Wil Andruschak

Every decision that we make about taxis in this town is absolutely ass-backwards,’ says Voters for Taxis co-founder Karen Cameron, pictured here with co-founder Sandy Jenkins

A long-standing cap on the number of taxis in Calgary has created a dysfunctional system whereby cab drivers are raking in up to $140,000 by legally selling licences originally bought for about $100, according to the former manager of the city’s taxi department.

And while that price tag is lower than it is in cities like New York (where city cab licences sell for over $400,000) and Winnipeg (over $200,000), Karen Cameron of advocacy group Voters for Taxis says Calgary needs to overhaul its taxi system.

“Those licences, really, should just be about providing service, but they’ve become part of an investment portfolio for people that aren’t even in the industry anymore,” says Cameron, who managed the city’s Livery Transport Services department until 2007 and then co-founded Voters for Taxis. “Those business licences are entirely disconnected from the provision of service…. Every decision that we make about taxis in this town is absolutely ass-backwards.”

Cameron says that when she left the city in 2007, drivers were transferring licenses to each other for about $50,000. Since then, she’s heard of licences fetching $140,000. “The more those licences go up in value, the harder-pressed a driver is to earn a living. They’re more pressed to give short shrift to their existing customers and try to dash off to the next one.”

Cameron’s group bills itself as a voice for taxi customers and is calling on the city to lift the cap on taxi licences — the number of licences hasn’t significantly increased in more than two decades — to meet customer demand. But the suggestion irks cab companies. (Companies hold about just over half of the 1,411 Calgary licences, while drivers own the remaining ones.) “I think it’s a bad idea to just open it up like that,” says Len Bellingham, owner of Mayfair Taxi Ltd. and chairman of the Calgary Livery Association. “Deregulation would cause chaos.”

The licences’ value has slowly increased since 1986, when the city capped the numbers at 1,311. At the time, the city had too many cabs and taxi drivers called for a licence cap so they could eke out a living. The cap has been in place ever since (with the exception of 100 accessible taxi licences added in 2006), but the city’s population has grown from less than 650,000 to over one million, creating a cab crunch — especially at peak hours, when customers face repeated busy phone signals and long wait times.

“You have to regulate taxis because it’s in the public interest to regulate taxis, but you don’t come up with a number in conjunction with the industry and then stick to that number for 23 years,” says Voters for Taxis co-founder Sandy Jenkins. “That’s just insane. You wouldn’t do that with restaurants or hair salons.”

A February report put out by the Frontier Centre for Public Policy says that if taxi numbers increased with the population, there would be almost 2,500 cabs in Calgary instead of 1,411. “The business model that Calgary operates under doesn’t deliver service,” says Cameron. “No other business is organized in this way.”

Heather Douglas, CEO of the Calgary Chamber of Commerce, says the cab shortage during peak hours is frustrating. “The number of taxis should meet the demand,” she says. “Our members are having trouble understanding, when the city has grown 40 per cent, why in the last number of years we’ve only had 100 new taxis.”

Marc Halat, the city’s manager of Livery Transport Services, says it’s up to city council to remove the taxi cap if it chooses to do so. He concedes that the licence “black market” is “silly,” but points out that similar markets exist in many cities and changing that system would be challenging. “There are pros and cons. The pros are ‘Hey, you don’t have to worry about getting a taxi.’” But removing the cap, he warns, could hurt cab drivers. “If it was an open-entry system, someone’s going to suffer for it financially. And I don’t think you’re going to get the quality of driver because you’ll lose the interest if you can’t make the money.”

Voters for Taxis recently conducted an online survey about taxi service in Calgary and the city has now posted a survey of its own to gauge customer satisfaction. It’s a way “to allow the public to vent,” says Stephanie Ho Lem, chair of the city committee that advises council on taxi issues. Associated Cab owner Roger Richard, the committee’s vice-chair, recently told the committee that the city survey will get the “real result — not the imagined result or the calculated result or what have you.”

The city is also reviewing its taxi bylaw and plans to make minor tweaks. “The bylaw is working,” says Halat. “We’re fine tuning that bylaw to make it more efficient.”