Greater N.Y. Taxi Ass'n v. State

• Decision Date: 06 June 2013
• Citation: 970 N.Y.S.2d 907,993 N.E.2d 393,21 N.Y.3d 289,2013 N.Y. Slip Op. 04044
• Parties: GREATER NEW YORK TAXI ASSOCIATION et al., Respondents, v. STATE of New York et al., Appellants, and Livery Base Owners Inc. et al., Intervenors–Appellants. Taxicab Service Association et al., Respondents, v. State of New York et al., Appellants, and Livery Base Owners Inc., et al., Intervenors–Appellants. Metropolitan Taxicab Board of Trade et al., Respondents, and The Livery Roundtable, Inc., et al., Intervenors–Respondents, v. Michael R. Bloomberg, as Mayor of the City of New York, et al., Appellants, and Livery Base Owners Inc., et al., Intervenors–Appellants.
• Court: New York Court of Appeals Court of Appeals

21 N.Y.3d 289

993 N.E.2d 393

970 N.Y.S.2d 907

2013 N.Y. Slip Op. 04044

GREATER NEW YORK TAXI ASSOCIATION et al., Respondents,

v.STATE of New York et al., Appellants,andLivery Base Owners Inc. et al., Intervenors–Appellants.

Taxicab Service Association et al., Respondents,

v.State of New York et al., Appellants,andLivery Base Owners Inc., et al., Intervenors–Appellants.

Metropolitan Taxicab Board of Trade et al., Respondents,

and

The Livery Roundtable, Inc., et al., Intervenors–Respondents,

v.Michael R. Bloomberg, as Mayor of the City of New York, et al., Appellants,andLivery Base Owners Inc., et al., Intervenors–Appellants.

Court of Appeals of New York.

June 6, 2013.

Michael A. Cardozo, Corporation Counsel, New York City (Scott Shorr, Leonard J. Koerner and Francis F. Caputo of counsel), for Michael R. Bloomberg and others, appellants in the first, second and third above-entitled actions.

Eric T. Schneiderman, Attorney General, New York City (Richard Dearing, Barbara D. Underwood, Andrew W. Amend and Claude S. Platton of counsel), for State of New York and others, appellants in the first and second above-entitled actions and intervenor-appellant in the third above-entitled action.

Greenberg Traurig, LLP, New York City (Stephen L. Saxl, Israel Rubin and Ryan F. Harsch of counsel), for Livery Base Owners Inc. and another, intervenors-appellants in the first, second and third above-entitled actions.

Mintz & Gold LLP, New York City (Steven G. Mintz and Lisabeth Harrison of counsel), for respondents in the first above-entitled action.

Gibson, Dunn & Crutcher LLP, New York City (Randy M. Mastro, Akiva Shapiro, Paul Kremer and Seth Rokosky of counsel), for respondents in the second above-entitled action.

Emery Celli Brinckerhoff & Abady LLP, New York City (Richard D. Emery of counsel), for respondents in the third above-entitled action.

The Shanker Law Firm, P.C., New York City (Steven J. Shanker of counsel), and Davis Wright Tremaine LLP (Robert Balin of counsel) for intervenors-respondents in the third above-entitled action.

Office of the Manhattan Borough President, New York City (Andrew L. Kalloch of counsel), for Manhattan Borough President Scott M. Stringer in the first, second and third above-entitled actions, amicus curiae.

OPINION OF THE COURT

PIGOTT, J.

At issue on this appeal is the constitutionality of chapter 602 of the Laws of 2011, as amended by chapter 9 of the Laws of 2012 (“HAIL Act”), which regulates medallion taxicabs (or “yellow cabs”) and livery vehicles, vital parts of New York City's transportation system. The Act's stated aim is to address certain mobility deficiencies in the City of New York, namely: the lack of accessible vehicles for residents and nonresidents with disabilities; the dearth of available yellow cabs in the four boroughs outside Manhattan (“outer boroughs”), where residents and nonresidents must instead rely on livery vehicles; and the sparse availability of yellow cab service outside Manhattan's central business district ¹ and the two Queens airports, locations where close to 95% of yellow cabs pick up their customers ( see Sponsor's Mem., Bill Jacket, L. 2012, ch. 9).

I

Because the HAIL Act arguably affects the yellow cab and livery vehicle enterprises in significant ways, we first address the traditional distinctions between them before addressing the substance of the Act itself. Both enterprises are regulated by the Taxi and Limousine Commission (TLC), but are subject to different rules of operation.

Yellow cabs operate under a transferable license or medallion, which is a numbered plate issued by the TLC that is affixed to the outside of a taxicab as physical evidence that the taxicab has been licensed to operate as a medallion taxicab ( see 35 RCNY 51–03). These cabs are metered vehicles that must charge uniform rates ( see Administrative Code of City of N.Y. §§ 19–502[k]-[1];; 19–514[a]; 35 RCNY 58–38). They possess the exclusive right to pick up passengers pursuant to street “hails” from any location in the City ( see Administrative Code of City of N.Y. § 19–504[a][1] ).

