Panel Selects 2nd Valley Taxi Service : Transportation: A Burbank company is recommended for the franchise. But some commissioners doubt that two cab firms can survive.

A Los Angeles city commission voted 5 to 0 Thursday to recommend that a second cab franchise in the San Fernando Valley be awarded to a Burbank firm even as its members expressed grave misgivings that two cab companies can survive in the Valley.

“I do hope sincerely we won’t be sorry for what we did,” Transportation Commission President Marian Broome ruefully told her colleagues after the vote was cast.

By its vote, the commission backed awarding the second Valley franchise to Babaeian Transportation Co., which has spent more than $100,000 at City Hall on political contributions, lobbying fees and consulting contracts to secure the franchise.

Even so, Broome and two other commissioners said they believed that the demand for cab service in the Valley is insufficient to sustain two firms. City records show that the current franchise-holder, Valley Cab Co., generated $4.5 million in gross revenues last year and provides 38,000 taxi trips each month.

Valley Cab has had a monopoly on cab service in the Valley since 1984.

Commissioner David Leveton said the commission’s debate on whether a second franchise would be viable was a moot point because the City Council decided the issue in June, 1991. Then, the council voted 14 to 0 to direct the commission to pick a second franchisee even though the commission had unanimously voted earlier that a second cab company was not needed.

The council has the final say in all franchise matters and many in the taxi industry predict it will award the contract to Babaeian.

“Irrespective of what the commission does now, a franchise will be approved by the council,” Leveton said of the contract awarded to Babaeian. “I have some reservations about the need for it, but I want my voice to be heard.”

Thus, Leveton argued in favor of supporting the Babaeian company as the best of four bidders.

Leveton also introduced a motion, later approved, to require the firm to put up $300,000 in cash before it formally obtains the franchise to show that it has the financial wherewithal to start up cab service in the Valley. Babaeian, which operates 100 taxis in Burbank, Glendale and Pasadena, could operate up to 85 cabs in the Valley under the franchise.

Babaeian attorney Gil Archuletta disagreed with the gloomy predictions of the commissioners, predicting that “both companies will prosper--it’ll be a win-win situation.”

Competition will sharpen Valley Cab’s services and generate new business for both companies by heightening consumer awareness of cab services in the Valley, maintained Archuletta, who is with the politically influential law firm headed by former Councilman Art Snyder.

But Lloyd Conway, the owner of Valley Cab, predicted that competition will produce a deadly struggle that will either leave only one company triumphant or kill both firms.

Conway’s own firm is the lone survivor of a struggle in the 1970s between two Valley-based cab companies.

Also speaking against the second franchise were Michael Kalin, president of Los Angeles Checker Cab Co. Inc., and Neal Evans, attorney for two driver-owned cab companies, who said the Babaeian bid had a dazzling array of “bells and whistles” but would not fly financially.

Babaeian’s bid “looks wonderful--it’s got Armani suits, drug-testing, Gucci shoes and Rolls-Royces,” Kalin sarcastically told the commission.

In fact, Babaeian’s bid promised an innovative array of services and improvements, city Transportation Department chief Ed Rowe said. Among these: uniforms and mandatory drug-testing for its drivers, 15 “smoke free” cabs that ban cigarettes, telecommunications devices for deaf customers, a 25% discount for the deaf and new cabs, including five that will run on clean natural gas fuel.

No date has been set for council consideration of the franchise issue, according to Konrad Carter, city clerk deputy.