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Council to vote on cab franchise at LAX

Higher fees would be divided between airport and company, which says it has addressed problems detailed in critical 2007 audit.

March 29, 2011|By Patrick J. McDonnell, Los Angeles Times
  • Cabs line up just outside LAX. Taxi customers at the airport would see increased fares if the City Council grants a new 10-year contract to a taxi management firm.
Cabs line up just outside LAX. Taxi customers at the airport would see increased… (Richard Hartog Los Angeles…)

The City Council is scheduled to vote Tuesday on whether to grant a new 10-year contract to a firm that has coordinated taxicabs for years at Los Angeles International Airport but was accused in a 2007 city audit of mismanaging funds and other irregularities. Taxi customers at the airport would see increased fares if the new deal is approved.

Under the terms of the proposed concession pact, the surcharge that taxi clients pay for rides from the airport would increase from its current level, $2.50 per trip, to $4. The fee provides revenue for LAX and the taxi management firm, Authorized Taxicab Supervision, which assigns taxis to terminals and manages an airport-area holding lot.

According to official estimates, the new deal would net LAX an almost fourfold increase in revenues — from the current payout of $700,000 per year to an average of $2.7 million annually during the 10 years of the contract. The new contract would start April 1.

Earlier this month, the Board of Airport Commissioners approved the new 10-year contract for the taxi firm, which has been at LAX for more than two decades. The board acted after receiving assurances from the company that it had corrected irregularities identified in the scorching 2007 audit by the city controller's office. The proposed new contract now goes before the City Council.

The Los Angeles Taxi Workers Alliance, an advocacy group, contends that the taxi firm continues to have questionable finances and treats drivers poorly, providing inadequate facilities and sometimes banning cabdrivers from the airport without sufficient cause. According to the alliance, more than 3,000 cabdrivers work from the airport. Cabs make about 1.3 million trips annually from LAX, according to city estimates.

"We are very upset and deeply disappointed that the city is again rewarding corruption," said Hamid Khan of the Los Angeles Taxi Workers Alliance, who called for a criminal investigation into alleged wrongdoing by the firm. "Corruption again gets rewarded and passengers end up paying more from their pockets."

Behzad Bitaraf, general manager of Authorized Taxicab Supervision, did not return a telephone message seeking comment.

Airport officials expressed assurances that the firm had corrected the shortcomings identified in the 2007 audit, said Michael Molina, deputy executive director of external affairs at LAX.

"We are confident those problems have all been cleared up," Molina said Monday.

The firm was selected as the best qualified in a bidding process involving three other competitors, Molina said. The bids were evaluated on a number of criteria, Molina said, including financial return for the city.

The airport agency has also improved its oversight procedures, Molina said. The controllers' office criticized the agency for failing to monitor the taxi management firm adequately.

The audit found, among other things, that the taxi concern had made questionable payments to cab company managers, lawyers and contractors. The audit also found that the firm paid money to employees who were supposedly hurt on the job, but never filed paperwork required by state regulators.

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