Small Matters: Why waste cash for few wheelchairs?

Philadelphia's latest regulatory idea is to require the modification of all Philadelphia taxis to make them wheelchair accessible.

Our taxi companies will have to retrofit existing cabs, making all 1,600 Philadelphia cabs wheelchair accessible over the next few years.

While a few people will benefit, a basic analysis shows why this is wrongheaded. It spends wildly to achieve a "social" aim, while imposing onerous costs on small businesses that make it harder to grow and create jobs.

This follows on the heels of City Council's attempt to broadly require paid sick days for all employees of firms in Philadelphia, raising the cost of labor and reducing profit, the only funds that support growth for most small firms.

It's just one more example of how politicians try to turn our small firms into instruments of social policy.

Apparently, city taxes on small businesses aren't sufficient to pay for the conversion of the taxi fleet to serve wheelchair clients. So the plan will be to force these small businesses to pay for the retrofitting with their own funds.

An estimate provided in a recent Inquirer article puts this cost at roughly $15,000 per cab. There are 1,600 licensed cabs in the city, so the cost of conversion would come to about $24 million. Basically, the city is imposing an additional tax of $24 million on small-business owners of taxi companies or their customers, assuming that regulators allow the companies to recoup some or all of the cost through higher cab fares.

So does the benefit offset the $24 million in costs paid by the firms and their customers?

The Census Bureau reports that about six-tenths of 1 percent of Americans use wheelchairs, mostly elderly. Assuming Philadelphia is "typical," that would be about 9,000 people. So, retrofitting will cost about $2,600 per person.

The next question is how many of the 9,000 want any taxi service at all? I have no data to answer that question, but it might be useful to find out just how many people want this service before we spend millions of dollars making it available.

If the city feels this is a public service that should be provided, then the city should pay for the cost of adapting 1,600 cabs, and not force cab companies and their customers to pay the cost.

Of course, the city does not have a spare $24 million to pay for this and proposes to use its power to impose its goal and "tax" the private sector.