A preliminary financial review revealed that Uber overcharged riders nearly $1.8 million in downtown Chicago due to an incorrect application of a congestion fee between January and April of this year.
The rideshare company acknowledged the mistake, attributing it to an “internal error” that mistakenly added a $1.50 surcharge to rides originating or ending in the downtown area outside the designated congestion hours of 6 a.m. to 10 p.m.
Details surrounding the wrongful surcharges came to light following a Freedom of Information Act request filed by Block Club, which prompted city officials to disclose the total amount, previously withheld.
The excess charges involved approximately 1.2 million rides during the stated period, raising significant concerns regarding operational transparency and accountability.
Last month, Uber initiated the process of refunding the affected riders, a move that followed increased scrutiny from both the public and city officials. However, the refunds were only prompted after Block Club’s investigation and subsequent reporting highlighted the issue, despite numerous customer complaints and at least one formal grievance filed with the city’s 311 complaint system.
The congestion fee, which was initially introduced in 2020, aims to alleviate traffic congestion in a specific downtown zone, defined as stretching from North Avenue to Roosevelt Road. Earlier this year, the fee’s scope was expanded in an effort to generate an additional $8 million from rideshare services, as the city faced a significant budget shortfall.
Uber’s misapplication of the congestion fee coincided with the fee revision that took effect in January, resulting in substantial financial implications for both the company and its riders. According to records, the city’s finance department had been collecting the congestion fees from Uber at the rate of nearly $2 million per month, with revenue reportedly increasing to nearly $3 million by March of this year.
After discovering the overcharges, Uber has requested that the city refund the amount collected through the erroneous fees, stating through spokesperson Josh Gold that they are seeking a credit for future payments as is customary procedure for overpayments.
However, the city’s finance department has yet to publicly comment on this issue, leaving stakeholders in uncertainty regarding the resolution of the financial discrepancy.
The revelations surrounding Uber’s overcharging practices have prompted multiple responses, including a City Council hearing and an internal investigation by the city’s business department. Furthermore, concerns have emerged from community organizations advocating for the rights of Uber drivers, who have expressed dissatisfaction over the growing costs of rideshare services and a general lack of transparency in the fares.
In response to the ongoing debate regarding fare structures and driver wages, Ald. Debra Silverstein, chair of the City Council’s Committee on License and Consumer Protection, has scheduled a hearing to address issues around congestion fee overcharging. Gold confirmed that Uber representatives will attend this meeting to provide their insights.
“The unauthorized surcharge imposed by Uber, without the city’s approval or public disclosure, demands answers,” Silverstein said in a statement.
Additionally, another new ordinance is being proposed by Ald. Mike Rodriguez, aiming to increase driver compensation to $1.50 per mile and 62.5 cents per minute by July 2026. This proposal mirrors an existing ordinance in New York City and would require clearer fare breakdowns for both riders and drivers.
While Uber and certain council members have expressed concerns that the ordinance could lead to increases in fares for riders, proponents, including members of the Chicago Gig Alliance and SEIU Local 1, argue that such measures are essential for enabling drivers to earn a living wage and sustain themselves.
Participants in a recent press conference noted the growing difficulties drivers face, emphasizing the need for improved compensation and fairer practices within the rideshare industry.
Uber reported impressive earnings last year, closing with its “strongest quarter ever” in 2024, significantly boosting its net income to approximately $9.8 billion according to details from their earnings call earlier in the year.
This financial success contrasts sharply with the experiences shared by rideshare drivers, who have witnessed a 54 percent increase in the average fare in Chicago from February 2019 to February 2024, as highlighted by a study from PowerSwitchAction, a nonprofit advocating on behalf of rideshare drivers.
Chicago city officials have relied on rideshare taxes as a key revenue source, raising around $200 million last year through various ground transportation fees.
Aside from the downtown congestion fee, the city also imposes several fees on rideshare rides, which include a $1.13 ground transportation surcharge, a 10-cent accessibility surcharge, a 2-cent administrative fee, and a $5 special venues surcharge for specific locations such as O’Hare and Midway Airports.
Thus far, proposals to increase local rideshare service taxes have fallen short, as the Illinois General Assembly had previously attempted to enact a new 10 percent tax on local Uber and Lyft trips amidst a budget crisis threatening significant public transit cuts affecting thousands of Chicagoans.
The ongoing scrutiny of Uber’s charging practices and the additional legislative proposals may significantly alter the rideshare landscape in Chicago moving forward.
image source from：https://blockclubchicago.org/2025/06/11/uber-overcharged-riders-nearly-1-8-million-in-congestion-fees-city-records-show/
