any time.

D. An Owner can change the designated Independent Medallion Driver only one time each calendar year.

E. An Owner can designate no more than two Independent Medallion Drivers for any Independent Medallion in any one calendar year.

F. An Owner must immediately report to the Commission when the Owner has terminated or changed a designation or when a Driver ceases to be an Independent Medallion Driver for the Independent Medallion.

Waivers

Upon written request by an Owner, the [Commission] Chairperson can waive or modify the requirements of the Owner-Must-Drive rule [for a limited time, for good cause shown].

(i) The Chairperson can grant waivers for up to six months, and can grant extensions of those waivers for up to an additional six months.

(ii) The Chairperson will require an Owner to provide documentation for any requested waiver. Failure to
provide required documentation will result in denial of the request for a waiver.

(iii) The Chairperson will grant waivers only for the following reasons and only after considering documentation:

A. Medical reasons.

B. Non-vacation travel for family or business reasons.

C. U.S. military service.

(iv) Waivers will result in a pro-rata reduction in the driving requirement in the calendar years applicable.

Example: A two month waiver will reduce the Owner-Must-Drive service requirement to 150 shifts in the calendar year granted.

For a complete review of the Owner must Drive Rule see:

Section 58-03 of Chapter 58 of Title 35 of the Rules of the City of New York

http://www.nyc.gov/html/tlc/downloads/pdf/owner_must_drive_version_10.pdf

Photo: Elena Michaels

DRIVER HACK LICENSE RENEWAL PROCEDURES

Mike Delgado, Medallion Maintenance • Long Island City, NY

The following step by step driver hack license renewal procedures has been prepared by Mike Delgado, Medallion Maintenance, Long Island City.

1. The TLC licensing division has started to mail out driver renewal applications approximately 90 days before the driver's license expiration date.
   
   
   
2. The TLC renewal application package details all of the compliance requirements. The driver needs to read the instructions carefully and complete all his renewal compliances (drug test, ddc- defensive driving course, pay open fines, etc).
   
   
   
3. As soon as the driver receives his renewal package from the TLC, he should call Lab Corp. (1-800-923-2624) to schedule his drug test. Lab Corp. will give him an appointment date within 30 days of his license expiring. He must show up!
   
   
   
4. If the driver does not mail his renewal paperwork to the TLC lock box (post box delivery address) in time for it to be received - at least 31 days before his license expiration date - he will also have to send a $25 late fee check in the envelope in order for the TLC to process his renewal paperwork.
   
   
   
5. Failure to pay the $25 late fee in this mailing will result in his license not being renewed even if the application is complete (drug test, ddc, all fees & fines paid).
   
   
   
6. Drivers should take into consideration postal delivery time and mail their renewal well before the 31 day window. The TLC is using the receipt date at the lock box to determine if an application is timely and on file.
   

EXAMPLE:

• TLC license expires on November 15, 2011
  
  
  
• Driver should mail his completed renewal in time for it to be received at the lock box – a couple of days before October 14, 2011
  
  
  
• If he mails it after October 14, 2011 (31 days), he must include a $25 late fee check in the envelope.
  

Please note:

The TLC will require that a driver start the licensing process all over - including taxi school - if any of the following occur:

1. If he mails an incomplete application and it is not completed by the license expiration date (no ddc, does not pay tickets, no drug test).
   
   
   
2. If his renewal is not received 31 days before his license expires and he does not include a check for the $25 late fee.
   
   
   
3. If the driver does nothing before his license expires.
   

The driver should:

Step 1:

• Pay any and all outstanding fines or fees owed. These include parking tickets, red light tickets, traffic tickets, bus lane tickets or TLC tickets.
  

Step 2:

• Take a defensive driving course if one has not been taken within the last 3 years.
  
  
  
• Get a ddc completion certificate and certify mail it (return receipt requested) with the renewal application paperwork and payment to the TLC lock box.
  

Step 3:

• Call Lab Corp. and schedule a drug test appointment as soon as he receives his renewal paperwork.
  
  
  
• Lab Corp. will give an appointment on a date no more than 30 days before the license expiration date.
  

Step 4 - final:

Mail completed license renewal with payment and all required documents no less than 31 days before license expires and include in the mailing a $25.00 late fee charge if mailed after 31 days.

• If a driver does not receive a renewal package within 60 days of his expiration date he should contact the TLC.
  
  
• If he has moved since he last renewed he should file a change of address form with the TLC.
  

All drivers must know that:

• These outlined procedures are being strictly enforced and administered by the TLC.
  
  
  
• Failure to complete any and all steps detailed above will result in his/her license not being renewed.
  
  
  
• The TLC will not change policy in order to accommodate any late renewal application or make any exceptions.
  

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