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City Council signaled a desire to roll back regulations affecting taxi cab owners and operators in Evanston, indicating an understanding that largely unregulated Uber, Lyft, and similar services enjoyed an unfair advantage as long as taxis faced strict, expensive and onerous City ordinances. At the same time, Council members said they would seek to preserve the medallion system limiting the number of official taxicabs legally operating in Evanston. 

“I don’t think anyone could have predicted the changes in this market,” said Alderman Brian Miller, 9th Ward, at the Administration and Public Works committee on June 13. His comment summed up the reaction of Council to the advent of Uber and the resulting shrinking taxi market evidenced by the lack of officially licensed taxi drivers in the City.

Under City law, 140 medallions are permitted at any time, designed to ensure a steady supply of available cabs in Evanston while keeping out non-medallion owners who might swoop in and poach higher-paying fares, such as airport or Chicago Loop rides, mostly from hotel stops. Taxis without Evanston medallions are permitted to drop passengers off here, but not to pick up rides. 

The issue cropped up several years ago when taxis lobbied Council to crack down on outside cab companies – those without Evanston medallions – from picking up fares who specifically called such cabs for rides to the airport. Non-medallion cabs were lingering along McCormick Boulevard – just across the Evanston border – waiting for calls, some drivers said at the time. Council declined to act then, though whispers began then about possibly loosening the Evanston regulatory scheme. 

Fast forward to the Uber era, and taxi competition has increased exponentially.  Right now, said City Corporation Council Grant Farrar, the City has about 100 registered drivers for its 140 active medallions. Taxi owners appeared before City Council in meetings this year seeking relief from City ordinances requiring annual license fees for both the vehicles and the drivers (chauffeur licenses). Uber, Lyft, and other TNPs – Transportation Network Providers – are not subject to such requirements. 

Last year, City Council decided not to regulate TNPs at all, and instead to rely on State of Illinois laws to provide all such regulation. By a vote in February 2015, Council explicitly adopted the State Transportation Network Providers Act, leaving the entire matter up to the State. 

On June 13, Council instructed City staff to adopt the same regulatory scheme for taxis – let the State handle most regulation of taxis.  “My preference would be to completely deregulate [at the municipal level] and to have TNPs and taxis follow the State regulations,” said Alderman Ann Rainey, 8th Ward. “I think we should do a “hands off” and do a deregulation completely.” 

She said she supported “ripping up our ordinance having to do with taxicabs. Let the State regulate them.”

Alderman Peter Braithwaite, 2nd ward, asked about the implications on the City budget, in recognition of the fact that canceling all taxi license fees means less money in the annual budget. About $30,000, answered Mr. Farrar. City expenses are limited to about 50% of the salary of a single City employee tasked with inspecting cabs.

One aspect of the City taxi program that should remain, said several aldermen, is the senior voucher program under which Evanston-registered taxis accept City-issued taxi vouchers for rides. Alderman Delores Holmes, 5th Ward, was among those who said the voucher program should remain a taxi-only program. 

City Manager Wally Bobkiewicz said Evanston taxi medallion owners “want to be protected, but deregulated.” The 140 taxi medallions, once issued by the City decades ago, could be bought and sold on the open market. A medallion could fetch as much as $70,000 years ago, he said, but recently they are “down to $10,000 or $20,000” in value, he said. 

Mr. Bobkiewicz said, “You are deregulating, but you are also protecting,” which presents enforcement challenges. A taxi operating in Evanston without an Evanston medallion can hold up an Uber or a Lyft operator’s application on a cell phone, he said, and avoid a ticket for operating in Evanston. As noted earlier, though, Evanston already permits riders to hail outside cabs by phone or the Internet. 

“We have to be honest – these are competing issues,” said Mr. Bobkiewicz. Deregulating on one hand while enforcing a strict number of taxi operators through the medallion system requires a “thread-the- needle” approach, he said. 

But Ald. Rainey summed up the Council’s goal succinctly, saying the City seeks to “wipe out duplicative [state and City] regulation. That’s the point.” 

Staff agreed to return to Council with a deregulating ordinance preserving the medallion system. Whether the more level playing field will save Evanston taxis from Uber-sized competition remains to be seen.