Philadelphia collects 1.4% from ride-sharing, why can’t other cities?

A proposal to do so never made it past a Senate committee.

From Philadelphia to Erie, Pittsburgh to Scranton, ride-sharing services can now operate legally, and permanently, in Pennsylvania. But when Governor Wolf signed the regulation into law, something was missing: a proposal that would have allowed municipalities across the state to collect 1% of gross receipts from ride-share companies Uber, Lyft, and in Pittsburgh, zTrip.

Senator Lisa Boscola introduced the amendment in the Senate’s Rules and Executive Nominations Committee. She was unavailable for an interview, but her colleagues said the proposed fee was modeled after the one in Philadelphia: the Philadelphia Parking Authority (PPA) assesses 1.4% of gross receipts from Uber rides originating in the city, and sends two-thirds of that money to the school district.

The PPA already regulates taxis in the city; in the rest of the state, that’s the job of the Public Utility Commission (PUC). Making sure transportation network companies, as the legislation calls them, comply with the law will follow the same structure: the authority in Philly, the PUC everywhere else, said  Senator Jake Corman, R-Centre County, who chairs the Rules and Executive Nominations Committee. He said Philadelphia is a special case.

“There’s a set rate for the Philadelphia Parking Authority to regulate the [transportation network companies] in Philly, and there’s a certain rate that goes to the PUC,” he said. “Part of the mission of the Philadelphia Parking Authority when it was created was to help fund education in the city of Philadelphia. Part of the dollars they get for regulating the [transportation network companies]…will be then be an offshoot to the school district.”

Corman said he understands why other cities would want to tap into this revenue stream.

“Seems like there’s more and more and different programs [that] give money to Philadelphia schools, or the rest of the state could use some money for their schools, as well.”

But there were two problems, said Corman. First, the Senate didn’t really have time to get into the issue, they were at the end of the legislative session and had to get it out the door. “We voted it down because mostly we needed to get the bill completed.” Second, he doesn’t think the state should be taxing transportation network companies to fund schools.  

“There’s not a lot of businesses where you take an extra assessment fee just for the sake of going to schools or anywhere else. To do that just to this industry as opposed to any other industry just doesn’t seem fair and could run us afoul of some of our equal taxation clauses we have in our constitution.”

The vote in committee split along party lines. Eleven Republicans voted against, and six Democrats voted in favor, said Senate Democratic leader Jay Costa of Allegheny County.

“Myself and my colleagues on the committee…thought it was appropriate for the ride-sharing companies to provide resources to other communities or school districts across Pennsylvania where they provide that service.”

The possibility of this amendment had been discussed, said Alex Pazuchanics, policy coordinator for the city of Pittsburgh.

“I think it was more of a thought exercise, and an evaluation, rather than whether or not it would make it in the bill itself.”

But Pazuchanics said it will be an ongoing discussion as the state, and the country, consider how the sharing economy will impact traditional revenue streams. Electric vehicles could mean a hit to the gas tax, and autonomous vehicles might decrease parking revenue.

“As we’re in the infancy of these new technologies and these new platforms, it’s important to start evaluating what kind of impact they’re going to have on the public and maintaining the infrastructure that they’re built on.”

Corman expects the issue to come up again in the next legislative session.