On August 20, 1991, the New York City Transit Authority handed Al Manti, owner of a Brooklyn van service for commuters, a check for a cool $1 million. It was the spoils of war—a nine-year war of harassment the Transit Authority (TA) had waged to drive Manti out of business. Transit cops admitted in court that they had subjected Manti, who has a legal permit to operate vans between Bay Ridge and Manhattan, to constant surveillance: waiting outside his home and following him on trips to his second job (as a New York City fireman) and to the van yard. They even followed his mother to the grocery store.
Manti’s van drivers received repeated citations, later thrown out in court, for such things as parking in front of a fire hydrant after being instructed by a TA officer to do so; operating uninsured or unlicensed vehicles, even though their permits were in order and had been presented to an officer upon request; and driving without a chauffeur’s license, which is not required for van operation. According to Manti, transit cops regularly pulled over his vans during rush hour and held them for more than an hour, forcing passengers to sit and stew as other commuters on franchised and city buses went on their way.
In March 1991, Manti’s saga reached the Appellate Division of the Supreme Court. The judge, citing possible civil rights violations by the TA, called for a full trial to determine the extent of damages to Manti’s business. Under pressure, the TA finally threw in the towel, offering Manti $1 million to settle.
Manti’s troubles received wide attention in the press, but he was not the Transit Authority’s only target. Despite losing a battle to Manti, the TA’s war on vans continues unabated: Van services are the target of a special New York City Transit Authority task force, which between July 1990 and May 1991 issued 4,219 summonses, amounting to more than $1.6 million.
The TA claims to be acting in the public interest, protecting unwary citizens from unlicensed, uninsured, and unsafe operations. “The city’s interest is safety,” declares Peter Greenberg, director of bus programs at the Bureau of Transit Operations.
In fact, the city’s interest seems to be in eliminating competition, even when the competition is making life easier for New Yorkers. Despite TA harassment, private van services already help tens of thousands of New Yorkers get around the city every weekday. The vans specialize in neighborhoods where city buses and subways are rare, slow, inconvenient, or crowded and uncomfortable. These passengers prefer the van services enough to pay the higher fares they charge, even though many of the vans operate in poor neighborhoods.
The TA does not like this. The city views van services as “a private enterprise cutting into a public enterprise, “ says Jeff Maclin, a spokesman for the City Department of Transportation. Accordingly, the TA has proved more than willing to use its official power to stop them. The TA’s ticketing blitzes sometimes reach the level of harassment, as the court noted in the Manti case. It also tries to block the attempts of van owners to get licenses to operate legally. Since 1985, the TA has protested every one of the more than two hundred van-license applications. Although the protests rarely succeed, the forbidding application process itself effectively limits the pool of van operators.
Obtaining a van-service permit takes an average of six to eight months and requires legal counsel; costs typically exceed $1,500. Applicants must gather extensive documentation, including maps, client lists, financial data, and driving information, and procure three to five witnesses for an administrative hearing.
The high costs and complexity of this process explain why immigrant van operators often ignore the law and operate illegally. These new arrivals see an opportunity in the inadequate transit service in the poorest sections of the city, and gain a financial foothold by operating feeder services to major subway and bus arteries. Of course, illegal operators have virtually no protection from TA harassment.
The TA has consistently refused to provide van services even with curb space for drop-offs or permission to stop for extended periods at pickup locations. Even when van operators have organized and asked to be included in citywide transportation strategies, as the Jamaica Avenue Van Association did, officials have turned a blind eye to their concerns, refusing to let vans have a designated space near the Jamaica train terminal.
The city’s opposition to private transportation is selective: Private bus companies with city franchises receive millions of dollars in subsidies. These same private, subsidized bus companies are also official participants in the crackdown on vans. Their drivers serve as the eyes of the operation, spotting van operators and reporting them to the Transit Police. Thus the entrepreneurs who provide private van services must compete with an operation that not only has deep pockets, but its own police force.
The city’s favoritism is hardly profitable. In addition to subsidies, the city gives franchised bus companies exclusive rights to operate in particular areas of the city. In exchange it gets only 3 percent of their gross receipts. Companies whose buses are wheelchair-accessible pay a mere 0.1 percent of gross receipts. In 1989 such fees yielded the city less than $1 million, while the subsidies cost the city more than $48.2 million. (Favored bus companies got another $44 million in federal and state subsidies.)
The future looks even more grim for would-be van operators. State Senator Roy Goodman (R-Manhattan) is sponsoring a bill giving the City Department of Transportation jurisdiction over van services. Under Goodman’s bill, the Transit Police would have the authority to confiscate vehicles allegedly operating illegally. If this law had existed during the Eighties, Al Manti might never have had his day in court. The city could have summarily put him out of business simply by seizing his vans.
Why is the TA so vehemently opposed to competition? The answer, suggested by a January 1991 report by the CUNY Institute for Transportation Systems, is that pressure from labor unions makes it impossible for the TA to compete effectively. Output per worker decreased by 25 percent between 1960 and 1985, while wages and benefits increased 75 percent in real terms. Franchised bus companies are not much better off. Most of their unionized workers are entitled to the same rights and benefits as TA employees. The companies have little incentive to resist union demands. The city guarantees the companies enough in subsidies to keep them profitable, but if they annoy politically powerful unions, they risk losing their city contracts.
In the long or even medium term, the city would be better off encouraging the vans. A flourishing, highly competitive van industry, mostly nonunion and including a lot of owner-operators, might be just the thing to get more productivity out of transit workers in future contract talks, and would be very useful in the event of a transit strike. And van services are just the sort of easy-to-organize, low-capital businesses that attract underfunded minority and immigrant entrepreneurs, and in turn enrich their neighborhoods. Nevertheless, it seems all too likely that the combination of special-interest politics and TA heavy-handedness will I crush an industry that offers both business opportunities to immigrants and transportation options to city residents.