A-Cab’s bid to widen territory denied by Nevada Taxicab Authority

For more than half of A-Cab’s existence, owner Jay Nady has tried to expand the company’s permitted territory from west of Interstate 15 to cover the rest of the county.

The latest attempt will face at least another month’s delay. The Nevada Taxicab Authority on Tuesday voted to reject the application because it was submitted under the wrong section of state law.

However, the authority will allow Nady to reword his request and try again at the next meeting, Feb. 25.

Even if A-Cab clears that hurdle, Nady will likely face strong, if not unanimous, opposition from the rest of the industry, which will seek to keep the company from picking up passengers on the Strip or at McCarran International Airport. These are by far Las Vegas’ busiest and most lucrative territories.

Although much of the discussion focused on attorneys’ interpretations of Nevada statutes, Nady distilled the dispute to basic terms.

“They (the 15 other cab brands) are being mean-spirited,” he said. “Regardless of what you think, it’s the competition they don’t like.”

But John Hickman, chief operating officer of Frias Transportation Management, the largest local company with five brands, said protecting turf and profits did not motivate them.

“These things have to be pursued under the proper statute so that others follow the precedent later,” he said.

The section that A-Cab followed pertained to the rest of the state except Clark County, according to the authority. The local rules require an applicant to show that other companies will “not meet the needs of the territory” if the request is rejected, a standard Nady acknowledged is difficult to meet. The statewide rules create an easier path by not imposing this condition.

When the authority approved A-Cab’s formation nearly 13 years ago, it did so to ensure locals would have access to decent service and wouldn’t face lengthy waits for rides because drivers wanted to focus on the tourists. The rules allowed A-Cab to drop people off at McCarran or the Strip, but not pick anyone up for the return trip.

The master permit also included a proviso that A-Cab couldn’t try to broaden its geographic scope for at least five years. Shortly after that expired, A-Cab tried to loosen its restrictions but gave up in 2009 in the face of insurmountable opposition.

Nady continued to talk up expansion informally, particularly when other cab companies sought temporary operating permits, called medallions, to handle major events. In March, he filed papers to formally lift the geographic restriction.

He said A-Cab is profitable but lags other companies.

“We pay our drivers less. We are understaffed,” Nady said. “We blow a number of shifts on purpose because we don’t have enough business to justify them.”

A blown shift happens when a cab stays on the lot even though medallions are available to allow it on the streets. In December, authority statistics show, A-Cab had the highest level of blown shifts in the local industry at 11 percent. Only two other operator ran as high as 6 percent.

Also, Nady said, A-Cab’s geographic restrictions cause the company’s drivers to go to a destination with the backseat empty much more often than rivals. At Strip resorts or McCarran, the drivers typically let a passenger off and then get in line at the same place to pick up the next fare.

“Nobody can run a business when half your trips are empty,” he said.

A-Cab holds 75 medallions out of 2,410 allocated for Las Vegas (3.1 percent). Some of the medallions can go on the streets anytime, but others come with time or day restrictions. Other companies also work with geographic restrictions, but only for a fraction of their fleets.

Tim O’Reiley can be reached at toreiley@reviewjournal.com or at 702-387-5290.