What is it?

Proposition L will create a new tax on transportation network companies, like Lyft and Uber, and autonomous vehicle businesses, like Waymo. The tax would be about 4.5% of gross receipts (aka all revenue), which would likely be directly passed on to riders.

We expect the tax to be used to delay Muni driver layoffs for one to two years. Given the realities of the current budget deficit (over $200 million deficit starting in 2026), the $25 million in expected revenue from the tax is not enough to expand any routes or improve services.

Revenues from this tax may only be used to fund some operational costs. But it is not allowed to be spent on capital improvements like new buses or enhanced street safety infrastructure.

Why vote No?

Prop L will increase the cost of rideshare in San Francisco, hurting both drivers and riders, while failing to achieve the stated goals of the tax. At best, it lets Muni avoid cuts and layoffs by two years, but will have to do those anyway unless a larger, more comprehensive funding measure is passed in 2026.

While Prop L sells itself as funding fares for disadvantaged and low-income communities, the true use of the funds will be to delay driver layoffs by about two years. However, given the realities of the looming $200 million budget deficit, this $25 million tax is a permanent band-aid that will fail to prevent layoffs or service cuts in just one to two years.

Insufficient For Long-Term Deficit: This tax could generate up to $25 million in new revenue per year, which would help short-term needs. However, Muni already has a plan which covers those needs. If downtown commuting and parking payments recover to pre-pandemic levels, the funding gap will close. If that doesn't happen, then starting in 2026 Muni's annual deficit will exceed $200 million, a much larger long-term deficit than this tax could solve. At that point, San Franciscans will have to approve a much larger new tax in the 2026 election or find alternate sources of funding.

Duplicate Tax: We already have a 1.5%-3.25% tax on transportation networks—the "SF Traffic Congestion Mitigation Tax" (Prop D in 2019)—which allocates 50% of its revenue to MUNI and 50% to the SF Transportation Authority.

Tax is Too Restrictive: Revenues from this tax may only be used to fund three specific operational costs: 1) maintaining or increasing service levels (i.e. salaries for drivers to delay layoffs); 2) preserving or improving routes which serve schools, libraries, or parks; or 3) discount fare programs for the disabled, seniors, youths, students, or low-income. Prop L funds cannot be spent on improving the cleanliness or reliability of buses, conditions at bus stops, or street safety. Taxes which are highly limited in how they may be spent limit the flexibility of Muni to respond to changing needs.

Tax is Permanent: Once this tax is in place, it can't be removed or reduced unless voters repeal it through a future ballot measure.

Overall, this tax fails to achieve its goals, imposes a permanent tax for a temporary problem, hurts drivers and riders, and is inflexible about how the money may be spent. Vote No.