The Massachusetts Senate quietly voted last week to extend a per-ride fee tacked onto all rideshares, and debates have begun over whether to raise or redesign the fee to get more transportation funding to cities and towns impacted most by the vehicles.
There was a more than 40 percent increase in rideshare trips in Massachusetts from 2017 to 2024, according to state data reviewed by the News Service, and there were more than 103,000 approved rideshare drivers as of last month. The ubiquitous rider services offer convenience for users while putting more vehicles on the roads.
Massachusetts in 2016 was the first state to implement a per-ride assessment on ride companies like Lyft and Uber, the latter of which is warning against a “mobility tax.” The state collected $18.17 million in 2024 from the 20-cent fee established in the 2016 law regulating transportation network companies (TNCs).
Municipalities receive half of the amount collected every year based on the number of rides that originated in their communities, and put the funding toward projects addressing impacts of transportation network services on roads, bridges and infrastructure. The other half is distributed to the Commonwealth Transportation Fund.
But the provision that established the fee in 2016 is set to sunset in January 2027.
The Senate on Thursday passed a Transportation Committee Chair Sen. Brendan Crighton amendment — within a bundle of other amendments adopted on a single voice vote — to its surtax supplemental budget that would preserve the existing TNC fee structure by eliminating the sunset clause in the 2016 law.
“It’s a good thing, right, because that money’s important to cities and towns. But obviously we’re still not in line with other states and municipalities with regard to the amounts we charge,” Transportation for Massachusetts Policy Director Pete Wilson said.
The fee’s future was not addressed in the House version of that bill, and a team of six lawmakers charged with developing consensus legislation will determine the outcome of the Senate proposal.
A 2024 rideshare data report produced by the TNC Division of the Department of Public Utilities (DPU) shows Boston received more than $3.8 million from rides in 2024, most of which it used for a Bike Share Network Expansion. Lawrence received more than $95,700, which it said would go towards enhanced pavement marking in its downtown. Concord brought in more than $7,800, using it on a crosswalk improvement project.
“This will result in no disbursements to municipalities from the Rideshare Trust Fund in 2027 and beyond,” the DPU wrote to municipal officials in a Feb. 25 alert. The division plans to continue tabulating the number of rideshare trips originating within each city or town and publishing the data in an annual report.
Speaking to Transportation Committee officials on March 3 about Gov. Maura Healey’s transportation bond bill, Wilson suggested it could be a vehicle to revisit the fee.
“We’re at 20 cents. There’s been multiple proposals of, whether it’s a percentage fee of the total cost of the ride, or just a flat rate,” Wilson said. “I think this is a worthy opportunity to look at how we structure those fees and who’s in charge of them.”
The state has collected more than $100 million from ride companies since the fee was put in place, according to the 2024 report. Published in June 2025, it shows the companies provided 90.9 million rides that started in Massachusetts in 2024. Of the 351 cities and towns, 346 had at least one pickup that year. According to a map within the report, the towns of Monroe, Rowe, Heath, Sandisfield and Hawley had no recorded rides that year.
There were about 64.8 million trips that originated in Massachusetts in 2017, according to DPU’s first rideshare report, and the number rose to 81.3 million in 2018 and 91.1 million in 2019. Rides fell in 2020 to 35 million due to the pandemic, but have risen since. Rides in 2024 increased by 15.4 percent from the 78.7 million rides in 2023.
There were 103,588 approved rideshare drivers operating in Massachusetts as of March 11, according to DPU.
Several lawmakers who negotiated the 2016 law remain on Beacon Hill. Senate President Karen Spilka, House Speaker Ron Mariano, House Ways and Means Chair Aaron Michlewitz and Sen. Jamie Eldridge were four of six conference committee members tasked with negotiating the chambers’ dueling bills, which were split on the fee concept. While the Senate proposed a 10-cent fee, the House proposed none. The final bill, with the 20-cent per-ride fee, came out of conference late at night on the final day of the 2016 legislative session.
Gov. Charlie Baker signed the law, which led to a DPU division to regulate ride services, and a two-tiered background check system in which both the state and transportation company review people applying to drive. It mandated that the 20-cent fee does not get passed to either the rider or the driver. Of the 20 cents, the bill originally required that half would go back to the municipality where a passenger is picked up, five cents would go to the state Department of Transportation and five cents to MassDevelopment for grants to help the taxi and livery industries improve technology and provide workforce development for drivers. The money for the taxi industry sunset after five years, while the other surcharge will sunset after 10 years.
“My guess is that the reason there was a sunset is because we really didn’t know what would be the right number to charge per ride. And my educated guess is that we would be revisiting it, about whether to keep it the same or to increase it,” Eldridge said when asked why lawmakers decided to sunset the fee.
“It was just, ‘Okay let’s put this into place for ten years.’ At that time, Uber and Lyft were really just beginning, so obviously there were TNCs who said there should be no charge, there were advocates who said there should be a higher charge,” said Eldridge, who chaired the Financial Services Committee at the time.
