Taxicabs of New York City - Medallion Taxicabs and Livery Taxicabs

Medallion Taxicabs and Livery Taxicabs

Only "medallion taxicabs," those painted in distinctive yellow and regulated by the TLC, are permitted to pick up passengers in response to a street hail. The TLC also regulates and licenses for-hire vehicles, known as "car services" or "livery cabs," which are prohibited from picking up street hails (although this rule is less often enforced in the boroughs outside Manhattan) and are supposed to pick up only those customers who have called the car service's dispatcher and requested a car. Following state legislation passed in 2011, the TLC voted in April 2012 to allow livery cabs to be licensed to make street pick-ups in the outer boroughs and northern Manhattan, a rule scheduled to take effect in the summer of 2012.

While medallion taxicabs in New York are always yellow, car service vehicles may be any color but yellow, and are usually black. For this reason, these taxi operators are sometimes called "black car" services. Despite the de jure prohibition on picking up passengers who hail on the street, some livery cabs nevertheless do so anyway, often to make extra money. When a livery cab engages in street pick-ups, it becomes known as a "gypsy cab." They are often found in areas not routinely visited by medallion cabs, and authorities tend to turn a blind eye to the practice rather than leave sections of the city without cab service. The use of gypsy cabs is strictly at the rider’s risk, and it is recommended that passengers negotiate a fare with the driver before entering, as the cabs are not equipped with meters, and fares are not regulated by the TLC. The driver also is taking a risk that the passenger will leave without paying.

Medallion taxicabs are named for the official medallion issued by the TLC and attached to a taxi’s hood. The medallion may be purchased from the City at infrequent auctions, or from another medallion owner. Because of their high prices (often over $700,000) medallions (and most cabs) are owned by investment companies and are leased to drivers ("hacks"). An auction was held in 2006 where 308 new medallions were sold. In the 2006 auction, all medallions were designated as either hybrids (254) or handicap accessible (54) taxis. In October 2011, due to the longtime trend in the medallions' supply and demand, auction prices first topped $1 million.

By comparison, in 2004, a taxi driver had an average yearly gross revenue of $90,747 and a net income of $49,532.