The Hot Springs Transportation Advisory Committee voted Thursday to allow Hot Springs Taxi and its subsidiaries to continue operating despite the city citing the owner for operating a business without a license.
The committee adopted City Attorney Brian Albright’s recommendation to allow the business to continue operating under Hot Springs Taxi’s transportation license, which the city says has been renewed for 2022.
“It’s a positive outcome for the committee,” Deputy City Manager Lance Spicer told committee members. “That’s really what you want. You’re looking for compliance, not being punitive.”
Albright told the panel that Service Cab Co., Yellow Cab and Checker Cab, all of which operate under Hot Springs Taxi’s transportation license, were not registered with the Secretary of State’s office. The city filed a subpoena against owner Darrian Conner in Hot Springs District Court on Feb. 8.
“There was no license for Checker, Service or Yellow,” Albright said. “The confusion associated with the continued operation of Yellow, Checker, and Service without a license was problematic. There were no proper fictitious names registered with the Secretary of State and County Clerk’s Office. Vehicles that operated under this logo have become a problem.”
He said Conner registered the names ahead of Thursday’s hearing and the city would drop the class A misdemeanor charge.
“This means that if there are further violations over the next year, these citations could be reinstated and dealt with with any future violations,” he said. “If you want to see it as probation, you can think of it as probation. I think Mr. Conner has every intention of continuing to operate in compliance. I think there was just confusion, which has now been dissipated.”
The city sent a cease and desist letter in January advising that the company’s insurance coverage on about a dozen of its vehicles had expired, putting it in violation of the city’s transportation code. The letter, which the city provided in response to a request for records, ordered the company to immediately cease and desist from any previously authorized activity.
Hot Springs Taxi said Thursday it does not operate uninsured vehicles. The city told the company in a letter dated Feb. 8 that its vehicles were not properly registered.
“At this time, none of your vehicles are properly registered under the Hot Springs Transportation Code,” the letter states. “The City of Hot Springs has received calls, complaints and photos indicating that Checker Cab, Hot Springs Taxi, Service Cab Co. and/or Yellow Cab continue to operate in violation of the Notice of Cessation and abstention.”
The letter notified the company of a Feb. 24 hearing before the Transportation Advisory Committee. Thursday’s hearing was a continuation of the hearing convened last month.
Conner told the city in a letter dated Feb. 11 that the cease and desist notice ordering him to halt operations violated his right to due process. The letter cited the section of the transportation code stating that permits or licenses can be suspended or revoked after a hearing before the committee.
Albright responded in a Feb. 14 email to Conner that due process had not been violated.
“Your due process rights have not been violated as you have been advised of the administrative hearing into this matter to be held (February 24),” he said. “…You will be given the opportunity to be heard on that date and present any evidence you may have demonstrating compliance.”
Albright told the committee on Thursday that Hot Springs Taxi had provided a self-insurance statement from the Department of Finance and State Administration certifying that its vehicles were covered by the company rather than an insurance company.
According to the state self-insurer law, the certificate can be voided if the company does not pay the judgments against it within 30 days of the final judgment.
A cease-and-desist letter the city sent Conner last March ordered him to halt operations after he failed to submit documents, such as proof of liability insurance and police safety inspections that the city’s transportation code requires before an annual operating permit can be issued.
The business resumed operations after Conner submitted the necessary paperwork several weeks later. He said the difficult circumstances that had beset his business had delayed submissions.
He acquired the taxi company in 2015 from the Johnston family, who owned it for more than 20 years. He delegated most day-to-day operations to a former employee in January 2019. The employee mismanaged the business, he said, embezzling funds, not paying the rent for his Hobson Street office, the personal property taxes on its fleet of more than 40 vehicles or the state franchise tax.
Important communications, such as notices from the state tax agency to renew vehicle registrations, were not reaching the company because the employee surreptitiously changed the mailing address to a PO Box. Conner said he didn’t learn the extent of the mismanagement until he returned to a more hands-on role.
Hot Springs Taxi was the only taxi service operating in the city when Conner was ordered to cease operations. Last April, the Hot Springs Board of Directors approved the Transportation Advisory Committee’s recommendation to approve Spa City Cab Service’s Transportation Permit.
The business opened later that month.