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The Last Taxis in Town

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By Jorge Casuso

September 7, 2023 -- Fourteen years ago, Santa Monica was a wild west for taxi cabs, as the City scrambled to curb the 511 permitted cabs operated by 55 companies.

On Tuesday, the Council is expected to end a long era that saw cab stands blossom on busy Downtown curbsides and long lines of marked taxis queue up for passengers hailing a ride.

With only 10 cabs operated by a single company -- Taxi! Taxi! -- left in Santa Monica, the City Council is expected to scrap the franchise system it implemented in 2010 at the end of this year.

"Since 2009, drastic changes have affected the taxicab industry," City staff said, most notably "the rise in the use of Transportation Network Companies (TNCs) like Uber and Lyft for ride-hailing services."

Staff is recommending the City "shift from a franchise program for regulating taxicabs to a permit-based system similar to a shift that the City of Los Angeles adopted in 2022."

That open market system -- which has also been adopted by other area cities, including Beverly Hills -- allows anyone to offer taxi service if they have a license, insurance, training, undergo security checks and have their vehicle inspected.

The franchise system adopted in Santa Monica granted taxi cab franchises to five companies in a highly competitive process that spurred protests from the eight companies that weren't chosen.

Then in 2017, taxicab regulations were revised under state law "to address industry challenges due to the rise of TNCs," staff wrote in a report to the Council.

"Most notably, by January 1, 2019, taxicab permitting moved from a patchwork of local requirements to a countywide system that only requires taxicab drivers and companies to obtain a permit in the jurisdictions where they are 'substantially located.'”

Today, Taxi! Taxi! is the only one of the five original companies operating under Santa Monica's franchise system, and it is doing so after reducing its fleet of 59 taxicabs to ten.

Not all regulations will change under the proposed permit-based system, staff said.

"Taxicab companies other than those substantially located within Santa Monica can still conduct prearranged trips," according to the staff report.

"However, no street hailing will be permitted by companies not substantially located within the City. Additionally, none will be permitted to stand and queue for passengers."

Under the current franchise system, Taxi! Taxi! is the only company allowed to use the few taxi stands left in Santa Monica before they are converted into short-term parking or dynamic loading zones.

"Over the years and during the COVID-19 pandemic, taxi stands have seen less and less use and have been repurposed for a variety of uses such as Zero Emission Delivery Zones, loading zones, and parklets," staff wrote in the report.

Under staff's proposal, the taxicab franchise will be allowed to lapse on December 31, 2023.

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