OCEAN CITY – The city is beginning to question thidly of the taxi medallion transfers within the industry as thues being brought before the Mayor and Council are not matching up.

During this week’s meeting at City Hall, City Clerk Kelly Allmond brought two taxi medallion transfers before the Mayor and City Council for approval. Taxi medallions were established a few years ago to regulate the rapidly growing taxi cab industry in Ocean City.

According to Ocean City’s charter, no taxicab shall be operated without a medallion. The Police Commission is authorized to issue up to 175 taxicab medallions -- up to 85 percent to be issued to fleet holders and up to 15 percent to be issued to independent holders.

If a taxicab medallion is paid in full, the holder of a taxicab medallion may transfer the taxicab medallion to another holder; provided however, that a fleet holder may transfer to either a fleet holder or independent holder and an independent holder may only transfer to another independent holder to maintain at least a 15 percent holder ratio to independent holders.

Any transfer of a taxicab medallion is subject to the approval of the Mayor and City Council with a few provisions, including the payment of a transfer fee to the Mayor and City Council equal to the greater of $500 or 25 percent of the transfer price. Also, the Mayor and City Council has the right to refuse the transfer and acquire the medallion for the proposed purchase price.

The first taxi medallion transfer was conducted on Oct, 24 from Wayne White of City Cab to Ahmed Khan for $5,000. The town received 25 percent of the sale, or $1,250. The council approved the transfer with no discussion.

The second transfer was conducted on Nov. 13 from Ruben Ortega sold to Grazyna Sobocynska of AA Beach/Nite Club Taxi for $3,000, resulting in a transfer fee payment to the town of $750.

“It seems the market that has been set on these medallions is between $5,000 and $6,000, and the amount the city receives is based on the amount of the transfer,” Mayor Rick Meehan said. “When one sells on Oct. 24 for $5,000, it’s just kind of strange that somebody on Nov. 13 would sell one for $3,000 ... it just seems to me that is an unusual discrepancy.”

Allmond presented a chart of taxi medallion transfer prices from November 2010 to November 2012. The chart reflects prices dropping and increasing randomly, falling as low as $1,500 and as high as $6,500.

“As you can see, the prices are all over the place,” she said. “The mean average is about $2,800 per medallion.”

Councilman Doug Cymek made a motion that the city exercises its right under the charter to deny the transfer and retain the medallion for the city’s inventory and buy the medallion for $3,000.

Meehan followed the motion up by suggesting the council address raising the minimum of the town’s transfer fee as a solution.

“It is just a little conspicuous to me,” he said. “I don’t know but it would seem within 30 days they would transfer close to the samue.”

Councilwoman Margaret Pillas did not agree with the motion or the mayor’s suggestion. She said there was no evidence to a deal being made under the table so that the expense of a larger transfer fee would be saved.

“One thing they [taxi operators] were concerned about when they did come in was that we would start to manipulate this without discussion with them, so if we are going to make some changes I hope we would bring the community back so they can have some input,” she said.

Meehan responded he was not making accusations but precautions should be taken to balance the system and for taxpayer purposes.

“It was always known that we had the right to purchase them back for several reasons … also to make them moruable,” Council Secretary Mary Knight said. “If we hold back a couple, I think the medallion will get closer to that $5,000. I don’t think we are interfering. The market is now suggesting that we do that.”

Councilman Joe Mitrecic asserted that if the taxi medallion is beginning to sell for a cheaper price then there must be too many on the street.

“I don’t think this disadvantages anybody … if we don’t feel the price is at a premium, then we need to pull some of them off the street and put them at a premium,” he said.

The council voted 5-2, with Council members Brent Ashley and Pillas in opposition, to approve the city’s purchase of the medallion to place in its own inventory.

“I would like to look at some statistics besides this graph and the possibility that we might raise the transfer fee percentage for the taxpayers,” Knight said.

Council President Lloyd Martin said the discussion will be scheduled for a future work session.