Taxi Medallion Financing & Lending

A taxi medallion is nothing more than an exclusive (and transferable) license to operate a cab within (and specific trips outside) the boundaries of the municipality. The license is not to actually drive the cab (that is a different, separate driver's license) nor is it for a specific automobile. Some municipalities in the United State operate an open taxicab system of independent vehicle ownership (one driver / one vehicle) such that vehicle owners work for a taxicab company or are part of a taxicab association which operates the taxicabs (each entity has its own vehicle color scheme) under the approval of the local government.

Within each municipality indicated above, the total number of issued medallions / licenses are regulated and there are always a limited number of medallions available. The city government or responsible agency or commission must authorize any issuance (sale) of additional taxicab medallions.

The Atlanta Police Department, Division of Taxicabs & Vehicles for Hire has the oversight of licensing, permitting, and enforcement functions regulating the activities of all taxicabs and other vehicles for hire which operate within the City of Atlanta.

The Maryland Public Service Commission has oversight of the regulation of vehicle operations, licensing and rates within the City of Baltimore and County of Baltimore.

The Boston Police Commissioner has had exclusive jurisdiction over the regulation of taxi operations, including the issuance and transfer of medallions. The Hackney Carriage Unit of the Boston Police Department deals with taxi regulatory issues.

The Cambridge (Massachusetts) License Commission has oversight within the city. The commission is made up of representatives of a chairperson, the Fire Chief, and a Police Department representative.

The City of Chicago, Commissioner of the Department of Consumer Services, Public Vehicle Operations Division, has oversight of the regulation of vehicle operations, licensing and rates within the metropolitan Chicago area.

The District of Columbia Taxicab Commission has the oversight for the regulation of vehicle operations, licensing and rates within the jurisdiction of the District.

In Las Vegas the Nevada Taxicab Authority has the oversight for the regulation of vehicle operations, licensing and rates within the jurisdiction of the city and state.

The Board of Taxicab Commissioners advises the General Manager of the Los Angeles Department of Transportation on issues pertaining to the regulation privately owned taxicab franchises in the City (the Commissioners of the Board are appointed by the Mayor’s Office and confirmed by City Council). The Taxicab Rule Book provides the regulatory guidelines for vehicle operations and the rates are set by the Board. There are nine franchise taxi operators in the City of Los Angeles who operate more than 2300 taxis and all vehicles must have the official City of Los Angeles Taxicab Seal.

The Passenger Transportation Regulatory Division, Metro-Dade County Consumer Services Division (CSD) oversees taxi operations and licenses in Miami / Metro-Dade County Code, Florida. Taxicab medallions in Miami are issued by a Taxicab Medallion Lottery. Drivers are represented by the South Florida Taxicab Association.

The Nassau County Taxi and Limousine Commission, Nassau County Office of Consumer Affairs, regulates the registration of for-hire vehicles operating within Nassau County, NY. The actual licensing of vehicles and drivers is done by the municipalities within the County. Nassau County does not have reciprocity with New York City and Westchester County but operators with a Nassau FHV (For-Hire Vehicle) Registration Diamond may drop off at NYC airports, drop off (but not pick up) anywhere in NYC, and pick up at NYC airports for destinations outside of NYC excluding Westchester County.

The New York City Taxi and Limousine Commission has the oversight for the regulation of vehicle operations, licensing and rates within the five boroughs and airports.

The Newark Division of Taxicabs regulates taxi operations. The Office of the City Clerk is responsible for processing taxi and livery insurance policies and binders

The Orange County Transportation Authority (OCTA) regulates the operations of taxi services within the county through the Orange County Taxi Administration Program (OCTAP).

The Philadelphia Parking Authority (PPA), Taxicab and Limousine Division, regulates taxi and limousine services within the metropolitan Philadelphia area.

The San Francisco Taxi Commission merged with the San Francisco Municipal Transportation Agency (SFMTA) as the Division of Taxis & Accessible Services (DTAS) in March 2009, and the SFMTA now has oversight of the regulation taxi medallions within the city. Fares are set and enforced as part of Section 1135 San Francisco Municipal Police Code.

