Ffor over a century, taxi drivers have transported busy New Yorkers to work, brunch, or home after a night out. A symbol of the city made world famous in countless Hollywood films, the drivers of these yellow taxis are mostly immigrants and people of color.
Driving a taxi in New York City has been a lifeline for immigrants and their families to earn a decent living. But in recent years that has all changed. Today, many are grappling with the burden of life-changing debt after investing in a taxi locket.
A taxi medallion is the physical certificate required to operate a yellow taxi. Once viewed as a valuable asset that guaranteed a comfortable retirement, the value of the locket plummeted, leaving the thousands of drivers who bought a locket in the hundreds of thousands of dollars in debt and financially ruined.
According to the New York Taxi Workers Alliance (NYTWA), the average debt owed on medallions by taxi drivers is $ 600,000.
The tumultuous state of the medallion can be attributed to its artificial swelling. In 1937, New York City created the locket system and limited the number of lockets that could be sold, making it a rare and valuable one. By controlling supply, demand for locket possession skyrocketed among taxi drivers who accepted the city’s promise that a locket would bring them financial stability and a path to fulfill the proverbial American dream.
But the way New Yorkers – and tourists – move around the city has changed, and the locket has lost its value. By 2014, its value had risen to $ 1 million, as those who wanted to finance a locket were also at the mercy of predatory lenders. Today the value is around $ 100,000 and the locket owners are in debt.
The medallion’s decline in value is due in part to the overwhelming demand for ridesharing services provided by Uber, Lyft and Via. Unlike taxi drivers, the drivers of these companies are not subject to strict rules and regulations.
Medallion-owner, or “owner-driver” taxi drivers who spoke to the Guardian say it is yet another injustice imposed on them by the city.
A protest to restructure the NYTWA-run medallion debt has garnered support from progressive politicians, including Senator Chuck Schumer, Congresswoman Alexandria Ocasio-Cortez, State Senator Jabari Brisport and Assembly Member from Zohran Mamdani State.
While the city has pledged $ 65 million over 30 years to a debt restructuring plan, NYTWA and its supporters say it’s not enough. NYTWA proposed its own debt restructuring plan totaling $ 90 million over 30 years, with a city-backed guarantee to reduce all outstanding medallion debt to a maximum of $ 145,000, payable at $ 800 per month.
It remains to be seen whether or not city officials will accept their calls, but what is no doubt is the real difficulty facing yellow taxi drivers and their families. Here are some of their stories.
Dorothy LeConte has a locket debt of $ 558,000, but said her broker has taken it to over $ 600,000 after learning that the city would be restructuring taxi payment plans. She pays $ 2,000 per month on the loan.
Le Conte, once a housekeeper and then housekeeper supervisor at the Waldorf Astoria, entered the taxi industry after hearing about her friend’s positive experience with a locket.
“I saw a woman driving a taxi. Her husband died and left her a locket. She was telling me how awesome it was to have a locket, ”said LeConte. “She even said, ‘Dorothy, if you lose your house, let it go. Hold the locket because with one locket you could have multiple houses.
LeConte refinanced his house and bought a taxi medallion in 1989.
Today, she no longer drives since she put her locket in storage during the pandemic to avoid paying for insurance.
“I hope the city restructures the loan,” LeConte said. “I spent hours working to bring food for my children. They barely see their mother. They say, ‘Mom, we never see you. You choose your medallion rather than us. Look what this town has done to you.
MD “Muhammad” Islam lives in Jamaica Hills, Queens. His loan is around $ 800,000 and her monthly payments are $ 4,000. Islam, a Bangladeshi immigrant who arrived in the United States in 2007, started driving a taxi in 2009.
“City officials, everyone said it was a good investment. That it is “better than action”, “Islam said. “They influenced us to buy the locket. I borrowed money from my friends, my relatives.
He said the only thing preventing him from filing for bankruptcy is the time it takes for a person’s credit to break down after filing for bankruptcy.
” I have a house. I don’t want to destroy my line of credit, ”Islam said. “If I file for bankruptcy, it will take seven years to clear. It will hurt [my kids], too much. I am doing my best to fix the problem and not go broke.
“I have loans with two banks. I tried to negotiate with the banks but they don’t negotiate with me, ”Islam said. “If the payout is around $ 700 to $ 800, then we can do it.”
Dorina Nitescu moved to Flushing in 1983 from Romania. Her husband, a former taxi driver, passed away in 2018, but she still has to pay the $ 200,000 loan on her locket since the broker listed her as a co-debtor.
“We bought this asset 30 years ago,” Nitescu said. “It was a good investment at the time for our retirement.
Now Nitescu only has the locket and hundreds of thousands of dollars in debt. Her only way to make money with the locket is to buy a car and rent it from a taxi driver, but she said she couldn’t afford it.
“We started paying off the loan with the credit card. After [my husband] dead, I had no money for the funeral. The broker said, “I want to help you with all my heart,” but he was a big liar. They stole everything from him.
In desperation, Nitescu and her husband began to attend NYTWA loan rebuilding protests.
“My husband even made all the beautiful signs from the bedroom. He even cut my sheets and said, ‘Don’t worry, we’ll replace this,’ ”Nitescu said. “He had the passion to do this. “
Today, Nitescu attends the protests alone.
“I don’t know my direction. I’m in a big mess, ”she said. “On top of that, I have rent. I am in the last part of my life. I want to fix my life. I feel sorry for myself. We didn’t come here to be rich. Just to make a living. They stole from us.
Erhan Tuncel, 61, got his taxi license in 1998 and bought his medallion in 1999. His monthly payment was $ 3,250 but when his balloon expired the bank increased the monthly payment to $ 3,800. The total amount of his loan is $ 690,000.
“I told them I couldn’t do it, so they came and took the locket. They closed it, so I don’t make those payments, ”Tuncel said. “It was a path for a New York immigrant into the middle class and it was taken away from him.”
Many have found themselves in a similar situation to Tuncel: His income as a taxi driver is not enough to pay off his locket debt, so his lender grabbed him. But without his locket, Tuncel cannot live.
“The current conditions do not justify such large payments. We have been pushed into this situation by people in power, so we want them to correct the situation. “
Tuncel wants his medallion returned, his loan restructured, and his driving the public back.
“It would mean getting my life back,” Tuncel said. “It wasn’t our fault. We want the city to see this and give us back the dignity we deserve.
“It’s a very simple question when you think about it. “