Twenty members of the New York City city council earlier this month urged Mayor Bill de Blasio to support a plan to help taxi medallion owners saddled with loans that were once owned by the National Credit Union Administration.
“The collapse of our City’s Medallion market, properly understood, should and will be remembered as one of the greatest government failures in the history of New York City,” the members, including Ritchie Torres, who earlier this year tried to put together a public-private partnership to help drivers wrote.
They added, “After buying an asset because they had a guarantee from the City about its underlying value, our city failed these small business owners. Both the financial and human toll brought on by this crisis cannot be overstated.”
The council members asked the mayor to help revive a plan to act as a guarantor for the taxi owners who owe hundreds of thousands of dollars on their loans.
The city lawmakers pointed out that a city council taskforce had recommended such a plan, but that the coronavirus crisis diverted attention away from the issue. They said that if anything, medallion owners have faced even worse financial problems as a result of the pandemic.
The council members asked the mayor’s help in establishing a Medallion Asset Relief Program to reset medallion values at $250,000 and to serve as the loan guarantor. They estimated that the plan would cost the city as little as $20 million over five years.
de Blasio has said in the past that the city could not afford a plan to help the taxi owners and has said that the city needs its own help from the federal government to recover from the coronavirus crisis.
Many of the taxi loans were made by Melrose and LOMTO Federal credit unions. The value of the medallions plunged with the increasing popularity of ride-sharing services. As a result, those credit unions failed and the loans were taken over by the NCUA, which then sold them to Marblegate Asset Management.
A Marblegate spokesperson has said the private equity fund has been working with individual drivers, but the New York City Taxi Workers Alliance has said that more help is needed.