SF cabs may add credit, debit fare surcharge 

Cab riders in The City, who already pay some of the highest rates in the nation, could get dinged with an additional 75-cent charge for using credit or debit cards to pay their fare.

Since credit card equipment was introduced to cabs in 2002, the level of customers using plastic to pay for their rides has skyrocketed, leaving taxi companies with increasingly large transaction fee bills.

Under a proposal being considered by the Municipal Transportation Agency, which assumed management of taxi operations in 2009, the 75-cent surcharge would help offset those fees.

But many cab drivers are nervous about the potential adverse reactions to the fare increase.

“I think there are going to be plenty of passengers who resent this,” said Mark Gruberg, a driver and spokesman for the United Taxicab Workers organization. “And I’m real concerned that this increase is going to come out of the driver’s tips.”

Other than a 25-cent increase in 2006 to the flag-drop prices — the starting meter rate for cabs — there has not been a fare increase for taxi service in The City since 2003.

Gruberg said he would prefer the 75-cent credit card surcharge to be absorbed into an overall meter increase, which he says is long overdue.

“This should be something that is presented in an open and ongoing discussion,” Gruberg said. “Not some quick-fix scheme that is all of a sudden thrust on the passengers and drivers.”

Even with meter rates leveling off in recent years, San Francisco cab riders still pay some of the steepest fares in the country.

According to a 2007 report from The City Controller’s Office, a typical cab ride costs $16.15 in San Francisco, $1.53 more than the average of six other cities sampled in the study — though the average fare was on par with fellow Bay Area cities San Jose and Oakland.

Many riders are turning to credit and debit cards to pay their fares, which has been an extremely expensive development for taxi companies, according to John Lazar, president of Luxor Cab.

Additionally Mayor Gavin Newsom made a huge push for The City’s taxis to be equipped with credit and debit card processing machines after visiting cities where the pay option was readily available.

In 2002, Luxor was taking in about $20,000 a month in credit card payments. Now, the total is $1 million. Lazar estimates his business pays credit card companies about 3.3 percent in transaction fees — a total that comes out to $33,000 a month.

Even though the surcharge fee proposal is aimed at recouping some of those expenses, Lazar is still unsure if he is supportive of a fare increase.

There is a chance that riders will skip the tip if they are paying an additional fee, Lazar said.

“Plus, I’m a little uneasy about increasing fares when the economy is still struggling,” he said. “It’s a tough deal for sure.”

The MTA board of directors will discuss, and possibly take action, on the surcharge proposal at its Tuesday meeting. If approved, the surcharge will go into effect 30 days later.

Costly cab rides

What it costs now to take a taxi in The City:

$3.10: Start of the meter rate just to step into the cab
$2.25: Price for every mile driven
$0.45: Price for every minute the cab waits for you
$16.15: Average cost for a cab ride in SF

Source: SFMTA, Controller’s Office

wreisman@sfexaminer.com

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Will Reisman

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