The Westchester County, NY, Taxi and Limousine Commission governs the licensing and regulation of the county's taxi and limousine industry.

Philadelphia

The Philadelphia Parking Authority (PPA), Taxicab and Limousine Division are the administrative agency with the authority for the regulation of Taxicab and Limousine Service in Philadelphia. (July 16, 2004, Act 94; transferred the oversight of the Philadelphia medallion taxis from the Pennsylvania Public Utilities Commission to the PPA).

Medallions may be owned by individuals or by corporations.

There are several taxi companies in Philadelphia, also known as a “Carrier”. In order to operate a taxi within Philadelphia, the carrier must hold a Certificate of Public Convenience issued by the PPA, which allows the holder to provide for-hire transportation service or dispatch services in Philadelphia. Carriers may or may not own the medallion(s) for every vehicle in their fleet.

The PPA also allows Driver Owned Vehicle (“DOV”) to operate within the city, which is an arrangement whereby a “Certified Driver” (see 13 below) owns the vehicle he or she drives but is not the owner of the Medallion and/or holder of the Certificate of Public Convenience. This is usually a driver that leases a medallion.

Medallions may not be transferred or sold without advance approval from the PPA TLD. The entire medallion transfer process must be supervised by the TLD and the final settlement must occur at a designated TLD office. Any attempted sale or transfer of a medallion outside of the TLD’s procedures will be considered void and may subject the parties to administrative penalties. The Medallion Ownership Transfer Fee is $750 or 1% of the purchase price, whichever is greater.

The medallion owner may operate the vehicle on their own (probably through a taxi company / carrier or Certified Dispatcher) and collect the daily receipts, or they may lease the medallion taxi to a Certified Driver. The driver may lease a vehicle that already has a medallion affixed to it or they may lease the medallion, which must be affixed to an approved (by the PPA) vehicle. Lease rates are set by the PPA.

New York City

In New York City, the medallion is actually a six inch diameter, stamped aluminum, numbered medallion that is affixed on the passenger side of the hood of the automobile and represents physical evidence of a taxicab license (the medallion number is also displayed on the taxicab roof light, on the license plate, on the exterior door exterior and within the vehicle). These are the ubiquitous "yellow cabs" (the color is required by law) that operate on the streets of Manhattan (and the five boroughs) and the license allows a person to stop and pickup a hailing passenger (without prior arrangement) requesting transportation. These taxicabs are also metered and operate at set fares / rates per mile and waiting / idle period. There are other car services and limousine services that operate within the five boroughs however they do not have the legal right to pick up hailing passengers from the streets (however, they are regulated by the City).

In New York City, the Taxi and Limousine Commission (TLC) has oversight of the taxicab industry and "establishes and enforces professional and uniform standards of for-hire car service and ensures public safety." At March 2009 the TLC estimates that it regulates 13,237 medallion taxicabs, 39,717 for-hire vehicles, 2,287 paratransit vehicles, 256 commuter vans and 101,564 drivers. The Commission regulates 28 taximeter shops, 25 taxicab brokers and 68 taxicab agents. The Taxi and Limousine Commission’s budget is funded entirely with City tax-levy funds, taxi inspection and transfer fees, and taxi fines and forfeitures.

The City of New York TLC also earns income from issuing an auctioning new medallions but it also closely regulates the number of available medallions. The last record of the TLC auctioning new medallions were in:

2004 - 600 medallions

2006 - 308 medallions (254 for hybrid fuel vehicles and 54 wheelchair accessible vehicles only)

2007 - 63 medallions (for wheelchair accessible vehicles only)

2008 - 89 medallions (87 medallions for wheelchair accessible minivans)

The 13,237 taxicab medallions presently outstanding and regulated by the TLC are further divided into 4,876 individual owner-driver medallions and 8,361 fleet or corporate-owned medallions. This means that in New York City, either an individual or a corporation can purchase a taxi medallion (a corporation must own a minimum of two medallions). Corporate medallions are more expensive because a business can own several, they can be leased to drivers and can be operated for more than one shift per day. An individual taxi medallion can be leased out but only after the owner meets a service requirement of 210 nine - (9) hour shifts that he must drive himself. Once that is met he must have Workman's Compensation Insurance on file at the TLC. Only then can a driver lease out his medallion. Overall, ownership is fragmented with no single company having a controlling share of the medallion market. However, the industry is divided among three primary sectors: large, profitable fleet owners that own many medallions and cars; independent owner operators with one to five medallions / cars; nonunionized drivers who rent medallions / cars from fleets or leasing agents.

