When Mouhamadou Aliyu took out a loan and bought his taxi medallion at an auction back in 2004, the driver viewed the purchase as a “dream come true,” he said.
But as the value of his medallion plummeted, the 47-year-old found himself saddled with expenses and medallion mortgage payments that have left him struggling to make ends meet.
“The dream started becoming a nightmare,” he said.
Aliyu was among around 40 cabbies who asked the city to provide relief for so-called owner-drivers mired in debt at a rally outside City Hall on Thursday.
A New York Times investigation published in May described an industry in “crisis” — detailing a cycle wherein taxi drivers took out loans to buy medallions, only to find themselves dealing with “overwhelming debt” while industry leaders, bankers and other players profited.
Hundreds of owner-drivers have filed for bankruptcy, and the city has seen a spate of driver suicides, including three by medallion owners who were dealing with “overwhelming loans,” according to the Times.
New York City’s government played no small part in creating the crisis, having “pumped up” the taxi medallion bubble before it burst in 2014, Councilman Mark Levine said at the rally.
“We are directly responsible for the inflation of medallion mortgages … and therefore we have a moral responsibility to repair the damage that’s been inflicted on these drivers, and their families, and their communities,” he said.
Levine and the New York Taxi Workers Alliance, the union that represents many of the city’s thousands of owner-drivers, are asking the city to buy medallion mortgages from lenders and then refinance them “on favorable and fair terms that reflect the realities of the market today,” he said.
He and the Alliance also want the city to provide attorneys for owner-drivers dealing with foreclosure proceedings and to create a retirement fund for those whose debt would leave them unable to stop working otherwise.
The average outstanding debt for owner-drivers is $600,000, with average monthly loan payments close to $3,000, the alliance’s executive director Bhairavi Desai said at the rally. The alliance hopes to see monthly mortgage payments capped at $900.
“We’re sick and tired of owner-drivers and their families being the only ones to bear the brunt of this bubble bursting,” she said. “The people who created it in the first place? It’s time for them to pay up.”
While the city recently released its own report that outlined the “significant financial challenges” owner-drivers face and offered recommendations for relief, Levine maintained the report, “while very important, only focuses on understanding what went wrong and preventing the next crisis.”
“It does nothing to relieve the pain of the thousands of owner-drivers who are already suffering,” he said.
Mayor Bill de Blasio said: " … [W]e’re going to do everything we can to help all drivers to address their financial reality, to renegotiate their debt, if that’s what will help them, or get mental health services, if that’s what they need — whatever we can do to help them within our power, we will.
"In terms of the question of the bailout — the honest truth is, it’s something we can’t reach. We do not have the capacity as a city to provide that. I wish we did, but we don’t — that’s just the truth."