Fare Fight

The pending sale of Roy's Taxi company raises a host of Austin memories

Mariam Nwoko (center), President of United Cab Drivers Association, flanked by fellow Roy's drivers.
Mariam Nwoko (center), President of United Cab Drivers Association, flanked by fellow Roy's drivers. (Photo By Jana Birchum)

Lately, Mariam Nwoko has been doing more than shuffling her regulars back and forth across town. That's hard enough; the AC in her van, one of 155 cabs in Roy's Taxi's sea-foam green fleet, is on the fritz, and the Texas heat is already here. But she's also steering something greater: the United Cab Drivers Association, which she formed in opposition to a proposal she fears will drive many local cabbies out of the business – the sale of Roy's Taxi's franchise, including both the cabs and their all-important city permits, to competitor Yellow Cab Company. With 304 cars, Yellow is by far the biggest taxi company in town. Nwoko fears the purchase of Roy's fleet – the second largest – will give Roy's drivers no choice other than to swallow Yellow's steeper lease and operator fees.

Initially, the transfer looked to be in trouble. When the proposed ordinance allowing the transfer came before the Urban Transportation Board in April, it was unanimously rejected. Considered by City Council in early May, however, it passed on first reading, a temporary formality – over the objections of dozens of drivers, who lit up the council chambers with vociferous objections until 1am. On May 25, the council gave its second approval, by a more tentative 5-2 vote. Today (Thursday), the matter returns for all-but-assured passage on third and final reading; a 60-day wait follows before the changes are implemented. In allowing the sale, council and the city argue that Roy's, its franchise recently renewed, legally can do what it wants with the business, and, effectively, the permits as well. The Association recently countered, filing a lawsuit alleging the transfer violates antitrust laws aimed at preventing monopolies.

Even if by some twist of fate the proposed transfer isn't finally approved in its current form, the transition marks a turning point in Austin's already complex taxi history. It definitely marks the end of Roy's Taxi's 75-year run of the city as a family business, its gauge slowly easing down to empty. Less than certain is what the end of Roy's Taxi means for Roy's drivers, a motley, hardscrabble family themselves, soon to be scattered across the city.


In Service

Nwoko pilots her cab easily down East Seventh Street toward Austin Bergstrom International Airport. The front of the car is littered with papers, personal effects, and an enormous plastic mug of water and ice. Like most of Roy's drivers, Nwoko owns her vehicle outright – in her case, a well-worn minivan. Nwoko's two years of wear on the ride look more like a civilian vehicle's 10 years, showing all the side effects of the daily demands hacks place on their cabs. "If you drive it for four to five years," says Nwoko of a commercial vehicle's life span, "you did great."

The old saw about spending money to make money is more than doubly true for cabbies. Drivers who lease from Roy's pay up to $400 a week; owning her own ride, Nwoko pays $220 weekly in terminal fees, plus maintenance, bonding costs, and additional surcharges (Roy's takes 10% of credit card purchases, voucher fares, and Capital Metro-financed Special Transit Service fees for disabled passengers). But her greatest expense, unsurprisingly, is gas. Nwoko runs through two full $40 tanks a day, which brings a 40-hour workweek cost to $400. Recently, the city allowed a 10-cent gas surcharge per mile, but Nwoko says the increase is too small to keep pace with rising prices.

After all the fees are lumped together – around $775, says Nwoko – and deducted from her gross fares, a Roy's hack takes home about $400 a week, in high season. And that's not this one. "We're going into the slow season," Nwoko says. With students and citizens leaving the city for vacations, the summer travel season doesn't shine on cabbies – only the increased gas prices. "It's real slow from the end of May until September," she says. "If drivers take $300 home [a week] in the summer, they've done great." For drivers who rely primarily on airport fares for their livelihoods, Nwoko says, Yellow's higher terminal fees will likely be insurmountable.


Radio War

Yellow Cab President Jim Connolly
Yellow Cab President Jim Connolly (Photo By Jana Birchum)

Arriving at the airport, Nwoko drives headlong into a river of taxis. It's the holding queue beside the airport, where cabs pool in a long line before traveling to passenger pickup. Tonight there are 80 or more, many with doors open and hatchbacks up – waiting. On the covered island to the side of the lanes, a dozen or so cabbies, several with varying African accents, talk loudly over a stainless steel table; a debit card machine, installed to streamline payment of the dollar surcharge the city charges airport cabs, sits broken; a weather-worn television broadcasts flight arrivals above the restroom doors. It's a harsh, feverish place, like a muddy watering hole in drought season. "You burn up out here in the heat," says Nwoko. "In the winter, you freeze to death. This whole environment is bad for your health." Looking to the lanes, she estimates the wait for a fare this warm weekday at 21/2 hours. During peak travel times and weekends, there are more customers, but also many more cabs – so the wait can stretch above four hours.

