Audit of Department of Business Affairs and Consumer Protection Taxicab Medallion Auction and Safety Inspections

Executive Summary

The Office of Inspector General (OIG) conducted an audit of the Department of Business Affairs and Consumer Protection’s (BACP) taxicab regulation during 2013. This audit focused on the medallion auction process and taxicab safety inspections. A taxicab medallion is “the metal plate, furnished by the [BACP] commissioner, for display on the outside hood of a taxicab, as the physical representation of a license to operate as a taxicab.” Regarding medallion auctions, Municipal Code of Chicago (MCC) § 9-112-480 states that “the commissioner shall promulgate regulations to set forth procedures by which all available taxicab licenses shall be distributed,” and that this process “be designed to produce the maximum amount of revenues to the city consistent with serving the public interest.” MCC § 9-112-050 further required that BACP inspect each taxicab at least semiannually.

The objectives of the audit were to determine if,

1. BACP had an auction process that satisfied MCC § 9-112-480;
2. BACP inspected all taxicabs at least as often as required by MCC § 9-112-050; and
3. BACP accurately tracked whether taxicabs found to have safety violations were brought in for inspection in a timely manner.