Chicago cab fares going up 20%, as City Council tries to buoy taxi industry

The City Council agreed Wednesday to throw a sorely needed lifeline to Chicago’s shrinking taxicab industry — at the expense of cab riders.

Without a word of debate, the Council agreed to raise taxicab fares by 20%, the first increase in a decade, to help cabdrivers struggling to compete with Uber and Lyft amid skyrocketing gasoline prices and increasing insurance, maintenance and vehicle replacement costs.

Downtown Ald. Brendan Reilly (42nd) cast the only dissenting vote — even after acknowledging that the taxicab industry has been "eviscerated” by rides-sharing — to protest what he called “rampant abuse" by cabdrivers who fail to pull the flag to start the meter when a passenger enters the cab.

The fare hike was introduced by Mayor Brandon Johnson last fall while public attention was focused on the battle over his 2026 budget. It has languished in committee ever since — until Wednesday.

The mayor’s plan would maintain the cost of entering a cab, known as the “flag pull,” at $3.25 for the first one-ninth of a mile, but provide substantial relief for cabdrivers in other ways. That includes a $2.50 rush-hour fee for rides between 3:30 p.m. and 7 p.m., a $1 overnight fee for rides between 8 p.m. and 6 a.m., and increased charges for both time and distance.

Instead of 25 cents for each additional one-ninth mile, passengers would pay 31 cents. Another 31 cents would be tacked on to the fare for every 45 seconds instead of 20 cents for every 36 seconds.

Shared rides for “a minimum of two passengers” would also rise — from $24 to $30 from O’Hare Airport to Downtown or McCormick Place — and from $18 to $22 from Midway to Downtown or the convention center. The cost of shared rides between Midway and O’Hare would rise from $37 to $45. The cost of cleaning up a cab after an inebriated or unruly rider would double, from $50 to $100.

John Moberg, president of Checker, Yellow and American United Cab, said the 20% increase is “long overdue.”

“Everything has gone up. Our insurance has gone up significantly. The cost of vehicles and the cost to repair vehicles has gone up dramatically. And I don’t have to tell you about gasoline. Everybody is experiencing that,” Moberg said. “ Twenty percent will help cover some of that, but not all of it. We probably need more, but it would be worse for us if we raised it too much because it would chase the riding public away.”

Chicago’s once-thriving taxicab industry has been shrinking ever since the unregulated advent of ride-hailing services like Lyft and Uber.

It took years before the city finally stepped in and regulated that industry. By that time, the value of taxicab medallions already had plummeted. A medallion that once sold for as much as $400,000 is now valued at $5,000.

The pool of available drivers also is shrinking — and aging. Anyone who gets laid off or needs to supplement their income can “go to Uber and be driving tomorrow,” while it takes two or three weeks of classes to be cleared to drive a cab, Moberg said.

“ The taxi industry is getting older all the time, and people are retiring or dying. We don’t have an infusion of replacements. They want a quick fix. They want money now. They don’t want to wait six weeks to earn money for a cab when they could walk into Uber and be driving the same day,” Moberg said. “If we got that level playing field, we would have a cab industry that could sustain itself into the future, and we could keep that base. We’d be able to get young people. If not, it’ll dry up.”