In 1956, the New York State Legislature delegated to the City Council the discretionary authority to register, license and limit the number of yellow cabs, and to establish ordinances and regulations regulating parking and passenger pick-up and discharges ( seeGeneral Municipal Law § 181[1], [2]; see also N.Y. City Charter § 2303[b][4] ).² Prior to 1996, the City Council had capped the number of medallions that the TLC was permitted to issue at 11,787. Between 1996 and 2008, the City Council approved the issuance of 1,450 additional medallions, resulting in a total of 13,237. Given the limited supply of medallions, their value has increased yearly and the competition for obtaining one is fierce. Moreover, according to the TLC, out of the 13,237 issued medallions, only 231 are cabs that are accessible to people with disabilities.

In contrast to yellow cabs, livery vehicles are prohibited from picking up street hails and may accept passengers only on the basis of telephone contract or other prearrangement ( see Administrative Code of City of N.Y. § 19–507[a] [4] ). The livery client contacts a “base station” that dispatches a livery vehicle to the requested location (Administrative Code of City of N.Y. § 19–511). However, this has not prevented some livery vehicles from illegally accepting street hails, where the price of the fare is not regulated. As with yellow cabs, a substantial number of livery vehicles are ill-equipped to provide service to persons with disabilities.

II

Enacted by the New York State Legislature in the latter part of 2011 and the early part of 2012, the HAIL Act creates, among other things, a “HAIL License Program” that calls for the TLC to issue 18,000 “Hail Accessible Inter-borough Licenses” allowing “for-hire vehicles,” ³ i.e., livery vehicles, to accept street hails in the outer boroughs and those areas in Manhattan outside its central business district (HAIL Act §§ 4[b]; 5 [a] ). TLC-licensed yellow cabs retain “the exclusive right ... to pick up passengers via street hail in such areas of the city of New York wherein HAIL license holders are prohibited from accepting such passengers” ( id.§ 11). The Act demarcates these areas—Manhattan's central business district and the two Queens airports—as the “HAIL Exclusionary Zone” ( id.§ 4[c] ).

Livery vehicles without a HAIL license are permitted to accept prearranged calls from a base station established pursuant to New York City Administrative Code § 19–511 inside the HAIL Exclusionary Zone, while livery vehicles possessing a HAIL license may accept prearranged calls outside the HAIL Exclusionary Zone and at airports ( id.§ 5[f] ). HAIL vehicles, ⁴ however, may not accept prearranged calls within the HAIL Exclusionary Zone ( id.§ 4[c] ). Drivers with a valid HAIL license who accept street hails in areas where such vehicles are not permitted to do so are subject to various penalties ( id.§§ 25, 26; see Administrative Code of City of N.Y. § 19–506[k], [1] ).

The Act calls for HAIL licenses to be distributed in increments of 6,000 over three years, with 20% of the first 6,000 earmarked for accessible vehicles ⁵ ( id.§ 5[b] ). Subject to a “HAIL market analysis,” which the TLC must prepare and submit to the City Council and the New York State Department of Transportation “examining HAIL vehicle rider demand, shortages and the need for adequate and affordable transportation” ( id. § 6), the TLC may issue up to 6,000 HAIL licenses in the second and third years (“second issuance” and “third issuance,” respectively) ( id.§ 5[b] ). The second and third issuances are likewise subject to the 20% accessibility requirement unless the TLC, having conducted a study and issued a report relative to “the accessibility of vehicles with HAIL licenses in the Disabled Accessibility Plan,” ⁶ recommends a different percentage ( id.;see HAIL Act § 10). HAIL licenses issued during the first, second and third years will cost $1,500, $3,000 and $4,500, respectively ( id.§ 5[d] ).

In order to introduce accessible vehicles into the HAIL vehicle fleet, the TLC must launch a program that provides “grants to purchasers of HAIL licenses restricted to accessible vehicles as provided in [HAIL Act § 9(b) ]” or provide “vehicles to purchasers of HAIL licenses restricted to accessible vehicles on affordable and financially feasible terms” (HAIL Act § 9[a][i], [ii] ). HAIL Act § 9(b) provides that “[p]urchasers of hail licenses restricted to accessible vehicles ... shall be eligible to apply for grants” of up to $15,000 to apply toward either the purchase of “an accessible vehicle for use as a HAIL vehicle” or toward “retrofitting a vehicle to be an accessible vehicle,” with the total amount of such grants not to exceed $54 million.

As it relates to yellow cabs, the Act creates an “Accessible Taxicab Program,” which allows the Mayor to administratively authorize the TLC to issue by public sale up to 2,000 taxicab licenses (or medallions) that are restricted to vehicles designated for the purpose of transporting persons in wheelchairs or containing a physical device or alteration designed to permit access to and enable the transportation of persons in wheelchairs in accordance with the Americans with Disabilities Act ( see HAIL Act § 8). The Act states that not more than 400 of such licenses may be issued until the Disabled Accessibility Plan is approved by the New York State Department of Transportation. Moreover, the Mayor's authority to issue these licenses is conditioned upon the TLC making both the HAIL licenses in section 5 of the Act and the “hail privilege vehicle permits” authorized pursuant to section 4 of chapter 602 of the Laws of 2011 available for issuance. These new accessible taxicabs will possess the exclusive right to pick up passengers via street hail from any location within the city of New York where HAIL license holders are prohibited from...