Taxicab Concessions

High-tech, high-level wheeling and dealing makes all of us fare game

But Schaller also acknowledged that he has worked for Sherman's group, the Metropolitan Taxicab Board of Trade, helping the fleet owners evaluate their street service and preparing arguments for the 2004 fare hike. Schaller said his past ties to the bidders had had no impact on his performance during the proposal evaluation. "The projects I did for various private-sector people were all prior to even the RFP for the enhancement project, so there is no conflict of interest," he said.

As it happened, the city's Department of Investigation never examined Schaller's ties to the fleet owners' trade group, but it did scrutinize his ties to Taxi Technology. It found "no misconduct."


But Thaler wasn't the only would-be bidder seriously troubled by the process. A British firm, Cabvision, whose credit card and wireless communications equipment is already operative in 1,000 London taxis, was ruled ineligible when its proposal arrived a few hours after the deadline. Like Thaler, Cabvision had been working with city officials long before the request for proposals was issued, and as in Thaler's case, its executives noted that their suggestions appeared to have been incorporated directly into the city's proposal request documents.

Cabvision CEO Peter DaCosta wrote in an e-mail to the Voice that he had pushed up to the deadline to acquire enhanced communications technology and the backing of a hedge fund that would allow Cabvision to install its systems in New York City cabs for free—just as it currently does in London taxis.

DaCosta said he was assured by a top TLC official that it wasn't necessary to fly over to deliver the proposal personally, as long as the package was postmarked by the deadline. When city officials later rejected his firm's proposal as unacceptably late, DaCosta appealed—citing the erroneous assurance he'd received. The appeal was denied.

"They were told, in no uncertain terms, that you have until Monday noon to get this proposal before us," said agency spokesman Fromberg. "We would have preferred to have had their proposal to consider."

That might have been the end of things for Cabvision's ill-fated attempt to penetrate New York's tight taxi industry, but the klutzy performance by top taxi agency officials continued. Taxi commission records show that even after his appeal was denied, DaCosta sent Daus a sportsman- like note thanking him for the chance to participate in the process and asking that his proposal package—"which I hope was unopened," as DaCosta wrote—be returned forthwith. No such luck.

An investigation by the Mayor's Office of Contract Services later determined that a mailroom clerk at the taxi commission initially opened the proposal by mistake (a violation of city procurement rules, since proposals contain valuable, proprietary information). Realizing it was an RFP response, the clerk delivered it to the office of Louis Tazzi, a veteran city aide who is currently a deputy commissioner at the taxi agency and serves as its chief contracting officer. Despite rules forbidding the examination of a rejected proposal, Tazzi told investigators that he noticed that Cabvision's pricing proposal, which had been in a sealed envelope, had been opened. So, "out of curiosity," as he later told the investigators, he read it. Tazzi, however, swore he never discussed it with anyone.

Things got worse. Although no one ever determined who originally opened Cabvision's original pricing proposal (testimony by agency employees was deemed "contradictory" by city officials), it later disappeared. At one point, an independent city consultant who was overseeing the RFP evaluation procedure acknowledged that he had moved Cabvision's proposal out of a secure cabinet to a cabinet where the other, previously accepted, proposals were kept—another rules violation. The consultant later offered the same explanation as Tazzi for his actions: He was curious.

Despite this Keystone Kops routine by top figures at the taxi agency, the rules violations were later examined by the Mayor's Office of Contract Services and deemed to be "inadvertent" and "de minimis," amounting to a "minor rules violation"—which meant the selection process could proceed. DaCosta, however, said he's still concerned. Despite repeated requests, the taxi commission still hasn't returned his rejected proposal.


All of the winning bidders declined to comment on the process, pointing to a gag order contained in the RFP rules that precludes them from discussing their products or efforts until after the comptroller registers the contracts. A spokesman for one of the approved vendors, an old hand at the mud wrestling that often accompanies the pursuit of city work, scoffed at the objections raised by the disqualified bidders. "You know you get one of these in every bid," he said. Reminded that he has often griped about agency slights to his own clients, he added, "OK, sometimes there are real problems."

One of those real problems occurred back in 1984 when a woman named Barbara Myers, the owner of a small taxi fleet, complained publicly that the then taxi commission chairman, a product of Brooklyn's Democratic clubhouses named Jay Turoff, had steered a lucrative experimental program offering extra medallions for cabs using diesel fuel to a pal, the owner of one of the city's largest taxi fleets.

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