Medallion Financing

As indicated above, a taxi medallion is a license that can be transferred between parties by outright sale.

New York

The largest, most well developed and liquid market for medallion financing is the City of New York. As of March 2009, the average price (as reported by the New York City Taxi and Limousine Commission) for an individually purchased medallion was $565,000, and the price for corporate owned medallion was $750,000 (this would indicate a combined market valuation of individual and corporate yellow cab medallions operating in New York City of $9.03 billion - $2.75 billion for individually owned medallions and $6.27 billion for corporation medallions). Medallion Financial Corp., the largest and longest serving financer of taxi medallions, indicates that New York City taxi medallions have appreciated at a CAGR of 14% per annum over the past 50 years (the market value of a medallion in 1947 was $2,500). The last decline in value and low point was approximately October / November 2001, at which point corporate medallions had a market value of $199,000 and individual medallions had a market value of $180,000. However, the value recovered after tourism rebounded.

The prices have been increasing steadily over the past 4 years, even in spite of the credit crisis that effected employment in Manhattan and/or the ability to obtain medallion financing:

Individual owned medallions increased from $414,000 in January 2007 to $426,000 by December 2007 (a price increase of 2.89%). By December 2008, the individual medallion price increased to $550,000 (a 29% increase from December 2007). By December 2009, the individual medallion price increased to $584,000 (a 6.2% increase from December 2008). By December 2010, the individual medallion price increased to $624,000 (a 6.85% increase from December 2009). In October 2011, the prices for individual medallions averaged $694,000.

Corporate owned medallions increased from $522,000 in January 2007 to $600,000 by December 2007 (an increase of 14.9%). By December 2008, the corporate medallion price increased to $747,000 (a 24.5% increase from December 2007). By December 2009, the corporate medallion price increased to $775,000 (a 3.75% increase from December 2008). By December 2010, the corporate medallion price increased to $850,000 (a 9.7% increase from December 2009). On October 19, 2011, two corporate medallions sold for $1.0 million (a 637% increase in value since 1990).

The regulated number of available taxi medallions tends to inflate the price due to scarcity, not just in New York but in several markets. Overall, an investment in a New York City taxicab medallion has performed well over the past seven years.

Why the substantial increase in value in 2008? The increase in the value of the medallions is the direct result of an influx of drivers (new and former drivers) requesting the opportunity to drive a taxicab, which means that the taxicab can be operated at least 2 shifts per day (a shift is supposed to be 12 hours but can be unofficially divided into three 8 hour shifts). Thus, the greater the amount of revenue an asset (medallion taxicab) will generate the greater the price of the asset. The values of both individual and corporate medallions really started increasing after June 2008, which corresponds with the increase in unemployment. The corporate medallion went from $625,000 at June 2008, with no sales in July and August, to $725,000 in September 2008.

In New York City, the sale and transfer of the taxi medallions are handled exclusively by 25 TLC approved and licensed medallion brokers. Owners and purchasers must work through one of these brokers: a medallion is not sold and transferred between private parties. The medallion owner may locate a party that will negotiate and agree to the highest market value but the transaction must eventually have the approved broker involved in the sale and transfer. The broker may also act as an agent or intermediary in negotiating the transfer of medallion on the behalf of the owner. The limited number of available medallions and the intervention of the brokers results in a system that always seems to have a ready market of purchasers.

In New York City, there is also a well developed medallion financing industry consisting of local credit unions, banks and specialty finance companies. The largest lender in the market is Medallion Funding Corp. of New York. At December 31, 2008, Medallion Funding's on-balance sheet taxicab medallion loan portfolio totaled $402,964,000, and when serviced loan participations are included then total managed medallion loans amount to $591,413,000 (medallion loans collateralized by New York City taxicab medallions and related assets comprised approximately 74% of the total managed portfolio). Medallion Funding Corp. has securitized some of their medallion loans through Taxi Medallion Loan Trust I, II and III with a commercial paper program managed by Autobahn Funding Company LLC (DZ Bank).