It's a service served, primarily, by Roy's and Austin Cab. There's a noticeable dearth of Yellow taxis; of the approximately 80 cabs waiting, perhaps a dozen are from the larger company. "Yellow doesn't service the airport," says Nwoko, "because the wait times are too long." Due to its higher fees, she says, "You can't work for Yellow Cab [and] come here and sit all day." An aviation control officer, overseeing the checkpoint clearing cabs into the terminal pickup, concurs. "It's hard to get them out here at night," he says.

Yellow Cab president Jim Connolly says there's less incentive for his drivers to wait when they can pick up fares elsewhere much more quickly. Unlike its smaller competitors, Yellow utilizes what Connolly calls a "fully computerized, digital dispatch system." When a fare dials Yellow, the call is input into the system; a computer then sorts cabs by area and wait time, sending the appropriate car. "It increases the flow of service requests, the amount handled, and cuts the need for human interface and error," Connolly says. "The majority of our calls are never touched by human hands [after the initial phone call]. ... For many drivers, it's a more productive use of their time to take [computerized] requests." (At least one Yellow driver, who prefers to remain anonymous, disagrees, and says the company's dispatch system is so overloaded "it crashes like every other week.")

Connolly admits his company charges its drivers more than Roy's but says Yellow drivers receive a wealth of additional services. The steeper terminal costs ($270 a week compared to Roy's $220) and lease fees ($90 a day vs. Roy's $400-a-week average) apply not only toward Yellow's advanced radio system but toward damage-insurance coverage. Unlike its competitors, Yellow covers all damage costs after a $1,500 co-pay from the driver. Additionally, Yellow sets up a maintenance-costs account for drivers; the company pays 10% interest when the sum reaches above $1,500. And in some instances, Yellow charges less than Roy's: half of Roy's 10% credit card surcharge, and no percentage of STS fares.

Back at the airport, Roy's employee Ray Castro says the company's dispatch system is inadequate. Dispatchers first send out a call for fares at a general location, such as cross streets. Once a cab's in that vicinity, the dispatcher delivers the exact address, but drivers like Castro are frustrated by the lack of specifics. "That's why a lot of drivers don't use the radio [relying instead on airport fares]," Castro says. "I utilize it because I have my recorder," he says, pointing to his rearview. He pushes a button, and a string of lights and voices are summoned – a device mounted there records the dispatcher. Like he is of his striking forest-green upholstery, or his special brand of service, he's proud of his recorder. "Thursday, Friday, and Saturday night, I give ladies flowers," says Castro, who looks a bit like a diminutive Jimmie Dale Gilmore. "During the week, I give out bubble gum." He's only driven for two years but feels completely at home. "To me, this is not a job. I love this. I got a degree in accounting, but I don't like that corporate world ass-kissing."


The Checkered Past

The radio gap between the companies illustrates an unspoken truism – in recent years, while Yellow Cab's business has steadily increased, Roy's service has been in decline. That doesn't help driver advocates when they lobby the City Council. And while drivers like Nwoko and Castro, and the majority of Roy's cabbies, are simply hard workers struggling to make ends meet day-to-day – due to a couple of unfortunate, high-profile incidents, the image of Roy's as a company has acquired some tarnish over the years.

Founded by Roy Velasquez Sr. in 1931, Roy's Taxi is the oldest cab company still servicing Austin. According to a company history posted online, Mr. Velasquez created the company to service Austin's black and Latino citizens, who were denied taxi service due to discrimination. The company's open-arms approach extended to its drivers. "In 1967, Roy's hired its first hippie driver, and the complaints rolled in," reads the site. "But as the years went by, Roy's continued to hire people who were of different races and different beliefs, without having to sacrifice business." The company has always had a relatively rough-hewn, freewheeling image among both drivers and the Austin public, as being somewhat less polished but simultaneously more easygoing than larger companies. (The company reputation took a darker turn in recent years, after the 2000 murder of two passengers by a Roy's driver.)

Fare Fight
Photo By Jana Birchum

So the pending sale carries with it some flavor of an older, funkier Austin stepping reluctantly aside to give way to a newer, shinier, perhaps more efficient, but less homegrown corporate veneer. A bit of that cultural transition is also coloring the public debate.

