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UN City of Fort Worth, Te; ,s
MAMIH
OWN Mayor and council Communication
DATE REFERENCE SUBJECT: Ordinance Amendment for Fort PAGE
NUMBER Worth Cab and Baggage Company 2
11/10/75 G-2877 1 of
The Fort Worth Cab and Baggage Company has requested an extension and renewal
of its present franchise from January 1, 1976, to December 31, 1985. The
Company has also requested assistance in obtaining financial relief from the
effects of declining ridership and rising fuel costs. Fort Worth Cab and
Baggage showed a loss of $7,960.53 for its year ending January 31, 1975, and
a deficit of $25,716.35 for the 6 months period ending August 31, 1975. The
Company is continuing a loss in passengers and trips which amounts to about
10.5 per cent annually.
The decline in ridership has been brought about by several factors. Improved
bus service, including free bus service downtown, has had some impact. Other
competition has come from service operated on a contractual basis to trans-
port welfare recipients by a carrier, Transportation Enterprise, which is
subsidized through grant monies administered through the local Fort Worth
Council of the Churches.
The single most important factor affecting the financial condition of the cab
company, however, is the cost of' gasoline. Company records show the cost of
gasoline in the period from January 1, 1974, to September 11, 1975, went from
26.1c per gallon to 46. 6c per gallon or an increase of 78 per cent.
The Company has requested two means to assist them in relieving their financial
problems. The first request is to eliminate the street rental payment. The
second request would be for permission to apply a gas surcharge on a cost pass-
through basis per trip to the passengers in proportion to increased costs for
gasoline each month. This is equivalent to an automatic fare increase corres-
ponding to increased gasoline prices.
The staff recommends disapproval of the request for a pass-through and automatic
fare increases based on gasoline price increased due to the resultant loss of
control over fares.
Relief from the requirement that the company pay 1 per cent of their gross
receipts to the City of Fort Worth would cost the City approximately $12,000
in revenue per year. Fort Worth Cab and Baggage pays approximately $9,000 per
year, while another $3,000 is generated by the United Cab Company. The Fort
Worth Cab and Baggage Company's present contract was entered into in March
of 1965, and in Ordinance No. 5343, one of its provisions required a street
rental payment of 3 per cent. This was complied with by both companies until
1972, when they began experiencing financial difficulties, at which time the
City Council reduced the gross receipt payments from 3 per cent to 1 per cent.
Staff has met with representatives from the Company to discuss alternatives
for paying for the increased price of fuel. It was reluctantly determined that
immediate relief could be obtained from an increase in fares. Longer term
assistance is being considered through the use of Federal transit funds , if
such can be made legally available.
DATE REFERENCE SUBJECT: Ordinance Amendm._.it for Fort PAGE
NUMBER Worth Cab and Baggage Company 2 2
11/10/75 G-2877 of
It was determined that assistance to the Company would be to allow the Company
an increase in the initial basic charge for service, adding that amount to each
trip. This appears to be the most feasible means of providing rate and revenue
relief while at the same time minimizing the hardship on users of taxicabs.
The steps through which the taxi meters are now geared operate in 1/6th mile
incremental units, and the next step would be to go either to 1/7th mile or
1/8th mile units. If the "flag drop" or initial step itself is permitted
to be increased, this would require no additional major meter-part change-out,
and the taxi meters and fleet would not have to be reinspected and recertified
by the City.
For the year ending June 30, 1975, 344,753 passenger trips were made, a
decrease of 10.54 per cent from the previous year. Assuming that this trend
will continue at the same rate and with an estimated 15 per cent loss of
ridership due to higher fares, the annual passenger trips would be adjusted
to 329,000 (a decrease of 25.5 per cent) . With an increase of 15c, the
amount generated would be approximately $48,000. Out of these additional
proceeds the drivers; who work on a 42 per cent commission, would receive
some $20,000 and the Company would retain approximately $28,000.
The current charge for taxi service is 75C for the first 1/6 mile and 10c
thereafter. A 15c increase for the first 1/6 mile is proposed, with no
charge in the rate for the subsequent 1/6 mile increments. In addition, a
maximum annual payment of $1,000 for each taxicab company for a street rental
fee would be desirable over complete elimination of the fee. If taxi business
improves, examination of maximum limitation may be possible at some future
time.
Recommendation
It is recommended that the City Council extend the Fort Worth Cab and Baggage
•
franchise permitted by City Ordinance No. 5343 from January 1, 1976, to
December 31, 1985. It is also recommended that the Council approve an increase
in the basic drop fee from 75c to 90c and the establishment of a maximum
payment of $1,000 for each taxicab company the street rental fee, retaining
the 1 per cent street tax now levied.
RNL:ms
SUBMITTED BY: DISPOSITION BY COUNCIL: Pi/� Y
�PPROVED THER (DESCRIBE)
�/f �1 �� � � � �� , 7- f 1 4 .s • CITY SECRETARY
• pf ? ' DATE A I' 2
CITY MANAGER /