Brokers may also be involved in the negotiating of a loan secured by an encumbrance upon or transfer of a taxicab medallion or licensed vehicle.

Chicago

Similarly, most medallion sales in Chicago are handled through brokers or attorneys. In the second quarter 2008, Medallion Funding Corp. reported in their earnings release that the price of Chicago medallions had increased to $140,000 per medallion (which is up substantially from approximately $77,000 in 2007).

Miami

In Miami, an annual lottery is held (600 to 700 medallions) and each driver must be one of those drawn in order to have a medallion. If selected, the winner must pay $25,000 to the Metro-Dade County Consumer Services Division (CSD) for the license to operate for one year. However, if one is not selected then one must purchase the medallion in a secondary market and in the 1st quarter that price was approximately $150,000 to $200,000.

Taxicab Operations

In New York City, the TLC sets the fares charged by medallion taxicabs - Standard City Rate (Rate Code 1)

$2.50 upon entry

$0.40 for each additional unit, which is:

one-fifth of a mile, when the taxicab is traveling at 6 miles an hour or more; or

60 seconds when not in motion or traveling at less than 12 miles per hour.

The taximeter shall combine fractional measures of distance and time in accruing a unit of fare. Any combination of distance or time shall be computed by the taximeter in accordance with the National Bureau of Standards.

The fare shall include pre-assessment of the unit currently being accrued; the amount due may therefore include a full unit charge for a final, fractional unit.

Night surcharge of $.50 after 8:00 PM & before 6:00 AM

Peak hour Weekday Surcharge of $1.00 Monday - Friday after 4:00 PM & before 8:00 PM

There are several ways to earn a return on a taxicab medallion.

One can just purchase a medallion only (no car involved). In New York City, the owner of the medallion only can lease it to a broker or agent or garage for $842 per week (regulated by the TLC) or $43,784 per annum. However, that is the maximum they could receive, which they may not obtain so that the lessee (for instance, a garage) can improve their profit return on managing the medallion on the behalf of the owner. At the $750,000 value for the corporate medallion the price may not make sense anymore for a medallion-only investor):

Financing 80% ($600,000) at 5.75% with a 25-year amortization schedule results in an annual payment of $45,296 per annum (plus the investor has to come up with the $150,000 equity investment).

At 5.50% the annual debt obligation would be $44,214, which is a little more tolerable if the medallion still continues to appreciate at 14% per annum.

A corporate medallion owner can also lease their medallion(s) already affixed to vehicle to a broker who will lease it to a fleet operator or to a driver. A fleet operator (also known as a fleet if they have 25 or more medallions or mini-fleet operator if they have a minimum of two medallions) leases medallions or cars with medallions to drivers. The fleet operator / garage owner normally pays all expenses for the maintenance of the car with an affixed medallion when the medallion owner leases the car and medallion to him.

The lease between the fleet or taxi medallion owner essentially means between the licensed owner (or his agent) of a City of New York taxicab medallion ("lessor") and a City of New York licensed medallion cab driver ("lessee") authorizing the use of the medallion or a taxicab vehicle with a medallion.

The TLC regulates "lease caps," the amount a fleet or taxi owner may charge for the use of a taxicab medallion license. The Standard Lease Cap for a medallion and vehicle for one twelve-hour shift shall not exceed:

$105, for all day shifts

$115, for the night shift on Sunday, Monday and Tuesday

$120, for the night shift on Wednesday

$129, for the night shifts on Thursday, Friday and Saturday

 

The Standard Lease Cap for a medallion and vehicle for one shift for a week or longer shall not exceed $666 weekly.

Source: www.nyc.gov/html/tlc/downloads/pdf/rules_leasecap_promulgated.pdf

How much can a medallion owner potentially earn on a New York City corporate medallion in one year (assumes no downtime for the vehicle or shift drivers)?

