TAXICAB AUTHORITY: Board approves fare increase - Business

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Jun. 24, 2008
Copyright © Las Vegas Review-Journal

TAXICAB AUTHORITY: Board approves fare increase

Passengers to pay extra 45 cents per mile

By HOWARD STUTZ
REVIEW-JOURNAL

Taxicab driver Steven Lenett speaks Monday to the Nevada Taxicab Authority at a meeting on rates. The board unanimously approved two increases, totaling 45 cents a mile.
Photos by Craig L. Moran.

Taxicab Authority Chairwoman Kathryn Werner-Collins said that Las Vegas is not the only city adjusting rates according to fuel costs.

Las Vegas cab passengers will pay an additional 45 cents a mile starting July 6 after the Nevada Taxicab Authority voted unanimously Monday to increase rates in reaction to rising gasoline costs.

The fare boost includes a permanent 20 cents per mile charge and a temporary 25 cents per mile fuel surcharge that could be increased if gasoline prices climb above an average of $5 a gallon.

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The five-member board spent almost two hours listening to drivers, union representatives and taxi company executives on how the rate increase should be implemented. Some drivers argued against any fare increase, believing the higher costs would cut into their tips.

However, most of the speakers said the average cost of a gallon of unleaded gasoline is causing taxicab companies to spend more for fuel and is cutting into drivers' take-home pay. According to Taxicab Authority staff, unleaded gasoline averaged $4.13 a gallon on June 16 and has risen $1.57 a gallon since last September.

Jay Nady, the chief executive officer of A-Cab Co., told the Taxicab Authority board it cost him $30,000 to fill up his fleet of taxis last week. In October, the price to gas up the fleet was $17,000.

"We're in a real crisis, and the (Taxicab Authority) staff put together a very good recommendation," Nady said.

Some speakers worried that prospective cab customers might be scared away by the increased rates and seek other modes of transportation to get around Las Vegas. The Taxicab Authority staff told the board that Las Vegas is not the only city tacking on fuel surcharges at this time.

"Given with what has gone on with the economy, this is appropriate," said Taxicab Authority Chairwoman Kathryn Werner-Collins. "As far as the sticker shock issue, we are not the only jurisdiction looking at rates and fuel costs. We're not the jurisdiction paving the way on this."

Washington, D.C., and St. Louis have both implemented fuel surcharges of 95 cents to $2 per trip, Taxicab Authority staff said. Administrator Gordon Walker said the rate stickers inside taxicabs will show an increase from $2.20 per mile to $2.65 per mile, reflecting both the permanent and temporary charges.

The initial $3.30 fee for hiring a cab will not change, but wait-time charges will rise $2 to $30 an hour.

Steven Lenett, a driver for Whittlesea, said good drivers will continue to make their tips despite any rate increases. He said many customers expect cab fares to go up, similar to what consumers are experiencing with the rising cost of other goods and services during the current tough economic times. "This should be good for the drivers," Lenett said. "Good drivers will make good tips."

Werner-Collins thought most taxicab customers would base a tip on their overall bill.

"I hope for drivers the increase will have a positive impact on the rate of the tips and their ability to earn them," she said.

At most Las Vegas-area taxicab companies, drivers share in the cost of fuel, anywhere from 25 percent to 75 percent. New drivers at some companies pay 100 percent of the fuel costs during their first year of employment.

Union representatives asked the Taxicab Authority to regulate how cab companies share the fuel surcharge with their drivers. Werner-Collins said that would be impossible to oversee because different companies have different collective bargaining agreements with drivers. Some smaller taxicab companies are nonunion.

"The language in those contracts are all different," she said.

The fuel surcharge can be eliminated by Walker without taking it to the board if the average cost of a gallon of gasoline drops below $4 a gallon for 20 consecutive days. However, the Taxicab Authority board can consider raising the surcharge if gasoline goes above $5 a gallon for five consecutive days. Whatever the cost of fuel, the Taxicab Authority board will revisit the surcharge in January.

Several speakers suggested the temporary fuel surcharge be made permanent. Five times since 2003, the Taxicab Authority has implemented temporary rate increases, only to eventually make them permanent.

Eldon Alvord, a shop steward with the Industrial, Technical and Professional Employees Union that represents some 2,000 Las Vegas taxicab drivers, said no one believes gasoline prices are going to drop anytime soon.

"(The rate hike) should be permanent, but it should also be a rate increase that everyone could share," Alvord said.

Through May, taxicab ridership in Las Vegas is down 1.8 percent compared with a year ago. However, the average cost a consumer pays for a trip is $12.89, 11.6 percent more than they did a year ago. Taxicab rates went up 20 cents a mile last October. The average trip in Las Vegas is four miles.

Taxicab Authority staff asked the board to allow the increase to take effect after the Fourth of July in order to keep down overtime costs to change out rate cards and taxicab meters.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.

