Council Okays Taxi Medallion Transfer

OCEAN CITY — The Ocean City Council this week approved the sale of a taxi medallion from one independent operator to another after sending the seller back to the drawing board two weeks ago over concerns about the low sale price.

In early December, Ocean City reviewed two taxi medallion transfer requests, one of which came in at $5,000 and the other that came in at the much lower $3,000. The second proposed transfer raised eyebrows because of its relatively low price compared to the average sale price of the medallions in recent months, causing the elected officials to believe there might be some collusion in the proposed deal.

As a result, the council denied the transfer and sent the seller, independent operator Ruben Ortega, back to renegotiate the transfer price or run the risk of the town exercising its right to deny the transfer and instead purchase the medallion and return it to the town’s own inventory. At the time, Ortega explained the reason for his decision to sell the medallion to AA Beach/Nite Club Taxi included a total loss of his cab during Hurricane Sandy and the overall decline in his business.

Ortega lost two vehicles during Hurricane Sandy, including his taxi cab and his personal vehicle. According to Ortega, the Maryland Automobile Insurance Fund (MAIF) denied a claim to repair the cab because it was not a claim to protect another vehicle damaged or the people inside of the cab due to an accident. With the damage to his cab on top of an already struggling business, Ortega decided to get out of the taxi industry altogether and shopped his taxi medallion, for which he paid $1,500 less than three years ago, to friends and colleagues in the business.

AA Beach/Nite Club Taxi agreed to purchase Ortega’s medallion for $3,000 along with another $1,000 for the damaged cab. The buyer also agreed to pay the transfer fee owed to the city, or 25 percent of the sale, which came in at $750.

In early December, the council turned down the proposed transaction at $3,000, suggesting it did not reflect the entire amount of the sale including the $1,000 sale of the cab and the transfer tax. Ortega was instructed to go back and rework the transaction to reflect the total sale price.

On Monday, Ortega returned with a completed transaction for $3,750, which reflected the transfer of the medallion and the 25 percent transfer fee to the city. After reviewing the revised transaction, the Council approved the transfer of medallion 156 from Ortega to AA Beach/Nite Club Taxi.