Mayor Thomas M. Menino ordered a sweeping review of the city’s $1 billion taxi industry Monday, a day after the Globe Spotlight Team documented a lopsided system of enforcement in an industry that routinely punishes drivers but tolerates egregious conduct by cab owners who operate with relative impunity.
“We have real problems, and I’m very concerned about it,’’ Menino said during an interview in his office. “We’re not going to tolerate this nonsense.’’
The mayor said he hopes to hire a nationally recognized taxi industry specialist within days and seek recommendations within two or three months that could dramatically reshape how Boston taxis are regulated and managed.
Menino said he wants to revamp the Hackney Division of the Boston Police Department, the chief enforcer of those who drive and those who own city-licensed taxis.
He said he will push the Legislature to mandate higher insurance for cabs, most of which now operate with the state minimum bodily injury coverage of $20,000, less than half the required coverage for bike messenger services and much lower than taxis must carry in many other large cities.
“If we can’t get the Legislature to change it, we’ll do it administratively,’’ he said. “It’s too low. There’s no question about it.’’
And the mayor said he wants to install a civilian advisory board to, among other things, help reduce and resolve disputes between drivers and fleet owners.
The top-to-bottom review comes after a nine-month Globe investigation found that drivers are routinely forced to pay petty bribes to get keys to their cabs while owners commonly violate Police Department regulations without fear of sanction. A federal criminal investigation is under way, the Globe reported Sunday.
The Spotlight report also highlighted a Byzantine insurance system used by the city’s largest fleet owner, Edward J. Tutunjian. Instead of paying insurance premiums on each of his 372 taxis, the owner of Boston Cab self-insures his fleet by depositing $10,000 for each taxi with the state. He has earned hundreds of thousands of dollars in interest since 2003.
After the Globe’s inquiry, state Treasurer Steven Grossman said he will ask the Legislature to end the program because it benefits only the few prosperous entities that can afford it. He added that the required $20,000 in coverage, whether paid through a traditional insurance policy or self-insurance, is inadequate to cover people’s injuries.
Menino made it clear Monday that the Boston Police Department’s oversight of the taxi industry will be a central focus of the upcoming review and that among its recommendations could be a call to get the police force out of the taxi regulation business entirely.
“I’m looking to revamp the division,’’ Menino said after a meeting in his office with Police Commissioner Edward F. Davis and William F. Sinnott, the city’s corporation counsel.
Neither Menino nor Davis would directly comment about the future of the leader of the hackney division, Mark Cohen, the civilian director of licensing for the Police Department. Cohen has been overseeing city taxis since the 1980s. Davis said the unit’s top uniformed officer will now be given an enhanced role to supervise the division until the review is completed.
During interviews with the Spotlight Team, Cohen was unable to decipher the basic economics of his own division. And he quipped to two Globe reporters that he used to teach kindergarten, which he called a perfect training ground for working with cabbies.
Menino said Monday he was unaware of the abuse of taxi drivers, many of whom are poor immigrants who struggle to make a living wage while routinely working 60 hours a week or more. “Some of the stuff in there I have no control over,’’ he said.
The mayor’s call for a systematic review of the taxi industry was greeted with a combination of relief and skepticism from cabdriver advocates.
“Finally,’’ said Donna Blythe-Shaw, an organizer for the United Steelworkers and the Boston Taxi Drivers Association.
Blythe-Shaw said she and taxi drivers have publicly called on the mayor and City Council to reform the industry every year since 2007, but their entreaties went nowhere. She wrote Menino in 2007 and delivered petitions to his office in 2008 and 2009 urging him to reform the industry, she said.
“It takes the Spotlight Team to open his eyes?’’ she asked.
“The City Council has known about this as long as he’s been around,” she said of Menino. “They chose not to support hackney reform because they knew the mayor wouldn’t go for it.’’
If Cohen’s future is clouded, Blythe-Shaw said, the mayor should clear the air immediately by firing him. Cohen, she said, was responsible for an “archaic, autocratic, oppressive, and dysfunctional regulatory system that wastes taxpayers’ dollars and diverts police from neighborhood policing.’’
Cohen declined to comment.
As for reforming the industry, Blythe-Shaw said it is imperative that taxi drivers be involved. “We need some drivers, we need the union involved,” she said. “This is what we’ve been asking for since 2008.’’
The union activist has called for a civilian commission, financed with funds from medallion renewals and resales, to supplant Cohen’s Hackney Division.
During a 2011 hearing, drivers and advocates packed the City Hall chamber and Maureen Feeney, then a city councilor, said it was time to consider a different model to govern the industry.
“Much of the testimony that I’ve heard, as I’ve said, has been informative and educational, but it’s also been upsetting and concerning,’’ Councilor at Large Ayanna Pressley said then. “These cab drivers are risking their lives every day to provide a very important service for the residents of the city and for tourists, and for any of them to feel marginalized, exploited, or demoralized in any kind of way just doesn’t sit well with anyone, and it shouldn’t.’’
Tutunjian and other fleet owners steadfastly opposed the idea of changing the way Boston has governed its taxi industry for generations. The plan went nowhere.
Cohen, who attended the University of Pennsylvania, has worked for the Boston police since 1985. He is credited with transforming Boston’s taxi fleet from a scrubby collection of belching clunkers to an industry propelled by late-model vehicles, many of them gleaming new hybrids.
He sits on the board of an international association of taxi regulators and has helped usher in a requirement that all cabs accept credit cards.
He also drove the effort that introduced 100 wheelchair-
accessible taxis into Boston’s fleet.
The Globe reported this week that medallion owners who pleaded guilty to tax evasion, were suspected of misappropriating $200,000 from one cab association, and pleaded guilty to bribing a police sergeant were all allowed to keep their city-issued licenses.
Cohen said in earlier interviews that he could not recall a single instance where his division revoked a license, called a medallion, from an owner for misconduct.
The Menino-ordered examination of the cab business will also include whether the city should issue more medallions — they are capped at 1,825 — or other options to address increased demand from customers. The mayor said he also will institute a hot line to collect complaints from patrons and drivers. “For some reason we were not getting these allegations,’’ Davis said of the Globe’s report. “And we want to make sure we know of these things.’’