Ride-Share Fees In Los Angeles

The Los Angeles County Metropolitan Transportation Authority (Metro) voted on February 28th, 2019 to study the feasibility of imposing fees on ride-sharing services such as Uber and Lyft. Metro also voted to study the feasibility of implementing congestion pricing in Los Angeles.

The Reason For The Vote

Metro wants to reduce traffic and obtain funding for significant transportation projects in advance of the 2028 Summer Olympics, which will be held in Los Angeles from July 21st, 2028 until August 6th, 2028. Metro is trying to close a $26.2 billion gap in funding (as of December 2018) for 28 transportation projects which are supposed to be completed before the Olympics.

Ride-Sharing Fees

New York City, Chicago and Washington, D.C. have already implemented sales taxes on ride-sharing customers, and ride-sharing fees in Los Angeles would likely be implemented in a similar fashion.

Transportation officials say that Uber and Lyft don’t do enough to maintain public roadways or relieve traffic congestion in locations notorious for traffic congestion, all while profiting off of the use of Los Angeles’s public roads. Researchers have found that Uber and Lyft rides were responsible for 20% of miles driven in San Francisco, and 26% during rush hour. Los Angeles’s transit ridership has seen a 20% reduction in the past five years, even though billions of dollars have been invested in new rail lines. Metro hopes a tax on Uber and Lyft would encourage residents of Los Angeles to use public transportation or carpool instead of riding alone with an Uber or Lyft driver.

Late 2020 is the earliest date that ride-sharing fees could be assessed, and they would require another Metro vote. Metro estimates that a 20-cent sales tax on every ride-sharing trip could raise $401 million in one decade. Metro also estimates that a $2.75 sales tax on every ride-sharing trip could raise $5.5 billion in one decade.

Congestion Pricing

Congestion pricing would essentially charge motorists for driving into areas with heavy traffic during rush hour. Motorists might be charged for access to major highways or freeways during rush hour. New paid-access express lanes may be created. “Corridor charging” might see motorists charged when they drive into heavily congested areas of Los Angeles during rush hour, such as around LAX or in downtown. Milan, London and Singapore have seen success with similar congestion pricing plans, and New York City is also considering congestion pricing.

The Path Forward

Jeffrey Nadrich, Los Angeles car accident attorney, notes that the proposed taxes and congestion pricing, if implemented, could go a long way to easing congestion on the city’s freeways and streets during peak hours. Mr. Nadrich also notes, that “in addition to these proposals, the city will need to continue to expand efforts to develop and make available public transportation to and from underserved areas, such as the San Fernando Valley.”

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