The city of Santa Monica is poised to restrict taxi operations, which means several cab companies based there are facing a bleak future.

The City Council, reacting to complaints from residents and businesses, and even some taxi drivers, that there are too many cabs operating in the small city, last year approved the creation of a franchise system. City administrators were directed to select five taxi companies to hold the franchises, including a cap on the number of cabs allowed in the city. That would outlaw as many as half of the 500 taxis operating in Santa Monica.

In June, city administrators came out with their recommended list of companies: Bell Cab, Independent Taxi Owners Association, Metro Cab Co., Taxi Taxi and Yellow Cab Co. Early next month, the City Council is set to vote to award franchises to these five companies.

Michael Calin, general manager for Hawthorne-based Bell Cab, said there weren’t enough customers in Santa Monica to keep the number of cabs there in business, so some were seeking fares in nearby areas illegally.

“The numbers of cabs in Santa Monica were so insane that there was some spillover,” he said. “We had tremendous problems with bandit taxicabs in West Los Angeles.”

But left off the city’s list were eight taxi companies, many of which have operated in the city for years. One of those is VIP Yellow Cab, which has been based in Santa Monica for 10 years and has 54 drivers.

“It’s a very hard situation for us,” said Elen Poghosyan, owner of VIP Yellow Cab. “Losing our business in Santa Monica would probably mean bankruptcy.”

Once Santa Monica outlaws her company, it won’t be easy for drivers to find permits at other cab companies.

She is upset that most of the companies recommended for franchises are not based in the city, noting, “They appear to be cleaning out the ones based in Santa Monica.”

She also said that despite many of the companies in Santa Monica being owned by Armenian immigrants, none of the recommended companies is Armenian immigrant-owned. She said she participated in a protest organized by the Armenian immigrant community in June to voice her displeasure over the selection process.

In response to the protests, the city publicized its evaluation process for the 13 proposals that came in for the franchises. The staff report concluded that that several proposals were deficient in their business plans or their reliance on managers with “minimal relevant experience in the taxi industry,” and thus were eliminated.

Bell Cab’s Calin said that some of the cab drivers at the companies eliminated by the city may be able to join up with his company.

“We are entertaining the idea of opening the door and absorbing some of these cab owners and drivers; they would be able to remain in Santa Monica but operate under our name,” he said.

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