Upon Roy's death in 1981, ownership was passed to his five sons: Carlos, Gilbert, Richard, Robert, and Roy Jr. There have been persistent murmurs that some of the Velasquez brothers have been less interested in the company than their father; Jim Connolly told the Statesman that the Velasquez family approached Yellow about the sale, not vice-versa. However, several sources familiar with the discussion say that the large family isn't completely in agreement on selling the business. The company's asking price is unknown, but the deal, consuming Roy's attorneys for more than a year, is rumored to cost between $4 and $5 million.

Roy's can't reveal the asking price – or much else, for that matter – as part of a nondisclosure agreement with Yellow; on attorney Chip Evans' advice, the family has rejected media requests for comment, for fear of compromising the deal. However, brother Robert Velasquez consented to a brief interview to dispel rumors. "Whatever happens in our organization, I believe that's nobody's business," Velasquez says, but he maintains the decision required a "supermajority" of all five brothers. Evans says, "At this point, they're all in agreement." Velasquez also disagrees with the Statesman's reporting on the sale. "We were approached by Yellow about a year ago ... [and] we thought about it for about six months. Yellow approached us."

Velasquez says the reason for the sale is simple: "We've gotten old." Indeed, the oldest of the brothers are over 70. Passing the company to their progeny is also problematic; among the five brothers there are nearly 20 children. "Austin's not the same, like it used to be," he continues. "The industry has gotten too big. Twenty years ago, you could buy a car for $1,500; $2,000. Now you can't buy a car for less than $15,000." He admits "there's some sentimentality" working against the sale, "but we have to lay out all the pros and cons. Everything was placed on the table."

"How can they deny us the sale after so many years in the business?" Velasquez asks. "We paid our dues in the community. ... My oldest brother, Roy, he's been involved in the cab community for 50 years. I've been involved about 30 years." He's sympathetic to his drivers' concerns but lays their future failure or success at their own wheels. "In this industry, if you're a cab operator and you have any kind of experience, you can make money. ... [You can] gather your own private clientele." Ironically, he allows that Roy's comparatively easy management style may have left some drivers ill-equipped for the transfer. "Some of the problem we've had is that we've been too lenient. But we're from the old school." Comparatively, he says, drivers may find Yellow "a bit more strict than we have been."

Yellow's history is more convoluted. Bearing an archetypical name long synonymous with the profession, there have seemingly been "yellow" cabs in Austin as long as there have been taxis. But Yellow's current incarnation began in earnest as American Cab Company, debuting in 1985 with 100 permits. Ten years after its launch, American had bought the existing, ailing Yellow franchise, which had previously incorporated another competitor, Checker Cab. The company called itself the unwieldy American Yellow Checker Cab Company when purchased in 2003 by the Texas Taxi conglomerate, which operates Yellow franchises in Houston and San Antonio; when the franchise was renewed in January of last year, the name was abbreviated to Yellow Cab.

A longtime Eastsider, local businessman, and taxi wonk, Ron Means ("Ron Means Business"), the co-owner and general manager of Austin Cab, says American's initial media blitz highlighted a small but important aspect of the new company's service: "American came into town and said, 'We have door handles,'" recalls Means. He remembers Roy's circa-1980s fleet of Chevy Impalas, their thin aluminum handles breaking off after little use; American arrived with an armada of sturdier-handled Dodge Diplomats. The Impalas' shortcomings also applied to their trunks; keys easily broke off in the back hatch, so hacks had to use tools to jimmy them open. "You'd see a [Roy's] car cruising down the street with a screwdriver sticking out of the trunk."

At the airport holding queue, cabs can idle for hours.
At the airport holding queue, cabs can idle for hours. (Photo By Jana Birchum)

Like the Velasquez family, Means is also the descendant of a taxi dynasty: his family launched Austin Cab in 1984 by buying the storied Harlem Cab company. Harlem was one of two black-owned cab companies serving the Eastside; the other company, Deluxe, folded in the mid-1970s when the City Council revoked the franchise for nonpayment of back taxes. (Under the pending transfer, Austin Cab is slated to receive 20 permits for displaced Roy's drivers).

Means is skeptical of the controversy surrounding the sale; like Velasquez, he chalks up the drivers' suspicions to dislike of Yellow's management style. While Roy's cheaper fees create less work-fast incentive for drivers, letting them spend hours at the airport, "looking for that big lick" – a $70 fare to Georgetown, for instance – Means says Yellow expects more from its drivers. "Yellow's M.O. is to charge the drivers as much as they can so they earn as much as they can," he says.

