A lender holdout in the debt-relief deal for taxi medallion owners has called off its repo men after a caravan of cabbies traveled to Minnesota this week to call on the firm to come to the table.
The peace agreement between the New York Taxi Workers Alliance and Edina, Minn.-based lender O’Brien-Staley Partners/OSK came amid pressure from Senate Majority Leader Chuck Schumer and other local lawmakers — and followed stories in THE CITY about medallion repossessions that continued even after City Hall gave the green light to a program to restructure loans.
Schumer credited that reporting with highlighting the plight of medallion owners who were facing foreclosure on the once-prized piece of metal on taxi hoods that allows drivers to pick up street hails.
“Many people in our city have pain, but too few pay attention. By shining a spotlight on this, you guys helped make this happen,” Schumer told THE CITY.
Cab owner Sunil Kaushik told THE CITY he has been fighting in court to get back his medallion that was repossessed last year. His taxi has been stashed in a Queens driveway, where he said it’s been stripped of its muffler and catalytic converter while sidelined.
Kaushik canceled insurance on the taxi because he was not driving during the pandemic and had to pay out of pocket to replace the stolen parts. Now he wants back on the road.
“I’m very, very, very thankful,” he said of the deal. “I’m very hopeful to get my job back and I can provide my services as a New Yorker.”
Taxi and Limousine Commission data shows there were 42 medallion foreclosures last month — after 94 in January, 87 in December and 72 in November. Records reveal there were 497 foreclosures in 2021, peaking with 119 in August.
The foreclosures followed years of upheaval in an industry rocked by competition from ride-hailing apps like Uber and Lyft.
TLC figures show there were 6,734 yellow taxis on the road in February — just half of the total medallion vehicles.
The February vehicle count amounts to about 60% of the number of yellow taxis before the pandemic, underscoring a sluggish comeback compared with the 86% recovery among for-hire vehicles like Uber and Lyft.
The Taxi Workers Alliance had repeatedly pressed O’Brien Partners/OSK to halt foreclosures, staging several protests outside the Manhattan office of a law firm that had been sending out repossession notices on behalf of the lender.
Last weekend, the group organized a caravan to Edina, Minnesota, for two days of talks with a firm whose taxi-industry investments include loans secured by 323 — or 2% — of all medallions in the city.
“We got everything,” Bhairavi Desai, executive director of the NYTWA, told THE CITY. “We had our list out, we got everything.”
The deal puts an end to the threat of foreclosure faced by medallion owners whose loans are with O’Brien-Staley Partners/OSK. It allows them to keep their medallions via previously agreed-to weekly payments, or, starting April 1, through restructured monthly payments of $1,122.
More than 60 of the state’s elected officials earlier this month called on the lender to put an end to medallion seizures and foreclosures that continued after the city’s November agreement with Marblegate Asset Management, the largest holder of medallion loans, to restructure loans up to $200,000.
That deal was preceded by protests and a 15-day hunger strike last fall at City Hall.
E. Gerald O’Brien, CEO of O’Brien-Staley Partners, last Friday responded with a letter to Schumer’s office explaining that the firm was working in good faith “to resolve a very challenging situation for the medallion owners.”
The letter, which was provided to THE CITY, noted that the firm had signed on to the initial $65 million owner-driver relief fund that the city committed to last spring. On March 17, the TLC authorized the followup taxi medallion debt relief program.
According to the TLC, the program has, as of Wednesday, provided 275 grants to medallion owners, totaling $40.3 million in debt forgiveness.
“With the medallion relief program, we are finally turning the tide on the taxi medallion debt crisis,” Ryan Wanttaja, acting TLC commissioner, said in a statement. “We are continuing to encourage all lenders to participate so we can ensure that medallion owners in financial distress get real debt forgiveness.”
In a statement confirming its participation in the debt-relief program, O’Brien-Staley Partners said it “looks forward to the stability this agreement will bring.”
“It’s hard for any business to pre-commit to something that doesn’t exist yet without seeing the written details,” O’Brien said in the statement. “That seemed to be the primary disagreement between the parties. “Senator Schumer understood that reality and helped everyone to be pragmatic and find common ground.”
‘I’ll Take It’
Under the agreement, O’Brien-Staley Partners is supposed to halt any private sales contracts for medallions that had been repossessed and instead offer relief to borrowers locked in court battles.
“If a medallion is not sold yet, they will get theirs back,” Desai said. “If sold already, which I doubt, they will get an offer for the same terms with another available medallion.”
Medallion owner Kumar Dhiren, who received a letter in October saying his medallion had been sold after being repossessed, said he is still in the dark on what the deal may mean for him.
“Unfortunately, I don’t know how much benefit I get,” said Dhiren, whose Toyota Prius taxi has been stashed in his Queens Village driveway for months. “I don’t know what happens with me.”
Dhiren, who paid more than $600,000 for the medallion in 2011, said he would happily return to the road if he can reclaim the once-prized asset, whose value collapsed from more than $1 million in late 2014 to a fraction of that after the arrival in the city of the ride-hailing apps.
“If they give it to me, I will take it,” the Bangladeshi immigrant said.
This article was originally posted on Taxi Medallion Owners Hail Win in Fight Against Holdout Loan Firm