Just past midnight on a Saturday, two women in heels and cocktail dresses hopped out of a cab. The taxi drove another 100 feet, stopped and picked up a couple men waiting for a ride out of the Mission. In seconds, the cab was off with the meter running.

A normal occurrence, except the lack of markings on this taxi indicated it is not licensed to operate in San Francisco. It’s unknown how many illegal cabs operate in the city, with estimates ranging from 100 to 1,500, but the short answer is: plenty. Licensed cab companies and city officials say the proliferation of gypsy or pirate cabs dilutes earnings for legitimate cab companies, reduces tax revenue for the city, and puts riders at risk.

And, with unlicensed limos adding to the fare competition, the number of unregulated rides is growing.

“Have you been out on a Saturday night?” said Christine Hayashi, director of the Division of Taxis and Accessible Services for the Metropolitan Transit Authority (MTA), referring to the problem of illegal taxis and limos in the city.

“It’s insane. They’re everywhere.”

Legal San Francisco taxis can be identified by the police transponder contained in the orange box “about the size of a box of cigarettes” that sits on the taxi’s roof, said Richard Hybels, owner of Metro Cab.

Legal cabs also have a circular decal on the frame between the back door and windshield, as well as other decals reading “San Francisco Taxicab” on the side and rear of the vehicle.

The cab on that Saturday night had none of these markings, and belonged to Air Express, which is not listed on the city’s list of authorized medallion holders.

“It’s hard to go anywhere without seeing one,” said Hybels. “Mission Street in particular is a popular spot for them.”

Operating unlicensed, or “gypsy,” taxis is a very lucrative operation, according to Hal Mellegard, general manager of Yellow Cab. As San Francisco’s largest taxi company, with 1,200 drivers operating 500 cabs, Yellow Cab is also the prime disguise for gypsy cabs.

With one coat of yellow paint, a car can look to most riders like part of the Yellow Cab fleet.

Mellegard said he regularly hears incident complaints about unauthorized cabs from both drivers and customers. Unlicensed cab companies can even have their own listings in the telephone directory, with one “Yellow Cab Co” number being listed as (415) 333-3363, compared to Yellow Cab’s (415) 333-3333. They can also skip the overhead expenses of fingerprinting, background checks and training for drivers, as well as vehicle inspections and insurance.

Hayashi estimated that the phone book lists about 30 illegal cab companies and pointed out that there are actually 18 companies under the name “Yellow Cab” alone.

The Metropolitan Transit Authority, which gained administrative and regulatory oversight over the city’s taxis from the Taxi Commission in March, plans to crack down on these taxis by adopting Senate Bill 1519, a California law adopted unanimously by the MTA board on April 21.

The statute will allow the MTA to file complaints against illegal cab companies, impose a fine of up to $5,000, and get an order from the Superior Court to disconnect telephone service for any unlicensed operator. Previously, the Taxi Commission had no authority over unlicensed cabs, and enforcement was limited to traffic stops by the San Francisco Police Department.

Based on the amount of illegal cab companies in the phone book, Hayashi estimated the fines will contribute “about $150,000” to the MTA’s budget—assuming they all can be collected.

According to taxi companies, gypsy cabs are more than a nuisance, they’re a threat to public safety. Hybels referred to one cab in particular labeled Metro 105. Customers have complained of sexual comments made by the driver, and running people off the road. There is no Metro 105 in the legitimate Metro Cab’s fleet, Hybels said.

The safety problem goes even further, according to Charles Rathbone, assistant operations manager of Luxor Cab. Rathbone said illegal cabs have been implicated in assaults and rapes. The police department’s taxi division could not be reached to independently confirm this fact.

“We’re gonna end up sooner or later with some very ugly situations,” Rathbone said.

The pirate cab drivers disagreed.

“This is something for me to live on until I find another shift,” said Zack, a former cab driver who declined to give his last name. He lost his job after the woman who owned the medallion leased to his company died and the medallion reverted to the city.

To operate legally, drivers and companies must have access to one of the city’s 1,500 medallions, and may spend more than a decade to obtain one from the city’s waitlist. Most drivers working for companies with medallions go through a hiring process that includes training and background checks.

An ex-cab driver of five years, Zack said he can’t find any shifts with other cab companies, but the demand for drivers is still there.

“There’s a lot of people that can’t get a cab,” and waits can extend to 30 minutes or more—a fact anyone out late at night in San Francisco knows well. Zack said the current system of medallions is “fair, but there’s not enough.”

Rathbone agreed that, “When you see large numbers of illegal operators, it’s usually a sign that the supply and demand has gotten out of whack.”

However, he spent 13 years on a waiting list for his medallion and wants to see that protected. “The most valuable asset in my possession is the medallion,” said Rathbone. “In many ways, it’s a safer bet than real estate.”

While the city is planning a trial auction system of 100 of the 1,500 medallions in hopes of raising money for the MTA, Hayashi said there are currently no plans to increase the total number of medallions.

In New York, which uses the auction system, the base rate for a medallion is $500,000, compared to $250,000 for a medallion in San Francisco.

While unlicensed cabs operating in San Francisco are a nuisance for companies, some see the real problems coming from other vehicles.

“It’s the limos … I don’t see too many of the illegal cabs,” said cab driver Shane Kaykendall.

Sal Del Real, an San Francisco taxi driver for 15 years, agreed as he pointed out a white Lincoln Town Car cruising down Mission Street after last call on a Saturday night.

“There’s one right here,” he said.

Riders can easily spot a pirate limo because limousines are only supposed to operate by scheduled appointments and are prohibited from picking up riders off the street. Nonetheless, said Kaykendall, he often sees them cruising down Mission Street or Market Street.

Del Real said the other problem is “out-of-town cabs—they’re all over the place.” While cabs from other areas may drop clients off, they cannot legally pick up fares in San Francisco.

While one cab driver declined to pick up a reporter on the grounds that he was from South San Francisco and couldn’t operate within city limits, other cabs from the East Bay, including an old beat up Corolla labeled Yellow Star, picked up customers on Mission Street on a recent Saturday night.

While SB 1519 restricts unlicensed cab drivers, it does not apply to unlicensed limousines, which the MTA is currently attempting to develop separate guidelines for. Regardless of the new regulations, Rathbone is certain of one thing regarding pirate cabs.

“It’s probably going to become much bigger.”