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Schenectady cabs see opportunity despite growth of ride-sharing

Schenectady cabs see opportunity despite growth of ride-sharing

Local taxi operators seeking medallions
Schenectady cabs see opportunity despite growth of ride-sharing
Photographer: ShutterStock photos

SCHENECTADY — While some taxi operators view ride-sharing companies as an existential threat to their future, at least one local cab company sees a growth opportunity despite the crowded transportation landscape.

Schenectady-based cab operators Action Transportation have spent the past two years trying to obtain medallions from the city in order to diversify their operations.

At present, the company is confined to offering medical transportation, itself a lucrative industry since statewide reforms a decade ago began steering Medicaid patients into taxis to convey them to medical appointments. 

But Action has been hamstrung from further expansion by what they’ve contended was a lack of clarity on city policy governing medallion issuance.

Now that Schenectady Police Department has clarified city policy, the provider has applied for at least six, marking a significant investment when paired with new vehicles and the $500-per-medallion fee. 

“Do I think it’s going to be beneficial?” said James Moloney, director of operations. “Absolutely in this environment.” 

DEMAND HIGH

Providers have contended ride-sharing has disrupted their industry since entering the upstate market two years ago, including Capitaland, who previously cited Uber and Lyft as the reason for closing offices in Saratoga Springs and Schenectady. 

The effects on Action were more muted. 

“Sure, it’s a dent, but my phone rings constantly,” Moloney said.

Moloney indicated the decrease in business is nowhere as bad as in New York City, where the value of medallions has plummeted and more than 950 operators have filed for bankruptcy after being ensnared in complicated loan schemes, according to the New York Times. 

Moloney said the calls are from mostly low-income residents seeking rides to work or grocery stores.

Many don’t have a credit card, he said, which is necessary to use ride-hailing apps.

Electric City Taxi, too, will seek additional medallions.

Their dispatch center was a whirlwind of activity on Wednesday, where Operations Manager Phil Gibbs and a dispatcher linked passengers to drivers using a system of phones, computers, radios and Post-It notes stuck on a large board. 

Numerous calls came in from Hanneford, WalMart and Family Dollar on Crane Street. 

Laundromats are also big, Gibbs said.

“We mostly do peoples’ day-to-day needs,” he said. “That’s what the backbone of the company has become.”

Gibbs was critical of ride-sharing, contending the services undercut their rates but also used surge pricing to unnecessarily drive up costs.

While the playing field has been leveled slightly when it comes to ride-sharing companies providing workers compensation, Gibbs contended traditional operators like Electric City continue to face more stringent regulations.

And since drivers are classified as independent contractors, companies like Uber are not mandated to pay some benefits or minimum wage that are applicable to conventional operators, Vox reported.

“Ride-sharing is completely unfair,” Gibbs said.

TRANSPORTATION DILEMMA

Capital District Transportation Authority (CDTA) has 10 routes that service downtown Schenectady, which adds up to nearly 5,500 boardings daily in the city, which officials called a “a very healthy number for our system." 

That number just looks at the stops within the city limits of downtown Schenectady — not the route as a whole.

Rev. Phil Grigsby executive director of Schenectady Inner City Ministry (SICM) said while CDTA has recently made some routes more accessible — including those serving the Yates Village public housing complex, for instance — transportation remains a real challenge to many residents served by his organization. 

“When you don’t have the density, it’s a real challenge to make it work economically,” he said.

Food and transportation are intimately connected.

Many residents in low-income communities tend to go shopping monthly, Grigsby said. As such, navigating public transportation with numerous shopping bags can be tricky, particularly when transfers are involved.

That’s where taxis and ride-sharing apps become useful, he said. 

“Transportation is a real dilemma, and a dilemma for getting groceries,” Grigsby said. “It’s a real dilemma - if you’re poor - how you get around.”

Service at SICM’s food pantry on Albany Street was brisk on Wednesday.

The ministry serves an average of 100 people daily and has 11,000 people on their internal registry. Each day, a shuttle ferries people back to their homes after picking up bags of food, which can be unwieldy to carry home. 

Grigsby said he didn't necessarily believe lower-income residents lacked access to credit cards, but noted it could be challenging to keep their smartphones activated. 

CDTA also noted not everyone has access to ride-sharing technology.

“We will continue to see a need for taxi services in the Capital Region even with the growth and expansion of rideshare in our area,” said Jaime Watson, director of corporate communications. “The more mobility options we have available in the Capital Region, the better off we all are. We have to work together to keep the region moving and accessible.”

EXACT NUMBERS UNKNOWN

Uber and Lyft do not share ridership numbers, including number of trips or statistics on rider demographics, making it difficult to pin down data on ages, income levels and trips taken by users in Schenectady compared to Albany, Troy and Utica, for instance. 

But drivers are required to pay a $2 fee for entering Albany International Airport. 

Last year saw 77,270 pickups and drop-offs, according to airport officials.

The numbers are rising: This year through April, the number has reached 50,359.

Despite pulling back, Capitaland still has the contract to pick up airport passengers. Others are prohibited from soliciting passengers, and must provide name of passengers and their airlines in order to wait outside. 

While Capitaland, which didn't respond to multiple phone calls seeking comment, is using the airport business to stave off losses — and Action is expanding to provide conventional services — Electric City entered the medical taxi market. 

Kajal Lahiri, distinguished professor of economics at University at Albany, said the transportation industry is changing rapidly, and the competition will ultimately result in better services and conditions for riders — particularly if ride-sharing companies are allowed to enter the medical transportation market.

He also said the opportunities for ride-sharing in rural areas are largely untapped.

“In the process, some [companies] will die and some will survive,” he said. “The more experimentation, the better.”

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