$38,325 (365 days X $105 day shift rate)

$17,940 (156 days X $115 night shift rate Sunday, Monday and Tuesday)

$6,240 (52 days X $120 night shift rate Wednesday)

$20,124 (156 days X $129 night shift rate Thursday, Friday and Saturday)

Total: $82,629

 

A medallion leased at the basic weekly rate could potentially earn $34,632 ($666 X 52 weeks)

Additional income is earned for either the medallion car owner and/or the fleet operator by selling advertising on top of the roof of the vehicle.

An individual driver can either lease a car with a medallion affixed to the vehicle from a garage on a daily (shift lease) or weekly basis, or lease the medallion and buy the car, or buy the medallion and the car. The rule-of-thumb decision making criteria is that if one plans to do it short-term then lease the medallion and car; longer-term (approximately 3-5 years) then lease the medallion and buy the car; long-term then buying the medallion and the car is the best as the real value in the business is in the appreciated value of the medallion.

For the individually-owned medallion driver it is a different story: if they have the stamina to drive 12 hours per day then they keep whatever they earn. However, they are also responsible for the expense for fuel, general maintenance and upkeep, annual registration, credit card cost, insurance deductible (cover minor damages out of pocket), and the medallion loan payment. It must be noted though that an individual taxi medallion can also be leased out after the owner meets a service requirement of 210 nine - (9) hour shifts that he must drive himself. Once that minimum shift amount is met and the owner has Workman's Compensation Insurance on file at the TLC they can lease out the medallion and increase their earnings.

At the bottom of the chain is the driver who leases a medallion cab per shift (does not own the medallion or the vehicle). Overall, taxicab drivers who lease a medallion and car encounter long hours and low earnings.

How much can a taxi driver earn? That will depend upon:

How many hours they work

Whether they work a day or night shift

What is the weather / season (inclement / colder weather conditions causes more people to take taxis)

What is the lease rate

Whether they own the car

Whether they own the medallion

Individual traits of work ethic, personality, etc.

How much they earn in tips (which are kept by the driver)

The University of Illinois’ School of Labor and Employment Relations in cooperation with the American Friends Service Committee’s (AFSC) Taxi Worker Organizing Project and the United Taxi drivers Community Council (UTCC) in Chicago conducted a survey and study in 2008 and found the following information about Chicago medallion drivers (920 drivers; approximately 8.76% of licensed taxi drivers):

Weekly-lease drivers (lessee) compose the majority (54.7%) of the respondent population

They worked an average of 13.26 hours per shift and 25 days per month

Lessee's are responsible for the expense for fuel, general upkeep, airport tax, credit card cost, insurance deductible (cover minor damages out of pocket), the medallion lease

Earned an average net annual income of $13,518.20 or $4.81 per hour

Daily-lease (shift-lease) worked an average of 12.73 hours per shift and 24 days per month

Shift-lease drivers earn an average annual net income of $11,496.90 or $4.07 per hour

Source: Bruno, Dr. Robert; School of Labor and Employment Relations, University of Illinois; Driven Into Poverty: A Comprehensive Study of the Chicago Taxicab Industry; 2008.

In New York City, an applicant for a TLC taxicab driver's license (hack license) must:

First apply for and obtain valid New York State Department of Motor Vehicles (DMV) Chauffeur's license (classes A, B, C and E are acceptable)

Be at least 19 years old

Be a legal resident of the United States (U.S Passport or Birth certificate, Green Card and Work permit)

Have a valid and an original Social Security card

File a notarized Child Support Certification form from the NYC Office of Child Support Enforcement

Bring an original certificate of completion or a temporary completion receipt of a NYS DMV Certified Defensive Driving Class (DDC) completed no older than six (6) months from the date of submitting the application

Attend an approved taxi school for either the 80-hour or the 24- hour course (taking the 80-hour course increases the chance of passing the taxi exam because it covers additional material not covered in the 24-hour course)

After completing the taxi school course the applicant must then pass the English proficiency test and the written test with a score of 70 or above

Personally visit a TLC approved lab to submit to a drug test

Be photographed and fingerprinted at the TLC facility on the day that you file your application

