Taxiing Infrastructure

March 9, 2018

About the author: Bob Crossen is managing editor for WWD. Crossen can be reached at [email protected]

If you’re like me, you often use Lyft or Uber to get around major cities while traveling for work or pleasure. It is an effective mode of transport for an affordable cost, and in some cities, it is influencing infrastructure plans.

In Chicago—where I call home—a 15-cent fee has been added to every Uber, Lyft and similar ride-hailing services with the intent that the money raised in this way will be used to further transportation infrastructure. The money will be used for maintenance and upgrades to the city’s public train system in the Windy City.

Similarly, Philadelphia is expecting $2.6 million per year from a 1.4% tax on each fare that will be used for public schools in the city. A 1% hailing fee in South Carolina has generated millions of dollars for municipalities, as well. Massachusetts has implemented a 20-cent fee per ride, with money going to improvements of roads and bridges. And New York is set to implement a fee, the proceeds of which would be put towards New York City’s failing subway system.

While the plans have largely raised money for transportation initiatives—road maintenance, public transportation upgrades, etc.—it stands to reason similar approaches could be used to fund water and wastewater infrastructure needs.

With President Donald J. Trump’s unveiled budget, the infrastructure plan was made more clear, although it still resembled much of his proposal announced last year. Around $1 trillion in infrastructure upgrades is the goal, with $200 billion of that coming from the government and the rest coming through private investments, particularly public-private partnerships (P3s).

These partnerships have been more commonly found in transportation initiatives, as our sister magazine Roads & Bridges can attest. Their success, however, is not always a home run. Effective projects in Virginia and Florida are outliers, as are failed P3s such as the Indiana Toll Road, where the return on investment was not what was expected and the highway was ultimately given back to the state.

Getting investors on board seems to be the major hurdle, one that has the potential to be offset by a form of fee like that tied to Uber and Lyft, as the money generated could lessen that investment. The real question then is: Where could that fee be applied that would be most effective and appropriate for raising revenue for water and wastewater infrastructure?

What are your thoughts on this approach? Do you think the fees tied to Uber and Lyft will be effective for transportation improvements? What can the water and wastewater industry learn from those programs? Let us know at [email protected].