“We set it at a pretty low rate,” he added. “My personal opinion is that the ride fees should be raised, because we have a need for more investment in transportation, especially with this money going to cities and towns.”
Aspects of the transportation system have been fraught for years, especially at the MBTA, and both the T and transportation at large have benefited from new revenues added by a 2022 income surtax on high earners.
“I don’t want to speak for the entire conference committee but our thinking on the sunset was that it was a new program at the time and we wanted to see how it would work and see how both riders and the companies handled it,” Michlewitz spokesperson Blake Webber wrote in an email. “We are cognizant of the sunset and are open to options on what happens after January 1, 2027.”
Baker in 2021 vetoed a proposed fee structure passed by the Legislature within a transportation bond bill, arguing that they needed to understand post-pandemic ridership before putting new fees “incentivizing certain travel behaviors” in place. That proposal would have raised the 20-cent flat fee for every ride to 40 cents for a shared ride, $1.20 for a non-shared ride and $2.20 for a luxury ride.
Crighton said in March he had heard from colleagues about the issue, and knew that municipalities were hearing about it too. A bill (S 2253) he filed, which was sent to study, would have implemented a percentage-of-fare fee structure for rides and repealed the sunset provision in the 2016 law.
The state has “a pretty low fee comparably” to other states, Crighton said, and a percentage structure would raise revenue for municipalities and recognize that TNCs have a significant impact on roads and congestion.
Other cities and states are capturing more funding from rides, Metropolitan Area Planning Council Senior Government Affairs Specialist Georgia Barlow said. According to an August 2024 council report, transportation network companies are subject to regulatory fees in at least 39 cities and counties, 20 states and the District of Columbia. Assessments are charged using either a flat per-trip rate or a percentage of a rider’s total fare.
“This is one of the few flexible, dedicated transportation dollars they receive, so if we were to increase the 20-cent fee to capture additional dollars based on how long the ride is, or the time of day, they’d be able to invest in infrastructure that may offset some of the impacts of Uber and Lyft,” Barlow said.
“It’s challenging, as we’re going into a hard revenue year for cities and towns, if this were to sunset at the end of the year,” Barlow added. The law also only applies to rides with passengers, and not delivery services like Instacart and UberEats, Barlow said. The council included recommendations in its report, including that the state consider adopting a percentage fee mechanism; adopting a surcharge for downtown areas to discourage rideshare congestion and encourage transit use; and adopting an assessment that encourages shared rides.
Legislating about rideshares has taken several forms over the last decade. The city of Chicago has a Ground Transportation Tax on transportation network providers that differs between single rides ($1.13) and shared rides (53 cents). The city recently expanded its congestion zone, which adds $1.50 per trip for trips starting or ending in the zone between certain hours of the day.
New York City and state implement various fees reflected on rider receipts, including a state congestion surcharge, TNC fee and MTA congestion fee. Seattle has a 42-cent flat fee on TNC companies, and Portland in 2025 increased its TNC fee from 65 cents to $2. Connecticut, California, Alabama and Maryland are among states with varying per-ride fees. In Philadelphia, Mayor Cherelle Parker recently proposed a $1 per-ride fee to help fill a school district deficit, which rideshare companies have said will hurt drivers and riders.
Referring to various cities’ newer fees, Wilson said, “I think that’s the broader conversation moving forward. ‘Okay, it’s 20 cents, but that was 10 years ago.'”
“This is one of the fees that is set in statute, so it’s unlike your car registration fees or DCR park fees, if you go to a park, which is under the purview of the governor and [the Executive Office of Administration and Finance] to change and adjust on a yearly basis, if they so choose,” Wilson said. “It may not be a bad idea to move the authority to change the fees out from under the Legislature and put it under an executive branch agency, or A and F, where they could change them annually if they so choose. And then it doesn’t take an act of the Legislature to change them.”
The conference committee that will likely be negotiating the spending bill in the coming weeks or months could determine whether the lawmakers move forward with the provision to eliminate the sunset, go a step further or choose not to touch it.
“Massachusetts has set a national gold standard for driver earnings and benefits, but that progress is at risk if we price out the very people who rely on us most,” Uber Public Affairs Manager Katie Franger wrote via email when asked if the company has a stance on the potential for the fee in Massachusetts to expire or change.
“We look forward to collaborating with lawmakers to ensure that new transportation policies don’t become a ‘mobility tax’ on our communities. Our goal is a sustainable funding model that preserves equitable, affordable access to transportation for every resident in the Commonwealth,” Franger said.
Speaking to the fee sunset before the Senate voted to eliminate it in its version of the supp, Crighton said he thinks “there are a number of vehicles that could be available should the Senate or Legislature choose to move forward with alternatives to make sure this revenue source is not lost for municipalities.”
“Municipalities are hurting for revenue, they’re impacted by TNC usage on roads,” the Lynn Democrat said. “There’s a strong case to be made on this.”