It will soon cost at least 70 cents more to grab a taxi in Hamilton. And next year, it could go even higher.
Cab drivers will increase the initial pick-up rate to $3.90, compared to the current rate of $3.20. The per-kilometre amount riders pay will decrease slightly – from $1.82 to $1.80.
The pick-up increase is just a cushion until a city-hired consultant presents to councillors next year on how to help the ailing industry. But it’s necessary, said Coun. Chad Collins, who successfully moved the increase at the city planning committee on Tuesday.
“People are losing their jobs,” said the Ward 5 councillor of the taxi industry.
The consultant’s report is due in early 2014, but this increase will at least provide an “interim cushion,” Collins said.
The taxi industry has struggled since January, when Arch Insurance, the sole underwriter of taxi companies in Toronto and Hamilton, stopped covering cab drivers. Zurich Insurance now underwrites taxi companies, but at double the cost, said George McCarter, president of the Stoney Creek-based Pearson Dunn Insurance, the city’s official insurance provider.
Before January, cab drivers paid about $5,000 per year. Now those with clean driving records pay $10,000 per year. Those with previous accidents pay as much as $18,000, he said.
Hamilton taxis also have slightly higher accident rate than other cities, McCarter said.
Some cab drivers are simply handing in their licences, unable to keep up with the rates, McCarter said. He knows of about 15 drivers with Blue Line Taxi who have stepped away since January.
The increased pick-up rate still puts Hamilton at a lower rate than many of its neighbours. Burlington’s pick-up rate is $3.50, Oakville’s is $4.50, and Toronto and Mississauga have a start rate of $4.25.
The consultant will hold public consultation sessions later this month, city staff say. It will present a report – and possibly recommend further increases – in early 2014.
It’s important that the cab industry stay vital, Coun. Brad Clark said.
“This is one of those ones that’s silent but deadly,” he said. “It slowly creeps up on you over time, and more and more cabs will fall by the wayside.”
Council will vote to ratify the increase on Oct. 23.