Mayor Lori Lightfoot proposes tripling ride-share tax on solo rides in or out of downtown Chicago - Chicago Tribune

Mayor Lori Lightfoot will seek to more than triple the tax charged on most solo ride-share patrons heading in and out of downtown Chicago as part of her plan to reduce congestion and raise much-needed money to shrink a massive estimated $838 million shortfall in the 2020 budget.

Lightfoot’s plan to bring in new revenue and curb traffic congestion would hike the tax on solo riders using services like Uber and Lyft elsewhere in the city by 74%. That’s despite the fact most outlying neighborhoods don’t face nearly the heavy traffic problems seen in the downtown area.

The new mayor has said for months she would try to address Loop congestion with a new ride-share pricing structure.

Ride-share trips in Chicago currently are assessed a flat 72 cents per ride in taxes and fees. Under Lightfoot’s plan, that would drop to 65 cents for shared trips and increase to $1.25 for single riders.

This is the area where the city is proposing an increased fee for ride-sharing.(City of Chicago)

Proposed ride-share fees

Downtown zone charge would apply weekdays between 6 a.m. and 10 p.m.

Source: City of Chicago

But the largest increases would be in store for trips involving downtown during peak hours, where solo riders would pay a total of $3 in taxes and fees, while shared trips would pay $1.25 total, under the plan.

In 2018, Chicago raised $110 million in ride-share taxes. The administration hopes to make an extra $40 million under its proposal.

Over the past several months, Lightfoot repeatedly has talked about wanting to give people incentives to use “car pool” services offered by Uber, Lyft and Via because multiple passengers in a single vehicle create less traffic.

An extra $5 currently charged for trips at the airports and McCormick Place would remain unchanged, under the proposal.

The extra charge on downtown rides would be in effect from 6 a.m. to 10 p.m., officials said.

Asked whether tripling the tax on single riders downtown is too steep, Business Affairs and Consumer Protection head Rosa Escareno said the mayor’s plan is meant to incentivize shared trips, which happen often on the West and South sides. Downtown has a diverse range of transportation options, including the CTA and walking, she said.

“If you choose to take a single ride and essentially hire a chauffeur, that’s a choice you make,” Escareno said.

Lightfoot policy chief Dan Lurie said the vast majority of shared rides are on the South and West sides and the city doesn’t want to penalize people who carpool.

The downtown area includes the central business district, Near North Side and West Loop, the mayor’s office said.

Chicago ride-share use has grown by 271% in recent years, the mayor’s office said.

Before Lightfoot released her new ride-share tax plan, Uber argued the mayor should not hike costs on rides in outlying neighborhoods, saying those parts of the city don’t suffer from heavy congestion and residents there need the ride services to make up for a lack of public transportation options.

The ride share companies criticizied the proposed increase, saying it would hurt low-income areas.

Uber spokeswoman Kelley Quinn released a statement Thursday hitting Lightfoot for a proposal she said would “take money out of the pockets of riders, who rely on apps to get around, and of drivers — half of whom live in the South and West sides of the city.”

“As a candidate, the mayor said she was committed to equity, yet she is proposing to hike taxes by nearly 80% on underserved communities who do not contribute to congestion and lack reliable access to transportation,” Quinn said.

Lyft said that while it favored incentivizing shared rides, the increases were too high across the board. Nearly 40% of Lyft rides in Chicago start or end in low income areas, and increased costs can hurt those who need these rides, the company said.

“The Mayor’s proposal shows a total misunderstanding of what causes congestion and how Chicagoans are moving around the city," said Lyft spokeswoman Campbell Matthews. Matthews said that by adding on to already-high fees, the mayor is “clearly backtracking" on her campaign commitments to not increase fees that hurt low-income Chicagoans most.

Ride-share companies like Uber and Lyft entered the market on a promise to supplement public transit and help ease traffic congestion.

But data collected by the city and now made public shows almost half of Chicago’s millions of monthly ride-share trips are taking place in just a few wealthy, crowded and already transit-rich areas, adding to concerns that ride-sharing was contributing to traffic in the busiest neighborhoods.

A Tribune analysis of ride-share trips that occurred in March shows that more than 4 of every 10 passenger pickups happened in five of the city’s community areas — the Loop, the Near North Side, the Near West Side, Lakeview and West Town. Many of the drop-offs were concentrated in those areas too.

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Ride-share companies have countered that they want to help take private cars off the street. City data backs up their claims that they are serving low-income areas where, historically, cabs have been less likely to go.

In a statement, Lightfoot touted the proposed plan, which would go into effect Jan. 1.

“Our city, like many others across the nation, has experienced skyrocketing congestion growth due in part to the rapid growth of ride-hailing companies, making it increasingly difficult for those who rely upon Chicago’s streets for commerce or transportation, and plaguing our downtown,” Lightfoot said. “Using an evidence-based approach to combat our congestion challenges, Chicago is taking these first steps to improve mobility and further our goals of ensuring sustainable, affordable and reliable access to transportation options in every neighborhood.”