Ride-Hailing Companies = $3.5M for Boston
Revenue funds transportation projects in the City
Transportation Network Companies (TNC) such as Uber and Lyft bring new transportation options to our city that both increase congestion and generate new revenue for City transportation improvements.
In 2017, 34.9 million TNC rides originated in Boston; in 2018 that number grew to more than 42.2 million, a 21% increase in rides, according to the State’s Department of Public Utilities. Of the rides either originating or ending in Boston in 2017, approximately 74% stayed within City limits. Of all rush hour TNC trips, 15% are by commuters who would have normally used public transit, biking or walking according to a study by the Metropolitan Area Planning Council.
New TNC-related Revenue for Boston
The emergence of TNCs yields new revenue for cities and towns from a state assessment on each ride. An assessment of 20 cents per ride is collected by the State; 10 cents is distributed to cities and towns based on the number of rides originating in each community. The other 10 cents is split between the Commonwealth’s Transportation Fund to support state and city transportation needs and MassDevelopment to support the taxi industry with technical assistance.
In 2018, the first year this new special revenue was distributed to municipalities, Boston received $3.5M, its share of TNC revenue collected for rides originating in Boston in 2017. Cities and towns are required to report to the State transportation projects supported by this special revenue. Boston’s revenue from the 2017 rides originating in the City were used for a variety of transportation projects identified in Go Boston 2030, the City’s long-term mobility plan.
Boston Transportation Projects Supported by TNC Revenue – 2017
|$1,000,000||Safety||Rebuild 3 miles of sidewalks focusing on low-income areas with high pedestrian traffic|
|$509,855||Safety||Restore lane markings, crosswalks, and bike lanes|
|$509,505||Safety||Redesign key intersections with support of a transportation planner and a community outreach planner|
|$279,920||Safety||Create a new construction management team to advance progress on Go Boston 2030 projects|
|$250,000||Safety||Create more pedestrian-friendly Main Street Districts|
|$118,195||Safety||Invest in new safety and sign equipment for the Boston Transportation Department|
|$225,000||Transportation Reliability||Fund studies to implement new curb policy and parking regulations|
|$98,673||Transportation Reliability||Fund senior traffic engineer focusing on signal timing and road safety|
|$500,000||Transportation Choices||Add 18-20 new public bike share stations|
|Source: City of Boston Report on Spending of Funds Received from the Commonwealth Transportation Infrastructure Enhancement Trust Fund|
Addressing congestion and TNC impacts
MassPort has recognized that TNCs are increasing congestion at Logan Airport and has been proactive in attempting to mitigate the congestion. An additional assessment is applied to each ride going to and from the airport: $3.25 for solo rides and $1.50 for shared rides. This additional assessment provides revenue for improving airport-related carpool lanes, dedicated central pick-up/drop off locations and public transportation services.
Mayor Walsh and members of Boston’s legislative delegation support increasing the TNC assessment, arguing that the negative impacts such as increased congestion and carbon emissions due to TNCs are not fully mitigated by the City’s share of the current 20 cents collected on each ride. The Mayor has also supported adding a 6.25% assessment on solo rides compared to 3% for shared rides to encourage more shared trips. The proposed increase would generate new revenue for City transportation improvements.
At the Research Bureau’s 2019 Annual Meeting in March, Mayor Walsh introduced a new pilot program that sets designated TNC pick up and drop off locations in the Fenway neighborhood. As TNCs continue to become more prevalent in Boston, the City should continue to push for measures to mitigate their impact while also effectively using new TNC revenue to fund transportation improvements.