www.baltimoresun.com/business/bs-bz-taxi-rate-order-20140729,0,4138006.story

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Baltimore taxis must accept credit cards by end of year, state regulators rule

PSC cites lack of reliable revenue data in decision against rate hike in years-long case

By Kevin Rector, The Baltimore Sun

10:10 PM EDT, July 29, 2014

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State regulators on Tuesday rejected rate increases for taxis and ordered all operators to install new credit-card-reading smart meters by the end of the year.

The Maryland Public Service Commission said the new meters will bring more predictability and better service to customers hailing cabs in Baltimore city and county, while providing better financial data for use in future rate reviews.

The commission cited the lack of reliable data as a major reason for rejecting rate increases. The commission's staff had proposed an 18 percent city fare increase and a 14 percent county fare increase but based that analysis on incomplete data.

With "spotty, unreliable, and inconsistent data," the commission said it was unable to reach "an adequate determination of revenues sufficient to enable common carriers to provide transportation services under honest, economical, and efficient management."

It rejected increases because of that, it said — a decision made easier by the fact that many city taxi drivers didn't want them.

Several months ago, drivers who hold their own permits but work under Veolia Transportation, which operates the city's Yellow, Checker and Sun fleets, began opposing rate increases in the face of increasing competition from car-for-hire apps such as Uber and Lyft, said Dwight Kines, a Veolia official involved in negotiations with the PSC.

In response, Kines sent the PSC a letter indicating that Veolia — the largest operator of taxis in Baltimore — was ending its support for a hike.

"We were against the increase on behalf of our permit holders, who once upon a time supported an increase," Kines said Tuesday. "Obviously, with the influx of these illegal transportation apps, their revenue is getting squeezed."

The legality of the apps still is being reviewed, also by the PSC, but they haven't stopped operating in the city. More than 30 Maryland cab companies have filed suit against Uber, demanding unspecified damages for upending the state's cab industry.

The app companies have said they don't violate the law and offer consumers more transportation options.

The new electronic meters required by the PSC, due in all taxis in the city and county by Dec. 31, must accept credit cards and print passenger receipts. They also would have to display rates and any add-ons, such as for travel outside of a cab's jurisdiction, as well as Baltimore's per-passenger tax. They also must compile operating statistics that enable better financial record keeping.

The commission gave the companies 60 days to report whether the meters could electronically submit operational data and email receipts to customers.

The commission said it does not believe "the relatively small cost of the meters, printers, and rear seat payment systems presents a burden to taxicab owners," and ordered that owners "not pass on the costs of any of the new in-cab requirements to drivers, either directly or through an increase in lease rates."

Kines said the cost of the meters won't be a major burden for Veolia — which already has meters with card-reading capabilities in many cabs. However, the timeline is tight for installing the systems, which the PSC said must include a "rear-seat payment center" for credit payments, he said.

"It's good policy and it definitely improves cab service, but getting it done by the end of the year is unreasonable," Kines said. "I'll definitely be asking for an extension."

The changes could be a financial issue for drivers who own their own vehicles and will be personally responsible for the costs, Kines said.

The case got its start in 2009, when taxi drivers challenged a drop in a fuel surcharge pegged to fluctuations in fuel costs. In response, the commission determined that fresh reviews of rates and of the number of permits in the region were needed.

Aside from the new meter requirements, the PSC also introduced measures to streamline financial reporting from taxi companies moving forward, and new rules governing permits in the Baltimore area — including new policies for evaluating applications for wheelchair-accessible cabs and for revoking permits from drivers who don't drive at least 12,000 miles a year.

krector@baltsun.com

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