In addition to paying the medallion loan or the lease rate the driver must also pay for fuel, occasional tolls, municipal and state taxes, insurance (including defensive driving course), maintenance (oil changes, brakes, tires), repairs, tickets / summonses, equipment (trip log sheets, meter paper, windshield fluid), towing in the event of a breakdown, and random and quarterly inspections. The official taxicabs must also compete against black cars (radio dispatched limousines) illegally stopping to pick up passengers on the street. Passengers also expect the driver to know the city and exactly where the address is and the most direct and least expensive route. The driver must also know the city-wide traffic laws and the specific traffic regulations for specific section of a street. In the metropolitan New York market, a driver will drive on average 45,000 to 50,000 miles per year.

Insurance is provided by specialty insurance companies that offer commercial automobile coverage and have a medallion taxi underwriter.

A car is not always available to a new driver and the industry is seasonal. For instance, the period from October to Christmas is probably the busiest time for drivers to earn regular fares plus tips due to the colder and wetter weather and the holidays. Thus, most individual owners and primary drivers are working at this time and a new driver may not be able to locate a car. The slowest season for drivers is the Summer because either the business fares are on vacation or the weather is pleasant enough to walk.

The medallion must be affixed to a vehicle to earn money. Converting a new or used vehicle to being a taxicab is known as a "hack-up". As of the 4th quarter 2008 there are approximately 1,551 fuel efficient vehicles in operation in the New York City market. The primary vehicle used in the New York City fleets is the Ford Crown Victoria but hybrid vehicles are being promoted to replace those models (every hybrid taxi operating in New York City has the "Greenyc" sticker on the rear pillar).

The Following Vehicles are Currently in Use as New York City Taxicabs:

2009-Ford Crown Victoria Stretch

2009-Chevrolet Malibu Hybrid

2009-Saturn Aura Hybrid

2009-Chevrolet Malibu Hybrid

2009-Volkswagen Jetta Clean Diesel Sedan

2009-Lexus RX400h

2009-Toyota Camry Hybrid

2009-Toyota Prius-48 mpg city

2009-Toyota Highlander Hybrid (4WD)

2009-Saturn Vue Greenline

2009-Nissan Altima Hybrid

2009-Ford Escape Hybrid (2WD)

2009-Mercury Mariner Hybrid (AWD)

2010-Camry

2010-Prius

2010-Highlander

 

The following are the approved for use as Wheelchair Accessible Taxicabs:

2007-Eclipse Mobility Dodge Caravan

2007-Eldorado National Mobility Chevrolet Uplander

2007-2008 Autovan Toyota Sienna

2007-2008 Freedom Motors Toyota Sienna Kneelvan

The NYC Taxi & Limousine Commission is conducting a "Taxi of Tomorrow" survey   www.taxioftomorrow.com/

In 2007, NYC taxicabs were required to install credit card readers in the backseat passenger area. There was quite a bit of opposition from drivers and owners at the time due to the cost of installing the card readers plus this is traditionally a cash business. However, the New York Times reported in November 2009 (City's Cabbies Like Plastic. Who Knew?; Gyrnbaum, Michael M.; New York Times, Sunday, November 8, 2009; p. 1) that cab drivers indicated that ridership was up and tips were up related to the acceptance of credit cards (the New York TLC indicated that as of November 2009, revenues had increased 13.0% since the beginning of the year). The card reader allows the rider to swipe the card themselves (rather than hand it to the driver in the front), and there is neither a minimum payment or the requirement to sign a receipt. However, the New York Times article indicates that drivers are required to "wait anywhere from a day to a week" in order to receive a fare that was paid for by credit card. The New York Times article also suggests that perhaps increased credit card usage (from 20% of rides at year-end 2008 to 28% by September 2009) could also be a reflection of tighter cash flow problems of riders.

Taxi Medallion Loan Underwriting

Using the New York City corporate medallion as a model:

Above it is demonstrated that with no downtime a taxicab with medallion leased a day shift and night shift per day could potentially earn $82,629 per annum. Assume that the vehicle or shift driver(s) are unavailable 25% of the time and that results in an income of $61,972 per annum.

