Will San Francisco Taxi Rate Hikes Backfire?
Under intense pressure from drivers who had seen their pay steadily deteriorate since the last taxi fare hike in 2003, the San Francisco Municipal Transit Agency just voted to raise taxi fares and suggested they will raise fares again in the near future.
The charge per mile went up 50 cents and the charge for one minute of waiting in traffic went up 10 cents. San Francisco taxi service, considered by many to be the worst in the nation, is now close to the most expensive. The MTA also said they would likely raise the “flag drop” rate by 40 cents sometime in June, at which time our ragged San Francisco taxi fleet will be the most expensive.
All of these rate hikes are designed to fairly compensate drivers, who have seen their fuel and rental charges skyrocket without any increase in fares. But our latest Reset San Francisco Poll is raising the question – will the new San Francisco taxi rate hikes backfire?
Many Riders Say they Will Stop Taking Cabs
Our Reset Poll tested the nearly 70% rate hike initially proposed. Some rides will now be more expensive than this 70%, most will be less, depending on the final rate hikes approved and the type of ride. But the response we found in our survey should be a caution to both drivers and regulators.
Our online poll of 1,819 likely voters found that fully 50% said they would dramatically decrease their taxi use in the face of such fare hikes. This 50% rate is of the total number of residents sampled. That percentage leaps to 60% of the universe of self-reported taxi users.
While it is fair to say the San Francisco taxi fare increases now proposed no longer total 70% with regularity, we think these numbers are still a wake up call. Riders have choices – and if the rates go too high, they will exercise those choices. And what happens then? The drivers will have fewer customers and their wages could actually go down.
Why Math Matters in Gov 2.0
All of our regular readers know Reset San Francisco is pushing the idea that our city government should spend more time responding to data and less time reacting to the few folks who show up at City Hall. At its very core, that’s what Government 2.0 is all about.
While this is just preliminary data – and it needs to be explored in much greater depth – it points to facts that seem distant from the City Hall culture. What the folks in the “City Family” as they call themselves don’t always seem to understand is that residents have choices. And in this case, if you make taxis the most expensive in the nation without any effort to make the service better, residents might very well exercise those choices and opt-out in large numbers of a poorly run system.
When Taxis Cost the Same as Limos, What Will You Take?
The reality is that with the new fares, many taxi rides will be the same as limo rides. What choice do we think riders will make – particularly since you can now schedule a limo on your SmartPhone? (That’s a technology that the MTA is spending $400,000 to “study” with no promise of when we will actually have reliable GPS enabled dispatch of the taxi fleet).
Car sharing is also taking off in San Francisco, a recognition that access to occasional car use actually helps decrease car trips. It is much easier to walk or bike to work or school with regularity, even much easier to go without a private car, if on occasion a car or taxi is available to pick up those heavy packages or to make a late night trip. If taxis cost too much, don’t work well enough or are simply not available then more people will exercise the option of joining car-sharing services.
Unfortunately, some people will also exercise the option of actually buying and using cars. If two taxi trips a week cost the same as a car – some people will make the choice to buy that car.
The MTA Commissioners and most folks at City Hall seem largely focused on political economics – how they can make the most friends and the fewest enemies of the people who come into “the building.”
Our Reset Survey is a caution to the drivers, who deserve a raise, and the Commissioners who are working hard to get them one – there are also real economics. And if you make San Francisco taxis the most expensive in the nation many if not most riders might do the math and find out that other choices make more sense.