Business/Economy, Economy, Politics, Transportation

Blake: Newest taxi company will also be the largest

GreenTaxiLogoColorado’s newest taxi company has been authorized to be its largest right off the bat.

The Public Utilities Commission just approved the 800-member Green Taxi Cooperative’s application to serve seven metro Denver counties. President Abdi Buni said it plans to start operations on the evening of July 4 by offering four hours of free rides.

Metro Taxi, largest of the legacy cab companies, protested Green’s application and has the right to request a rehearing but probably won’t. Green, the first company to get started under the legislature’s 2015 law liberalizing taxi regulation, won approval from the PUC’s staff and an administrative law judge before getting a unanimous thumbs-up from the three-member PUC.

Line of TaxisMetro argued as though it were still 1966, when a would-be taxi company had to prove in advance there was a “need” for its service and existing companies were invited to show there was not.

That did not please the redoubtable Frances Koncilja, the PUC’s newest commissioner, who termed Metro’s resistance as “frivolous and specious.” She suggested that Green might want to seek attorney’s fees if Metro pursued the case further.

About 50 of the co-op’s would-be drivers, dressed in suits and ties, packed the hearing room. Most of the 800 co-op members are immigrants, primarily from Africa and the Middle East, and many have been driving for Metro and Yellow Cab, or even transportation network companies like Uber and Lyft.

Koncilja, who grew up in Pueblo, noted that her own parents were immigrants who couldn’t speak the language and said the applicants had waited long enough to get the company operating.

Green will be not only the largest taxi company in the state, it will be the largest taxi co-op in the nation, according to Jason Wiener, its attorney. Union and Mile High Cab companies, smaller Denver-based firms, are also run as co-ops.

Why would anyone start a taxi company when existing ones have been hurt by the rise of ride-sharing companies like Uber who use cell-phone apps to connect would-be passengers with drivers who own their own cars? Uber, founded in 2009, already does business in 404 cities in 60 countries around the world. Taxi drivers have often rioted in protest and sought to pass local legislation to cripple the new competition.

It’s easy enough to see why Yellow and Metro drivers might want to join Green. Their firms can charge lease rates of up to $800 a week while Green will charge only about $600 a month, according to Buni.

But why would Uber and Lyft drivers join Green? “Here they see they own the whole business,” said Buni. “ Drivers understand that owning is better than driving for others.” All will own their own cars as well as the business itself.

The fees paid by the drivers will be used for insurance, hiring managers and technology costs. Money that is left over at year’s end goes back to the drivers except for capital that might be needed to expand the business.

Halisi Vinson, executive director of the Rocky Mountain Employee Ownership Center, claims that Green drivers will be able take home more than Uber drivers,who generally pay the company 20 percent of their receipts plus a “rider fee.”

Each driver has one vote in the co-op but the year-end dividend isn’t divided equally among members. Nor is it “from each according to his ability, to each according to his need.” Communism it’s not. The dividend is apportioned among drivers based on their productivity in the co-op.

Green is working on a credit-card app to compete with Uber, but unlike Uber it will also take cash, said Buni. Insurance must be purchased and the cabs — which all will be 2010 models or newer — must be painted with the Green logo. All 800 won’t be ready by July 4 but he hopes to have almost 300 ready by then.

He claimed the projected per-mile rate of $1.85 would be the lowest in the area.

The company is being supported by the Local 7777 of the Communications Workers of America and is temporarily headquartered in its Englewood offices. Buni, who also helped Union Taxi get started, doesn’t expect to stay as president. He has his own company to run, ABC Shuttle.

The other five Denver-area taxi companies are licensed to run between 150 and almost 500 cabs.   If there’s a flaw in the current system it’s that the PUC is still authorized to control the number of certificates each company gets, and the older ones may have a hard time expanding their fleets no matter how they’re doing in the market.

Longtime Rocky Mountain News political columnist Peter Blake now writes once a week for CompleteColorado.com. Contact him at pblake0705@comcast.net You may re-publish his work at no charge and without further permission; please give full credit to Peter Blake and www.CompleteColorado.com.

 

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