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SF agency may sue California to disclose how it spent millions in Uber, Lyft revenue

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The San Francisco County Transportation Authority estimated the California Public Utilities Commission receives more than $10 million annually in Uber and Lyft revenue in San Francisco. (Sarahbeth Maney/2017 Special to S.F. Examiner)

The San Francisco County Transportation Authority may sue the state in an effort to reveal how it spends millions of dollars in revenue garnered by ride-hail giants Uber and Lyft.

The California Public Utilities Commission has kept that information hidden, according to SFCTA staff. Yet the CPUC has netted $67 million from ride-hail companies and limo companies since 2013, documents obtained by the San Francisco Examiner reveal. Those documents do not show what portion of the proceeds were from Uber and Lyft, as opposed to, say, small-sized local limousine companies, which the CPUC also regulates.

A new report from the transportation authority estimates the CPUC nets more than $10 million annually in Uber and Lyft revenue “from San Francisco alone.”

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At its regular meeting Jan. 23, transportation authority chair Supervisor Aaron Peskin asked staff to explain why the CPUC hid its proceeds.

“The PUC considers that to be highly classified information and won’t tell you how much money they have and what they’re spending it on?” Peksin asked.

Transportation authority senior planner Warren Logan replied, “We asked them how that’s spent and we didn’t get a clear answer.”

Peskin then said, “We should initiate litigation against the CPUC for sunshine. At a minimum.” Peksin’s staff confirmed it was a directive to explore litigation against the state.

The funding questions arose in a broad discussion at the SFCTA concerning the CPUC’s regulation of Uber and Lyft in California. Transportation authority planners explained to their commissioners, who are also on the San Francisco Board of Supervisors, that other U.S. cities charge per-trip fees to pay for administrative costs and to make services available for passengers with disabilities, for instance, which Uber and Lyft do not fully provide.

As part of its own regulatory frameset, the CPUC also requires Transportation Network Companies — the state designation for ride-hail companies like Uber and Lyft — pay 0.33 percent of its gross California revenues on a quarterly basis as part of overall fees into the CPUC’s Transportation Reimbursement Account.

“The project team has not been able to determine how much revenue has been generated from TNC fees paid to the CPUC and how these fees have been used,” transportation authority staff wrote in a report.

The CPUC declined to comment, but the Examiner obtained budget documents from the California Department of Finance that revealed the CPUC netted $67 million in contributions to the account that Uber and Lyft have contributed to since 2013.

The CPUC did not clarify if Uber and Lyft were the only companies to contribute to that account; other ride-hail companies — like Tickengo, which has since rebranded as Wingz — may also have historically contributed revenue to the CPUC.

The account was created “for the purpose of funding any expenses incurred by the CPUC in regulating TNCs, TNC drivers, and TNC vehicles,” according to the transportation authority in its report to commissioners on ride-hail regulations.

The CPUC oversees the safety of ride-hail companies and compliance with a host of issues from the mileage of vehicles to the criminal background checks of drivers.

The reimbursement account has netted growing revenue from Uber, Lyft and potentially other ride-hail companies: It garnered $15.3 million in fiscal year 2013-14, $15.6 million in 2014-15, $16.5 million in 2015-16, and $20.1 million in 2016-17.

This is not the only avenue San Francisco is now pursuing to reveal information related to Uber and Lyft.

At the behest of a subpoena filed by the City Attorney’s Office, Lyft is complying with the order of a San Francisco Superior Court judge to provide four years of records in eight categories, including incentives that encourage drivers to “commute” to San Francisco from as far away as Fresno. Uber is also turning over some data, according to the City Attorney’s Office, but has appealed turning over other data.

Though Peskin directed the transportation authority to sue to discover how that money was spent, “the Transportation Authority is conferring with our attorneys about next steps,” said Eric Young, an SFCTA spokesperson.

At the meeting last Tuesday, transportation authority commissioner and Supervisor Sandra Fewer said San Francisco has an interest in capturing fees from Uber and Lyft, as well.

“I say, any way we can to recover some revenue from them,” she said. “I think we are in terror on our streets with congestion” caused by Uber and Lyft.

Peskin made a direct appeal to the CPUC during the meeting.

“If anyone from the PUC is watching,” he said, “the fact that this public information is not open to local governments, to members of the public, to people of the state of California is just mind-boggling.”

Editor’s Note: An earlier version of this story reported the ride-hail company Wingz was out of business.

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