Sullivan County Democrat
Callicoon, New York
April 10, 2012 Issue
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Judge: Monticello’s taxi law may harm existing cab companies

By Dan Hust
MONTICELLO — Sullivan County Supreme Court Judge James Gilpatric has extended an injunction against the Village of Monticello until a lawsuit over its new taxi law is settled.
A year ago, the village board in a split vote approved opening up the cab system to any interested operators. For decades prior, that had been limited to only those who possessed one or more of the village’s taxi medallions, each of which allows one taxi to ply Monticello’s streets.
This law kept the medallions but dropped that cap, and the existing medallion holders – Yellow Cab’s Alan Kesten and Sureway Taxi’s Gary Putter – cried foul.
They took their concerns to court and gained a temporary injunction, preventing the village from enacting the law.
On August 23, Judge Gilpatric in essence made that injunction permanent “pending further order of this court.”
But he also indicated he finds merit in the taxi companies’ argument that the law was adopted arbitrarily and will harm their monetary interest in the medallions.
Gilpatric agreed that the law was adopted without a SEQRA (State Environmental Quality Review Act) review, indicating (but not outright stating) such a review should have been done, as it would have addressed impacts on traffic and air quality, among others.
But he seemed most moved by Putter’s affidavit, which stated that Putter paid $30,000 apiece for five medallions in 2005 in order to start service in Monticello. (The medallions originate with and are regulated by the village, but prior holders have been able to sell the medallions to other operators.)
As the new law would charge only $200 to obtain a new medallion, Gilpatric noted that the value of the current medallions would be “virtually wiped out.”
As a result of these issues, he felt harm to the cab companies is possible and indicated the court may ultimately rule in their favor.
“The court finds that the petitioners-plaintiffs [the taxi companies] have established a substantial likelihood of success in the action,” Gilpatric wrote in his judgment, “in that the village board has failed to conduct a SEQRA review necessary to determine whether or not any environmental issues are associated with the adoption of the local law.”
Kesten couldn’t be reached for comment, but Putter felt this ruling was significant and possibly precedent-setting statewide.
“It comes pointedly close to giving taxi owners a vested right in their medallions,” he said. “It shines a very positive light on our issues.”
Monticello Mayor Gordon Jenkins felt differently, arguing that his administration had surveyed the community about the need for more taxis before the law was adopted.
“I stand firm that taxis are much-needed here,” he stated. “People wait for cabs here, and I’ve always said, ‘How can someone monopolize a business here?’”
Though as of Wednesday Jenkins had not yet seen Gilpatric’s decision, he hoped the court will ultimately decide to open up the village to more competition.
Without that competition, the cab companies won’t feel pressured to upgrade their equipment and services, Jenkins argued, and the village will suffer as a result.
“Why is everyone so afraid to let someone come in?” he wondered.
Putter argued that the medallion system does not snuff out competition, pointing out that he provides a competing service against Kesten’s Yellow Cab.
“That was the issue that brought me into the village,” Putter said, referring to calls for more taxi service. “... There is competition in the village.”

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