Taxicab Agency at LAX Criticized

A nonprofit agency managing taxi operations at Los Angeles International Airport handed out cash to the managers of cab companies but could not document why. It paid employees who were allegedly injured on the job, but never filed required reports with the state. It paid tens of thousands of dollars to lawyers and contractors with no evidence that it got sufficient services in return.

Those are among the problems at Authorized Taxicab Supervision identified in an audit by City Controller Laura Chick.

ATS manager Bezhad Bitaraf took issue with the report, saying it contained "a lot of mistakes."

The audit, released last month, also criticized the city airport department as abdicating its responsibility to monitor the agency, saying, for example, that ATS was charging a catering truck $24,000 a year to park near Terminal One but that no one at LAX knew about it. In addition, the audit found that ATS was paying off-duty police officers to direct traffic and roam the airport in their own cars looking for bandit taxis -- work that airport officials knew of and did not object to but that was not authorized in the contract.

"Anyone who knows the details of this arrangement would step back and say, 'Huh? That isn't right,' " Chick said. She said auditors uncovered practices that appeared to be "back-scratching" and "cushy deals."

"The airport needs to fix these problems," she said.

In a written response, ATS said airport officials had "full knowledge" that the agency was charging the catering truck. The statement also said that ATS had ceased cash payments to its board members and begun paying them by check four months ago but that the "auditor chose not to report this, apparently to cast ATS in a disfavorable light." The board of directors comprises presidents of the city's nine licensed companies.

The statement also said the agency had complied with workers' compensation rules.

For two decades, ATS and its predecessor agency have managed taxi operations at LAX. Drivers of the city's 2,300 cabs earn a huge portion of their income shuttling passengers out of the airport, and drivers covet those trips because they are typically longer and pay more.

To prevent every cabdriver in the city from converging on the airport every day, ATS assigns taxis to come on different days and runs a holding lot near Terminal One, where cabs congregate and are then dispatched to terminals to pick up passengers.

To fund the service, drivers pay $2.50 each time their cars enter the airport, giving ATS annual revenue of about $3.8 million, most of which goes to pay employees who run the holding lot and operations at the terminals. ATS officials can also cite drivers who do not obey the rules.

City officials have often touted the operation as one that serves the public well and is copied by airports around the U.S.

But some cabdrivers and their advocates have said that agency employees treat them badly and that ATS' finances are not properly documented.

Two years ago, cabdrivers, with the help of legal aid lawyers and community organizers, formed the Los Angeles Taxi Workers Alliance and began trying to challenge the city's taxi system. At the top of their list of complaints was ATS.

The report "confirms what drivers have been saying for years. ATS has been exploiting drivers and operating with questionable practices," said Betty Hung, a lawyer with the Los Angeles Legal Aid Foundation who is helping to organize drivers. "What the audit also shows is the city has been asleep at the wheel."

Councilwoman Janice Hahn said she would introduce legislation to fix the problems, adding that she was particularly disturbed by the catering truck and the cash payments.

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