The New York City Taxi and Limousine Commission unanimously approved a deal to restructure taxi medallion debt for cabbies with their largest lender Wednesday.
The panel’s Sept. 28 vote makes official a proposal to give long-sought relief to a large share of holders of the taxi licenses drowning in debt.
The New York Taxi Workers Alliance, which represents about 25,000 members, and Connecticut-based investment firm Marblegate Asset Management, the biggest lender to medallion owners in the city, agreed to a framework in late August, and drivers began applying for the payment structure on Sept. 19.
TLC officials have since logged more than 850 restructured loans resulting in some $200 million in relief, according to Commissioner David Do.
“We have been incredibly successful,” he said during a virtual TLC meeting, “and it is a thanks to all the hard work of not only the Taxi and Limousine Commission, its commissioners, but also our partners, including our lenders and our partner attorneys, and of course the New York Taxi Workers Alliance.”
The deal allows drivers who took out loans with Marblegate — often through the servicing company Field Point — to reduce their debt to $200,000 and get a $30,000 grant as a down payment.
The city also acts as a guarantor in case a borrower defaults, but if that happens the owner is not allowed to invest in a medallion for five years.
The Mayor Eric Adams administration increased the interest rates from an earlier proposal under his predecessor Bill de Blasio from 5% to 7.3% and monthly payments from $1,122 to $1,234, which the TLC’s Do on Wednesday chalked up to inflation and the Federal Reserve hiking interest rates.
Drivers and advocates hailed the move as saving lives of owners of the once coveted medallion licenses, which give the exclusive right to pick up riders hailing down cabs on the street.
The permit’s value was artificially inflated by predatory lenders and city officials until the bubble burst with the arrival of competition from Uber and Lyft, leaving thousands of owners in deep debt, with some resorting to suicide.
Last year, taxi drivers went on hunger strike for more than a month outside City Hall, calling for more help from the city, and de Blasio agreed to expanding his so-called Medallion Relief Program to meet their demands.
“We are starting to see the end of the tunnel. I mean, I’m so excited,” said Mouhamadou Aliyu, a cabbie of more than two decades, during the hearing. “I went all over to beg for mercy, to ask for help and then here I am, you guys are throwing a saving life vest to me and my children.”
The Taxi Workers Alliance’s executive director said she had seen the “life-changing” effects on drivers who poured into the organization’s Queens offices in recent weeks to apply for the program.
“All the sacrifices that people made, because the money was no longer left on the table — for food, and shelter, and education, and health care — was instead going to pay for high mortgages and predatory loans, is now going back into the hands of our families,” said Bhairavi Desai.
“We met members who had gone homeless had been living in the back of their cabs over several years, who talked about being able to have stable housing again,” she added.
Marblegate borrowers have until this Friday, Sept. 30, to come to the Alliance’s 31-10 37th Ave. offices in Dutch Kills to avail of the deal, according to Desai.
She estimated that some 1,500-2,000 medallion owners had debt with that firm, and another 1,000 are with other companies that her organization will work with to process through the end of the year.
“Marblegate has really helped lead the way to bring the financial community to the table,” Desai told amNewYork Metro. “I think it’s given confidence to the rest of the industry that the program is real and literally bankable.”