Because of the annual appreciation of the taxi medallion as an asset and the ready market of purchasers, some medallion financers have gone as high a 90% LTV but the more conservative approach is 80%. On a corporation medallion value of $750,000 at March 2009 that results in a loan of $600,000 (but puts the borrower in the position of coming up with a $150,000 down payment).

Interest rates in the New York medallion market have ranged between 5.250% and 6.750% over the past three years. Assume a rate of 6.00%.

The loan structure for a medallion is usually a 3 or 5-year term with a 25-year amortization schedule. Medallions are also acceptable for SBA financing and sometimes a 7-year term is available. Assume a 5-year term / 25-year amortization.

$600,000 at 6.00% at 25-year amortization results in an annual debt obligation of $46,390

Thus, the Debt Service Coverage (DSC) is 1.34X ($61,972 divided by $46,390).

It is more difficult to determine the annual cost of the vehicle. A 2008 Ford Crown Victoria with 45,000 miles and no accidents sells for approximately $10,500 to $14,000 and the medallion owner can purchase it outright, finance it or take over payments. In any case, a second ratio needs to be taken with the automobile obligation added to the medallion loan obligation.

If the medallion is corporately owned for more than a year (refinance) then the corporate tax returns are utilized to develop the income flow, which would include adding back depreciation and interest expense to the net income.

If the medallion is individually-owned then the Schedule C income from the IRS Form 1040 would be analyzed. The net income plus the add-back of any interest being paid on an existing medallion loan plus depreciation must be sufficient to cover the loan payment.

Credit Issues

Taxi medallion financing is a specialty area and one has to participate at a minimum on a weekly basis to know exactly what are the medallion prices, loan rates and driver income.

From the 4th quarter 2008, through 2009, and into the 1st quarter 2010, both full time drivers and part-time weekend only drivers indicate that their income has been declining in relation to the burgeoning recession.

Taxi Medallion Information Sources

Atlanta Division of Taxicabs & Vehicles for Hire   www.atlantapd.org/Index.asp?nav=vfh&menu=6

Boston Police Department Hackney Carriage Unit   www.cityofboston.gov/police/hackney/

Chicago Commissioner of the Department of Consumer Services   egov.cityofchicago.org/

Dade County Consumer Services Division (CSD), 2009 Taxicab Lottery   www.miamidade.gov/csd/library/2009_Lottery_Information_Pkg.pdf

Dade County Consumer Services Division (CSD), Taxicab Driver Resources and Information   www.miamidade.gov/csd/taxi_resource_info.asp

District of Columbia Taxicab Commission   www.dctaxi.dc.gov/dctaxi/site/default.asp?dctaxiNav=|

Los Angeles Board of Taxicab Commissioners   www.ladot.lacity.org/about_Commissions_taxicab_records.htm

Maryland Public Service Commission (Baltimore)   webapp.psc.state.md.us/Intranet/home.cfm

Nassau County Taxi and Limousine Commission   www.nassaucountyny.gov/agencies/OCA/TLC/index.html

Nevada Taxicab Authority   taxi.state.nv.us/

New York Taxi & Limousine Commission   www.nyc.gov/html/tlc/html/home/home.shtml

New York Taxi & Limousine Commission - Average Medallion Price(s)   www.nyc.gov/html/tlc/html/misc/avg_med_price.shtml

New York Taxi & Limousine Commission - Rate of Fare   www.nyc.gov/html/tlc/html/passenger/taxicab_rate.shtml

New York Taxi Workers Alliance   www.nytwa.org/

Newark Division of Taxicabs   www.ci.newark.nj.us/government/city_departments/city_clerk/taxi_and_livery.php

Orange County Taxi Administration Program (OCTAP)   www.octa.net/OCTAP.aspx

Philadelphia Parking Authority (PPA), Taxicab and Limousine Division   www.philapark.org/tl2/taxi_limos_regs.html

San Francisco Municipal Transportation Agency (SFMTA)   www.sfmta.com/cms/xhome/hometaxi.htm

Westchester County Taxi and Limousine Commission   tlc.westchestergov.com/