Through a program negotiated last year by former Mayor Bill de Blasio and Sen. Chuck Schumer, loans on some medallions may be reset to $200,000, with the city paying down $30,000 on each reset loan’s balance and guaranteeing the new loan amounts.
Owners of roughly 1,000 yellow taxi medallions enrolled in the program as of Friday, erasing an average balance of $225,000 from each loan, officials said.
“Market forces like the explosion of app-based for-hire vehicles (and) the pandemic destroyed the value of these medallions,” Schumer said at a news conference at City Hall.
The medallion owners who enrolled in the program “are still paying a debt, but a debt they can live with and work and be proud and support their families,” Schumer said.
The reset loans are a godsend for many owners of yellow taxi medallions, which give cabbies the exclusive right to take street hails in the busiest parts of the city.
Thousands of cabbies were drowned in debt in the late 2010s after the value of their medallions shrunk from more than $1 million to less than $200,000 in a five-year span. At least eight city taxi drivers committed suicide in 2018.
Many cabbies were preyed on by unscrupulous lenders, with some refinancing the loans on their medallions and taking out more and more debt, a 2020 City Council report found.
Medallion values plunged after Uber and Lyft launched in New York City in 2013 and 2014, deploying more than 80,000 cars on the streets and ending the monopoly medallion taxi drivers had held since the 1930s.
Officials under de Blasio negotiated the loan reduction deal last year after medallion owners went on a hunger strike. Schumer said Friday he urged the ex-mayor to create a program after Congress allocated billions in pandemic relief for New York.
The deal is so far only available to owners of about 3,000 of the roughly 4,000 medallions whose loans are held by the private equity firm Marblegate, said the company’s chief investment officer Andrew Milgram. Those with loans held by the company have until next Friday to enroll in the program.
Bhairavi Desai, head of the Taxi Workers Alliance, thinks the restructuring of the Marblegate loans sets a precedent for other lenders to follow suit.
“We found a solution that is economically viable, and we call on all the lenders to come forward and to participate,” said Desai. “We think there are around 850 medallion loans that are spread out across 19 of those lenders... And we’ve been working to bring all of them to the table.”
The medallion owners who took the deal with Marblegate must pay $1,234 each month on their reset loans — as the yellow taxi industry continues to reel from the impact of the COVID pandemic.
Just 7,156 of the city’s 13,500 yellow taxis were on the streets in July, data from the Taxi and Limousine Commission show. That’s down from 11,366 in the same month of 2019 and from 13,320 in 2012.
The average yellow taxi that operated on the streets in July raked in $269 per day, the data show. That’s down from $308 per day in July 2019 — and from $397 in July 2012.
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