Yesterday, the city’s transportation board did two things it hasn't done in over a decade: Recommend city council approve the creation of a new cab company and allow more taxis to work in the city.

The new company is called Union Cab, a would-be worker-owned co-operative. There are some strong arguments for why Portland should allow more taxis to operate but Union Cab and the new taxis permits it needs are at the center of controversy that seems to be dividing Portland’s cabbies along ideological and ethnic lines.

Portland’s Private for Hire Transportation Board—which is made up mostly of members of the city’s transportation industry—voted yesterday on whether to add 132 new taxi permits to the 382 that already operate in Portland. The new permits included 82 for three existing Portland cab companies and 50 for the newbie Union Cab. It also included a series of new and potentially far-reaching reforms designed to clean up the poor working conditions found in Portland’s cab industry. However, the crowd seemed to care less about the reforms. For better or worse, yesterday’s fiery meeting was mostly about Union Cab and the new permits.

In total, about 80 taxi drivers packed the Portland Building’s auditorium to give their two cents on the new permits and the new company. And yesterday’s meeting showed a marked division among Portland cabbies.

In the center of the room were about 30 representatives from Union Cab, composed largely of African immigrants. The co-op’s members were led by Union Cab’s founder and current president, an Ethiopian immigrant and taxi driver named Kedir Wako. Next to the Union Cabbies was another batch of partisans, nearly all white and composed mostly of Slavic and Russian immigrants that make up an anti-permit/anti-Union Cab group who support rabble-rousing cabbie Red Diamond, the elected representative for all the taxi drivers on the city transportation board. Diamond has led the attack against the new permits and Union Cab.

Both groups participated in what turned into a very contentious public comment period, during which members from each practically shouted their positions at the board (the two groups also fought with each other to be the loudest clappers in the room). Again and again, Diamond’s partisans questioned the board’s conclusions that Portland needs new permits, repeating the argument that America is still in a recession and the new permits would hurt the drivers by adding more competition to an already fierce market.

Wako’s camp meanwhile, accused Red Diamond of being a closeted racist and not representing cabbies' best interests on the board.

For his part, Diamond used his official position on the board to once again state his opposition to the Union Cab, and to lament that the board had shot down an earlier recommendation he presented to them that would make Portland's taxi system more like NYC's medallion program by taking existing permits away from the taxi companies and giving them to drivers. Diamond also repeated his concerns—also expressed to the Mercury—that the co-op’s members were going to bring non-Portlanders into the new company and take jobs away from local drivers. Diamond told the board and his gathered colleagues:

“I’ve heard from multiple sources on repeated occasions that of those 50 permits, these permits are to be allocated to family members and Union members who are not local people—that is, people who are associated with Union Cab that live in other cities. Until I am satisfied that Union Cab is actually owned by local drivers, I don’t think the city should issue these permits. I think the question of who actually owns Union Cab should be made available to the board.”

To this, the Revenue Bureau’s Kathleen Butler told Diamond the Union Cab’s members were not legally obligated to reveal this information. However, Union Cab is legally registered in the state as a business owned by Kedir Wako, who lives in Portland, though this doesn't list the other member-owners.

While half of the room hooted for Diamond, he didn’t receive a lot of support from the rest of the board. Following a failed attempt to introduce a motion specifically against Union Cab, the board voted overwhelming in favor of the new company. The final vote for the co-op was 10 in favor and three against.

Once the Union Cab issue was settled, members of the co-op cheered, while the majority of the anti-permit crowd got up and left the room, even though the board hadn’t yet decided on the other 82 permits or the new reforms (PDF). Minutes later, in front of a much smaller crowd, the board voted overwhelming to approve the new reforms and the new permits. Only Diamond and one other board member voted against the package, while one member excused himself from the vote altogether.

The board’s thumbs up for the new permits, it should be noted, wasn’t unconditional. Perhaps conceding to concerns made by Diamond and others, the board recommended a gradual implementation of the new permits, with an examination at the end of 2013 to see if the new permits really are hurting drivers. And this isn’t the final word on the new company, permits, or reforms.

On November 7, Portland City Council is expected to vote on the issue. But Diamond told the Mercury he sees defeat already. “I’ll tell you this, and it will make your union friends happy, if all these permits are approved, I’m leaving Portland," says Diamond. "There is no way I can continue to work in this industry if it is decimated by over saturation. I am not going to subject myself to slave wages.”

Not surprisingly, Wako tells a different story. “We are very happy, we are in the right place, and we are in the right country. That's why we came here and we left our parents, our mothers, fathers, and brothers and sisters because this is the place where you can get justice.”