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Beale Defends Proposed 50-Cent Surcharge on Cab Fares Paid by Credit Card

By Ted Cox | February 16, 2016 3:44pm
 Ald. Anthony Beale wants to impose a 50-cent surcharge on taxi fares paid by credit card.
Ald. Anthony Beale wants to impose a 50-cent surcharge on taxi fares paid by credit card.
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DNAinfo/Ted Cox

CITY HALL — The head of the City Council's Transportation Committee defends a proposed 50-cent surcharge on taxi fares paid by credit card as a way to put money back in cabbies' pockets.

Ald. Anthony Beale (9th), chairman of the committee, said Tuesday that his proposed ordinance is simply meant to address a 50-cent charge credit card companies typically place on each transaction.

"It's the credit card companies that are really the ones at fault," Beale said.

"The cabdrivers are already hurting for money, and they're just trying to make ends meet, and that's just taking money out of their pockets," he added.

Cabdrivers and the taxi industry immediately embraced the proposal.

 Ald. Anthony Beale and the taxi industry both say the surcharge is necessary to keep cabs competitive with services like Lyft.
Ald. Anthony Beale and the taxi industry both say the surcharge is necessary to keep cabs competitive with services like Lyft.
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"The Illinois Transportation Trade Association supports Chairman Beale’s effort to assist Chicago’s struggling taxi industry," said spokeswoman Mara Georges. "It’s one step toward a more level playing field, instead of the city’s current lopsided support of the multi-billion-dollar ride-sharing industry."

Beale acknowledged that part of his motivation for proposing the surcharge to benefit cabbies is that ride-hailing services like Uber and Lyft "are puttin' a hurtin' on 'em."

David Kreisman, spokesman for local cabbies' nascent union, echoed that, saying, "Since the City of Chicago legalized the unfair playing field between the highly regulated, licensed, professional cab industry and unregulated ride-share providers, the cab industry has been struggling mightily."

According to Kreisman, "Cab Drivers United/AFSCME Local 2500 supports Ald. Beale’s proposed 50-cent surcharge on credit-card payments."

Riders, however, weren't so keen on the proposal. Melissa Peak, a visitor from Kentucky, said it could even backfire and send riders to Uber and Lyft.

"Customers are gonna choose based on what they want to spend," she said. "You can pay the 50 cents or go with Uber."

Kevin Londos, of suburban Vernon Hills, added that it was unfair to pass the cost of the credit card transaction entirely on to riders.

"Cabbies are gonna have us foot the bill," he said. "At the end of the day, it's just ridiculous they even have a trouble taking a credit card. Everything's electronic these days. No one carries cash. So that should be part of the technology."

Beale emphasized that the surcharge would not affect the city's new taxi apps, Arro and Verifone, as credit cards are already included in those systems, same as ride-hailing apps for Uber and Lyft.

The surcharge would provide an instant boost to independent cabbies with their own taxi medallions, but Beale emphasized it would also benefit major carriers such as Flash Cab and Yellow Taxi.

Kreisman agreed, saying, "It is important to note is that the 50-cent surcharge doesn't go to back to the drivers, but straight to the affiliations to help them cover the equipment and other costs involved in providing safe and secure credit-card transactions."

Kreisman said it didn't go far enough, adding, "Given the climate facing cab drivers following the city’s choice not to treat ride-share services like the cabs they are, lowering the credit-card fees is a positive step, but is still not the type of comprehensive reforms drivers and the public are demanding."

"I've gotten nothing but positive feedback," Beale said, citing "a flood of calls from cabdrivers thanking me for helping them out."

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