For all his knowledge of the local history, Means is less than romantic on the taxi life. "There's only one way you could deny the sale – if Yellow is the big bad wolf. They're not. Yellow pays the bills on time, keeps the cabs clean. They're not the big bad wolf. They're big – and bad – but they ain't the wolf! ... What is in the best interest of the public, their needs and necessities?" he asks, wondering why drivers' "wants and wishes" should come first. "What is it about driving a cab that's so fucking intoxicating that these people couldn't do something else? Who's holding a gun to their head? All these drivers that are complaining – if you don't like it, do something else."


Permit Me

As Roy's stands poised to become another Yellow acquisition, Nwoko and those opposed to the sale have thus far been unable to persuade the council to stop the meter – on first reading, April 27, only Mayor Pro Tem Danny Thomas voted no, and on second reading, May 25, Thomas was joined only by Will Wynn. The mayor said he was concerned about approving the sale without a new franchise in place, as well as managing the allotment of future permits to any new franchise. But the majority council logic has run that the permits, like the business itself, are Roy's to do with as the owners see fit, and that to deny the family ownership of a long-serving company its exit plan from the business is simply untenable.

Nwoko thinks the council, in an excess of legalistic caution, isn't properly asserting the city's literal ownership of its own permits. "At all times, those 155 permits don't belong to Roy's, they belong to the city," says Nwoko. "If they [the council] were gonna do the right thing, they'd take those permits and create a new franchise." An alternate proposal from Council Member Betty Dunkerley – to approve the transfer while creating a new franchise and other conditions – has proven equally unpopular because it's far too limited in scope. (See "Parsing the Permits," p.30.)

The appropriate thing to do, says Nwoko, is to sell 75 of the 155 permits to a new franchise. The three applicants currently vying for that opportunity – Capital City Cab Company, Lone Star Cab, and Longhorn Cab – are in agreement that the number of permits in Dunkerley's proposal isn't enough to establish a new franchise.

Nwoko would then allocate 50 of the remaining permits as "portable permits." Unlike the current system, where renewable permits are only granted to franchises, these would be issued directly to drivers. They would still register with a company of their choice, driving for them in a similar subcontractor position, but Nwoko feels they'd be granted more control. "It's a change for the companies," she admits. "They might feel they're losing control of their drivers." But she feels it would ultimately benefit the companies, by attracting "more sincere, responsible, adult" drivers. She then proposes allocating 20 permits to Austin Cab and 10 to Yellow for the remaining displaced drivers.

Dunkerley says she's "heard a lot of talk" about alternate proposals, but she hasn't seen anything persuasive. Asked about the portable permit proposal, she says it defeats the purpose of the city's franchising system. "I just can't see the city getting in the business of controlling hundreds of individual cabs. I think it's too difficult." She emphasized, however, that she would "work informally" with the relevant companies so that Roy's drivers preferring to work for the new company could keep their Roy's colors until the new franchise is formed, instead of driving for Yellow.

"That $270 versus $220 strikes you," Dunkerley says of the difference in terminal fees. "But until you check into the type of things [Yellow includes], you assume it's better to drive somewhere else."


The Meter's Running

What is Roy's now, if not a home for the displaced? Would-be entrepreneurs, recent immigrants, and those on their third, fourth, or 14th career flock to Roy's because of the relatively low start-up costs. Whether they will be able to fly solo under the Yellow banner remains to be seen.

Nwoko is maneuvering around the cabbies' kiosk, catching up with her co-workers while telling them about the gas-allowance increase. Suddenly, she's holding a frantically sobbing female driver. The woman's father is dying in a Dallas hospital, and she has no way of seeing him. "Don't you worry, you'll get your ticket," Nwoko says, cradling her in her broad arms as she cries. "You'll see your daddy before he passes." Once the driver is calmed, Nwoko grabs a notebook and pen and begins taking donations from the drivers. Forty dollars is instantly collected from bystanders, all cabbies from different companies, to help purchase a Greyhound ticket and motel room. Nwoko seamlessly passes the ledger and collection duties to another driver. The efficiency with which the process unfolds suggests this sort of emergency isn't an uncommon occurrence. Nwoko says the collections happen frequently, usually to assist with medical bills or similar family emergencies. Nwoko is good at it, too. "They kind of see me like a mother figure." end story

  • More of the Story

  • Parsing the Permits

    Dunkerley compromise could be both too little for new franchise but too much for the market
  • Blind Leading the Sighted

    Yellow Cab of Austin has become an employment option for people who are visually impaired

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