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Please enter your name Name: Please enter your email Email: Please enter a comment COMMENTS : (word count limit is 300) You have reached the maximum number of words allowed Current Word Count: Note: Comments made by reporters and editors of the Las Vegas Review-Journal are presented with a yellow background. wolf wrote on June 25, 2008 03:06 AM: If you look at the true picture,when the T.A. Board approved the Allotment in 2007,they set the stage to do the riding public an injustice!The staff recommendations of 11 cabs/company was not accurate or by any means a true statistical analysis but rather a crystal ball joke! This is a complete violation of the N.R.S.'s,when the only concerns is for the riding public! Staff Members who do these analysis must be accurate and provide documentation of the exact needs for the riding public and not some means to inflate the rates,to have the drivers and owners to debate to determine the appropriate level of medallions. Read the studies and not wish you could have the time to read what was presented by the owners, have them submitted three or four days prior to the meetings, for discussion and distribution to the defending organizations rather than it sure looks like we need more cabs! Go back and read your minutes from the prior meetings. When has the J.W Marriot opened,how many years? The bottom line is, if the allocation was not allowed,the rate increase would not be necessary!The drivers would be getting enough rides and the Average Revenue/Shift would not require an increase in the meter! Was this the best interest in the riding Public? No! Cabman if your reading you are very wrong,I'll take your Dollar bet! scott wrote on June 25, 2008 01:59 AM: To Bob, You are an idiot. You have no idea how many people get in my cab and tell me they bought the 24 hour monorail pass and rode it once because of what it takes to get to and from the rail. And if you had a brain you would know what to do when a driver takes you the long way in a cab that you dont ride in very often any how. To Kevin, the monorail is in junk bond status. HELLO! The airlines, tour busses, etc are adjusting for fuel prices but cab drivers cant? Andrew L wrote on June 24, 2008 09:04 PM: Ben, I drive a cab 3 days a week. I'm a 40 yo white male and have a masters degree in business. This is my 2nd job. I enjoy my job and most of the drivers are honest hard working men and women. Basically we work for tips. You are sadly mistaken if you think any cab in town get's 18 to 20 mpg. Try more like 8 to 12 mpg if your lucky. Most all drivers pay a shift fee, 76% to 100% of gas. If you do the math we get appox 30% of meter. On average a 12 hour shift meter is around $320.00. Putting approx $100.00 minus taxes in my pocket plus tips. So $75.00 divided by 12 hrs. This comes to $6.25 per hr. These guys can barly make a living. Be kind to your driver and they will be kind to you. the man wrote on June 24, 2008 05:11 PM: When do we get to charge them for being rude and arrogent. Especially the brain dead guys who manage the airport line of cabs. Great first impression for the tourists.... bob wrote on June 24, 2008 04:39 PM: The cabbies are THE reason we only have a semi-functional monorail system. I'm curious, what rights do you have if they try and take you the long way? Do you have to pay for it and what happens if you don't? Sorry, I don't take cabs very often. kevin wrote on June 24, 2008 04:29 PM: build the monorail extension to the airport. eliminate the cabbies altogether. TaxiBuzz wrote on June 24, 2008 02:53 PM: The unrestricted use of the tunnel to long-haul tourists is a cop out by the TA that allows the owners to report higher revenues per shift than 2007. The $400-$500 per shift meters collected by senior drivers who feel entitled to use the tunnel and newer drivers who have never know a time since the TA stopped patrolling the tunnel in Spring 2006 are all weighed against thousands of drivers who do not earn minimum wage and don't take their passengers on a longer route than necessary. At least 20% of drivers do not earn minimum wage and are demoted or fired, while other drivers take the easy out and receive praise and rewards from owners for deceiving the public. Tourists often don't know they've been ripped off, don't know the remedy, or simply don't want the hassle on their vacation of seeking a remedy. As a driver I heard outrageous stories from my passengers of cab rides that cost $35 to $40 to the Flamingo. I saw $23 meters at the Venetian everyday, when I know it only costs $14 for the trip. No one can tell me the tunnel is justified for any reason. In six years behind the wheel I used the tunnel only 2 of the 3 times I was asked to do so. I talked someone out of using the tunnel to go to the Hilton. I like the idea of Flat Fares, but the law will have to change before that can be accomplished. It now says drivers can't collect any more than what's on the meter. A small % of cabs run on propane. The type of driving cabs do they get 10 MPG. The fuel surcharge will be removed if gas goes under $4/gal for 20 days in a row. Learn more at TaxiBuzz.com. cas127 wrote on June 24, 2008 02:45 PM: Verga nailed it - taxi medallions are nothing more than a government sanctioned monopoly. Verga wrote on June 24, 2008 01:16 PM: Legal price fixing by unelected officals drawing a government (taxpayer)checks? Why not just let the companies decide what the will charge? Oh-- gosh you know some of them would not charge enough and everyone would want to ride that company. That would not be fair. SteveK wrote on June 24, 2008 11:37 AM: Still nothing done about 'Tunneling' and other long haul techniques. Beautiful. Two words: FLAT FARES. Read All Comments