With thousands of struggling New York City yellow cab drivers like Mouhamadou Aliyu desperate for a bailout, elected officials on Thursday quarreled over who should pay for it.
Aliyu, 47, emigrated from the Ivory Coast to New York in 1994 in hope of a better life. Now, thanks to plummeting yellow cab medallion values and predatory lending practices, he’s $700,000 in debt and often considers killing himself.
“I’m under water. I can barely survive,” said Aliyu, who bought a taxi medallion for $370,000 in 2004. “We are asking for relief because we really have nothing to do with all this suffering, but we’re the ones who are paying the price.”
New York House Democrats sent a letter to city officials on Thursday demanding they solve the problem by helping to pay off the debt of medallion owners like Aliyu. “We strongly encourage you to explore ways to provide much needed monetary assistance to relieve the thousands of medallion holders stuck in high interest loans with tremendous balances,” the letter says.
The group of House Democrats said the woes faced by thousands of yellow cab drivers is the city’s fault.
That’s because the city promoted medallions as secure investments and collected taxes on their sales — even amid worries inside city government that medallions were overpriced. A city Taxi and Limousine Commission policy analyst wrote a five-page memo in 2011 saying the quick rise of medallion prices from 2003 to 2010 outpaced the taxi industry’s growth.
As Uber and Lyft expanded, yellow cab medallion prices plummeted. On top of that, the House Democrats’ letter notes, “unscrupulous lenders” took advantage of the situation, making millions in the process.
Aliyu — a father of four — said he’s missed the last three payments on his loan, which ballooned over the years after he purchased new taxi cars and took out money using his medallion as collateral. Aliyu said the unregulated rise of Uber and Lyft has cut into his customer base, making it even more difficult for him to pay off his debt.
“Whenever I talk about this the first thing that comes to my mind is suicide,” he said.
Suicide rates among city cab drivers have soared in recent years. In 2018 alone, eight cabbies took their own lives amid taxi medallions crashing in value.
Mayor de Blasio, who was looped in on the House Democrats’ letter, said the city cannot afford the expense of bailing out the cabbies.
The mayor also noted that the federal government had the authority to crack down on lenders who preyed on medallion buyers — a power the city does not wield.
“Even the folks who are pro-bailout acknowledge it’s billions of dollars to begin,” the mayor said. “It’s just literally a budgetary impossibility. We can’t do it unless we want to cut back on schools or cops or fire or something else. We cannot do it.”
The mayor further argued that the federal government has “almost limitless resources” that could be used to bring some relief to medallion owners.
The suggestion from Capitol Hill was spearheaded by Brooklyn Rep. Nydia Velázquez and signed by nine other local representatives, including House Democratic Caucus Chairman Hakeem Jeffries.
In 2014, dozens of taxi medallions sold for upwards of $800,000. Some went for more than $1 million each. Since 2018, not a single medallion has sold for more than $500,000.
The 10 New York Congress members said medallion owners need relief from the city that betrayed them.
“In addition to ensuring that lending practices are improved so that this crisis does not worsen, we need to take action now for the thousands of drivers who are facing financial ruin,” the lawmakers wrote.
Councilman Ydanis Rodriguez, who chairs the Transportation Committee and co-chairs the city’s “Taxi Task Force,” said he welcomes “any suggestion” to help medallion owners.
“I also will welcome an effort from members of the congressional delegation to help bring funding from the federal government to help this situation,” Rodriguez said.
Velázquez countered that the only tenable long-term solution is for the city to help drivers out financially.
“These medallion holders, many of them immigrant New Yorkers, were sold a bill of goods, mortgaging their futures after being told a medallion was a certain ticket to the middle class,” the congresswoman told The News.
“Now, that the bottom has fallen out, we’re seeing them drowning in debt. The city profited off these medallion auctions handsomely and has a moral incentive to help.”
I don’t think the title of your article matches the content lol. Just kidding, mainly because I had some doubts after reading the article.