San Francisco’s taxi industry, bludgeoned in recent years by Uber and Lyft, needs to catch up with the changing times to survive.

That’s the assessment of a pair of consultants whose report, released Wednesday, recommends that the Municipal Transportation Agency, which regulates the city’s taxi industry, work with cab companies to improve their service and reduce the number of taxis on the streets to match reduced demand but increase the number of cabs capable of carrying persons with disabilities.

What it doesn’t recommend, despite the wishes of taxi drivers, is what the city and the agency are not allowed to do: Regulate the transportation network companies, specifically Uber and Lyft, that have nearly decimated the taxi industry since their drivers arrived in San Francisco over the past decade.

That oversight falls to the state Public Utilities Commission, not the city.

Kate Toran, director of taxis and accessible services for the MTA, said the goal of the report and its recommendations is to breathe new life, or at least some life, into the failing industry.

“Taxis are an old brand, a known brand,” she said, “but the industry needs to be reinvigorated.”

With the rapid rise of Uber and Lyft, the taxi industry has seen the volume of rides plummet in San Francisco, along with the number of people willing to drive cabs. The downward trend, in turn, has reduced the availability of taxis outfitted to carry wheelchair users.

The report, prepared by taxi industry expert Bruce Schaller and PFM Group Consulting, found that only 17 percent of the people holding permits to own and operate cabs — known as taxi medallions — are paid a sustainable level of income. This has led to fewer people willing to drive cabs, and unfilled shifts have become common. Meanwhile, medallions have dropped drastically in value, and demand for them is nearly nonexistent.

“The MTA is really looking to get the right regulations in place so that the taxi industry can compete,” Toran said,

To accomplish that, the report recommends taxi companies become more customer-friendly by offering mobile-phone apps — like Uber and Lyft — to hail taxis and providing dispatch services, extensive training programs for its drivers and providing wheelchair-accessible taxis.

As an incentive, the report suggests, companies that do those things should be given priority treatment in the SFO taxi waiting area, where waits average two to three hours, and allow cabs to be dispatched from the SFO lot, something that’s not permitted now.

Those companies should also be released from current restraints that prohibit them from offering special or discounted rates — for example, flat rates to the airport or, 50 percent discounts to special events like the Outside Lands music festival. Current regulations require companies to charge the meter rates established by the MTA.

To help boost interest in operating taxi vans to carry wheelchairs, an often time-consuming effort, the report recommends that drivers be offered up to $300 a month to help buy a van and the same amount per month to cover maintenance and operating costs. The MTA now offers a $10 per trip incentive for every run involving a customer with a wheelchair and gives drivers one pass to the front of the line at SFO for each two wheelchair trips completed in outlying areas of the city.

“A healthy taxi industry requires taxi providers to adjust their service to better compete in today’s for-hire transportation market,” the report’s author wrote.

They fell short of making such dramatic recommendations as having all of the city’s 28 taxi companies operate as if they were one with common colors, a central dispatch operation and a single mobile app.

Taxi drivers, interviewed Wednesday while waiting to pick up passengers outside the Marriott Marquis on Fourth Street, had mixed reactions to the plan. Everyone liked the idea of shorter lines at SFO. Some thought the idea of special pricing, especially flat rates, was a good idea, and some, like Tony Alonzo, understood the need for more accessible taxis.

Alonzo, 36, a San Francisco native living in Oakland, said he used to drive a ramp van and pick up people with disabilities, often taking them to doctors’ offices or the hospital. He enjoyed the people, and the work, he said, but it took more time and effort to push people in and out of the van and secure them, and the financial incentives didn’t make it worthwhile. Add to that the higher cost of gas, and the drivers come up short.

“I feel bad for all the disabled people,” he said. “But if you’re driving a van, you should definitely get paid more. You can’t go home with that kind of money and support a family.”

Although the MTA can’t regulate Uber and Lyft, some drivers say the agency should try anyway to limit the number of cars the companies put on the streets. Sami Dufour, 58, a taxi driver for 17 years, dismissed the consultants’ report.

“All of this is BS,” he said. “They are just distracting us from the real problem — Uber.”

Dufour pointed out that the city’s sanctuary policy and its marijuana laws defy federal law, and suggested the MTA try to override the state Public Utilities Commission.

“If they can ignore the federal government,” he said, “they can ignore the CPUC.”

As a next step, MTA officials plan to gather comments from the taxi industry and anyone else who’s interested at three town hall sessions and at a taxi advisory committee meeting in May. They’ll consider the comments and make recommendations to the MTA Board of Directors near the end of summer, Toran said.

“I think there’s something for everyone to like, and a lot to talk about,” Toran said of the consultant’s report.

And while some people may not lament the downfall of the taxi industry, which, the report acknowledges, itself essentially invited Uber and Lyft with “an under-supply of taxis and limited service in the outer areas of the city,” there is a value to having a city-regulated, on-demand ride service.

“If taxis go away and the other services surge-price, or they don’t serve some neighborhoods,” she said, “the MTA will have no say over that.”

Michael Cabanatuan is a San Francisco Chronicle staff writer. Email: mcabanatuan@sfchronicle.com Twitter: @ctuan