Taxicab chief weighs repeal of tips ruling

Thursday, Jan. 31, 2002 | 1:25 a.m.

State Taxicab Authority Administrator John Plunkett plans to ask his five-member board next month to consider repealing a hotly debated regulation barring cabbies from accepting tips from local businesses.

The move flies in the face of a Jan. 7 preliminary injunction issued by District Judge Sally Loehrer taking the Taxicab Authority to task for not enforcing the regulation.

Plunkett told the Sun last week that the regulation is hard to enforce because too many cabbies accept the kickbacks and too many businesses are willing to pay them to steer customers their way. He said Loehrer did not give the authority an opportunity for input before the preliminary injunction was handed down.

On Wednesday Plunkett said he's putting the tip item on the taxicab board's Feb. 19 agenda at the request of a union that represents half of the city's 4,000 drivers, most of whom are up-in-arms over the preliminary injunction.

Cabbies contend the kickbacks have become a financial necessity for them in the post-Sept. 11 era of declining tourism in Southern Nevada.

"I just think the whole issue has got to be revisited," Plunkett said. "Tips have become an integral part of the income of cabbies. I think it's more important now because of our slumping economy."

Loehrer issued the preliminary injunction on behalf of several major adult nightclubs locked in a kickback bidding war with their smaller higher-paying rivals. Some of the smaller clubs have been giving drivers as much as $40 for each customer brought to their establishment, and the larger clubs contend that is diverting business away from them.

It is a crime under state law for cabbies to divert passengers away from their intended destination.

Olympic Garden, Crazy Horse Too, Club Paradise and Cheetah's filed suit against their smaller competitors late last year to stop them from conspiring with cabbies to siphon off business. A trial is expected in Loehrer's courtroom in April.

Ruthie Jones, a vice president of the Industrial Technical Professional Employees Union (ITPEU), which represents drivers at Yellow Checker Star Cab, the city's largest company, said the taxicab regulation and the preliminary injunction are unfair to drivers.

"It restricts them from receiving anything, not even a bottle of water," she said.

Jones sent a letter to Plunkett Wednesday formally requesting the Feb. 19 agenda item.

The man leading the charge to enforce the kickback ban, Olympic Garden owner Peter Eliades, said he intends to oppose the effort to remove the anti-tip regulation.

"If they take it off the books, then they'll be robbing the public," said Eliades, who also has a financial interest in Yellow Checker Star.

His lawyer, Dominic Gentile, said it appeared to him that the cabbies are trying to put political pressure on the Taxicab Authority.

"That's a lot like the fox trying to negotiate with the farmer to get into the chicken coup," he said. "The bottom line is the Taxicab Authority is there to protect the public, not the drivers."

Plunkett, however, said he owed it to the taxicab industry to have a complete airing of the tip issue in public.

At the same time he said he remained concerned about the possibility that some drivers are taking money to illegal divert passengers, and he was continuing to aggressively investigate those allegations.

Undercover Taxicab Authority probes now have documented four cases of attempted diversion by cabbies, Plunkett said. Those drivers will be cited and could face the loss or suspension of their permits, he said.

The Sun reported earlier this week that the practice of giving kickbacks to cabbies has become widespread in the valley.

Besides the adult clubs, dozens of businesses -- among them restaurants, wedding chapels, tour companies, auto body shops, tattoo parlors and outcall services -- provide financial incentives to drivers. So do entertainers, such as Strip magician Lance Burton.

Plunkett said the taxicab board likely won't resolve the tip controversy until after the adult nightclub trial in Loehrer's court.

"We're going to try to get as much information as possible," he said.