Walsh pitches ride-hailing fees as traffic solution
Mayor also met with top MBTA officials Tuesday
BOSTON MAYOR MARTY Walsh wants to reduce traffic choking city streets and enhance transit options in the city through a mixture of targeted taxes on ride-hailing services and investments by the MBTA.
On Tuesday, Walsh advocated for both the revenue and the spending ideas during two separate meetings: a legislative hearing at the State House and a closed-door get-together with T officials at City Hall.
At a Financial Services Committee hearing, Walsh pushed for legislation to essentially apply the state’s 6.25 percent sales tax to Uber and Lyft rides while giving a more than a 50 percent discount on that tax to travelers who opt for a shared ride. They would pay a tax of 3 percent of the fare.
That bill would bring in revenue to finance transportation infrastructure and by making the ride-hailing services a little more expensive, it could also cool off a sector that has enjoyed tremendous growth – as the number of rides in the state jumped up 25 percent last year – and contributed to Boston’s traffic congestion, which one firm said is now the worst in the country.
“This bill is about the millions of people who come into the city of Boston every single day whether it’s to work or for tourism or for whatever reason. This is about tackling traffic issues. It’s about tackling the environment,” Walsh said. “And it’s also about making additional revenues so we can reinvest all the money we’re getting from transportation.”
Under the current regulatory regime, the state collects 20 cents for every Uber and Lyft ride, which amounted to $16 million in 2018 split between municipalities, transportation priorities, and assistance for the taxi and livery industries. Trips beginning or ending at Logan Airport are subject to an additional $3.25 per-ride fee.
Another provision of the bill supported by the mayor and filed by Winthrop Sen. Joseph Boncore and Brighton Rep. Michael Moran would levy fees on the companies for the distance traveled by drivers without a passenger in the car during peak hours.
“A lot of us have been sitting in cars behind empty Lyfts and Ubers waiting to drive around and pick people up,” Walsh told lawmakers.
Unlike drives that take customers where they want to go, those passenger-less trips don’t serve any directly useful purpose for mobility, and yet the cars trolling for customers still take up room on city streets. Still, it’s difficult to see how the 20-cent per-mile penalty would give a disincentive to those drivers. The bill assesses those fees on the transportation network companies and specifically prohibits them from charging drivers or riders for that increased cost. Electric vehicles would be exempt from that 20-cent per-mile fee.
Representatives from Uber and Lyft didn’t testify at the hearing, but the companies generally present themselves as complementary to transit systems – not competition.
“We support the Mayor’s goal of reducing congestion and want to continue to work with the city on innovative pilots like new pick up and drop off zones. However, rideshare vehicles represent a small fraction of cars in Boston and new taxes targeting rideshare customers punish Bostonians who don’t have a car while doing little to invest in much needed improvements to transit,” said Uber spokesperson Alix Anfang in a statement.
Walsh said congestion pricing on all cars is not part of the debate around regulating Uber and Lyft.
“That’s a different conversation,” Walsh told reporters. “The conversation isn’t about every other car on the road. It’s about these ride-share companies that charge people to drive.”
Earlier in the day, Walsh met with MBTA General Manager Steve Poftak, Transportation Secretary Stephanie Pollack, Boston Chief of Streets Chris Osgood, Boston Planning & Development Agency director Brian Golden, and the mayor’s chief of staff, Dave Sweeney.
The meeting followed a harsh critique Walsh rendered of a dysfunctional transit service, and his proposal to improve the MBTA in the short-term by investing $9 million to run more commuter rail trains serving Boston, and create more frequent off-peak service on the Red Line. Service on the busiest subway line has been slowed by a June 11 derailment that knocked out signal systems.
“We talked about the urgency of making sure that, short-term, the T’s up and running,” Walsh told reporters. “It was a good meeting. I think it was probably a little overdue, but I think rather than have a back-and-forth in the press and going back and forth about what’s happening and what’s not happening, I think we have to sit down and have these conversations about laying out a plan.”
A couple weeks after the derailment, Gov. Charlie Baker announced his decision to be more aggressive about making repairs even if that means more night and weekend service shutdowns. Walsh sounded amenable to that type of approach on Tuesday.
“I’d much prefer to see delays on the T because of construction than derailments,” Walsh said.
Baker has also filed his own bill to further regulate Uber and Lyft. It would create stricter criminal prohibitions on ride-hailing drivers stalking or harassing passengers, and require the companies to hand over reams of data about where and when trips are taken to better inform transportation planning decisions.
Baker, who has spent the early part of this week at a Republican Governors Association meeting in Colorado, has taken a skeptical view of taxes, but it is an open question how he would handle legislation to hike ride-hailing fees. Asked about the governor’s view on that, an administration official noted the governor’s ride-hailing bill, which would not increase fees, and said he will “carefully review any legislation that reaches his desk.”
The House is readying for a big debate about new revenues to improve transit and other transportation this fall. Rep. James Murphy, the Financial Services Committee’s House chairman, said there has not been any talk so far about folding discussions about Uber and Lyft fees into that bigger legislative process.
“These are independent bills in this committee,” said Murphy, who said the committee will consider the proposals presented before it Tuesday.
Those proposals also include similar legislation backed by Reps. Adrian Madaro and Jay Livingstone, both Boston Democrats, that would also allow communities within the core MBTA service area to impose an additional $2.25 per-ride fee on the services.Placing much of the blame for Boston traffic on ride-hailing drivers, Livingstone said the traffic they create in turn makes traveling by bus on city streets less desirable, thereby encouraging more people to choose ride-hailing instead, making the problem worse.
“Especially with respect to buses, it’s really a negative feedback loop,” said Livingstone, who said the state needs a “tax system that discourages them to some degree – not eliminates them.”