Baker Seeks Increase in Ride-Hail Service Fees [+Video]

House Speaker Robert DeLeo called the governor's proposal to raise the fees on Uber and Lyft to $1 per ride "interesting," and said the House is also actively considering higher fees on ride-hailing trips as part of the revenue plan the speaker hopes to unveil and debate this winter.

"With both the TNC provision in (the governor's budget) and Senate President (Karen) Spilka's call for additional short-term revenue last night, I am pleased all parties now agree on the urgent requirement for increased transportation revenue," DeLeo said in a statement. "I look forward to working together on a transportation revenue package that addresses the system's urgent needs.”

Baker described the proposal as a response to the proliferation of ride-hailing services, and the contributions they make to congestion and "wear and tear" on roads and bridges. The most recent report on ride-share usage found there had been 81.3 million trips in Massachusetts in 2018, up 25 percent from 2017.

The governor recalled how in December following the release of a damning report on the safety culture at the T, he said his administration would look at ways to make sure the MBTA had the resources it needed to implement the report's recommendations.

"I believe that this gives us the ability to fully support DOT, the MBTA and its agenda, especially around the safety piece and the accelerated service improvements piece. So what I'm basically saying is I think it's consistent with what I said when we were talking about the safety report," Baker said. 

The proposed 80-cent increase to the fees on ride-hailing service trips is part of the governor's strategy to boost funding for public transit in his new state budget proposal. In total, the fiscal 2021 budget that Baker filed on Wednesday would increase support for the MBTA by a total of $134.8 million.

The new money for the T, under Baker's plan, would come from a variety of sources, including $73 million from TNC fees and $40 million in one-time money by accelerating sales tax collections at companies that do more than $100,000 in sales. 

The administration is also estimating a more than $21 million uptick in sales taxes dedicated to the T.

The governor's proposal would generate an estimated $120 million in ride fees, up about $100 million from the current fee of 20 cents per ride, according to the administration. Municipalities would get 30 percent of all money generated, while the state would get 70 percent for use on transportation and the T. Under the current fee structure, municipalities get half, or 10 cents from every ride.

Transportation Committee Co-chair Rep. William Straus said Baker's embrace of higher TNC fees all but assures that they will be included as part of House leadership's final revenue package.

"It's hard to turn away from a revenue increase for transportation that's been agreed to already by the governor," Straus said. "It might be viewed as the floor now for what is appropriate. I don't think there's much chance the legislature will feel a dollar is too much."

Straus also said House leadership might recommend a different revenue-sharing agreement between the state and municipalities from TNC fares. "The significant thing is the governor is now on board with increasing transportation revenue to meet the needs of the system," Straus said.

Budget writers routinely set aside additional money above and beyond the traditional revenue streams to support the operating budget of the MBTA, including $127 million in this year's budget. With the TNC fees, that assistance would climb to $200 million in fiscal 2021, under Baker's budget.

The Raise Up Coalition, a progressive group of labor, religious and community groups, said they worried Baker's plan singled out ride-share users to fund transportation improvements. 

"We need major new investments throughout the state, and working people shouldn't be the only ones asked to pay for those investments," said Beth Huang, director of the Massachusetts Voter Table and a member of the Raise Up Massachusetts Steering Committee.

Massachusetts Taxpayers Foundation President Eileen McAnneny said her organization supports fees on TNC, but would prefer to see a tiered fee structure that rewards people who share rides with other users, such as Uber Pool.

Baker's budget proposal would also increase support for the Massachusetts Department of Transportation by $77.6 million, directing $423.5 million toward the agency. Transportation Secretary Stephanie Pollack said the budget included enough money for the Registry of Motor Vehicles to continue implementing safety reforms following last year's scandal involving unprocessed driving violations from out-of-state.

The governor's budget request includes $800,000 for the Merit Rating Board to fund new employees and improve its business practices.

Pollack said the budget would also advance MassDOT studies into the effective use of managed and high-occupancy-vehicle lanes to reduce congestion, and would provide $94 million in total funding for regional transit authorities, consistent with the recommendations of the RTA task force.

The governor's budget also offers a model of governance to replace the five-member Fiscal and Management Control Board when that entity's authority expires on June 30. 

Baker is proposing a new seven-member board to oversee the MBTA and the Department of Transportation, including a seat for the secretary of transportation and five additional experts in various subject matters, including transportation operations, experience in public or private finance, and a rider, all to be appointed by the governor.

The seventh seat on the board would be a representative from a community that contributes to the MBTA through assessments, and the administration is pitching the idea that the MBTA advisory board would elect that member from its own ranks. At least two members, under the proposal, must also be members of the MassDOT board, and no more than four can be members of the same political party. The MBTA board members would serve four-year terms, with three of them serving terms that end when the governor's term ends.

Boston Mayor Marty Walsh has said he believes that Boston should have a full-voting seat on the MBTA's governing board given its importance to the capital city and the amount the city pays into the T. While Walsh could get his wish, it would not be guaranteed under Baker's plan.

"First of all, I'm always interested in hearing what the mayor has to say, but there are 154, 164 communities that are part of the T service area. I think having them make a decision about who they believe is going to be best able to represent their interests is a better way to go than just picking one over another," Baker said.

In a statement, Walsh said he appreciated Baker's proposal to add a municipal appointee to the board and looked forward to "reviewing his full proposal." "Boston continues to be the largest payer into the MBTA system, and I will continue to advocate for Boston having a dedicated seat and voice on the MBTA board," Walsh said.

Pollack said she looks forward to discussing this plan with legislative leaders, but said that the new governance structure ideally would be approved at least 45 days before June 30 to ensure a smooth transition of power.

Baker said he and his team debated whether to put the governance plan in the budget or file it separately knowing the Legislature has a history of debating the annual budget up until, if not after, the July 1 deadline, but said at least he can guarantee that the budget will get finished.

Another outside section in Baker's budget proposes to transfer responsibility for Morrissey Boulevard, Storrow Drive, Soldiers Field Road and Day Boulevard from the Department of Conservation and Recreation to MassDOT.

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01/22/2020