Study What (e.g. Cadillac)
The state agency that operates the subways, buses, and commuter rail lines in New York City is considering charging drivers as much as $23 to enter Midtown Manhattan. The congestion pricing plan is the first of its kind in the United States, but its proposed new fees have been met with widespread opposition.
In a research note released on Monday, Matt Fabian and Lisa Washburn of Municipal Market Analytics argued that “charging cars up to $23/day would be politically and economically explosive.”
According to an Environmental Assessment report published by the MTA last week, the average round trip cost per vehicle from Princeton, New Jersey to the Manhattan district south of 60th Street would be $120 with the additional toll. New York’s Dutchess and Putnam County drivers would pay an average of $111.
Daniel Solender, head of municipal securities at Lord Abbett & Co., which holds MTA debt, said, “The numbers just do seem so high in terms of what people need to pay that it seems like something that a lot of people aren’t going to be able to afford.” There may be opposition based on concerns about the cost to individuals and the diversity of those who stand to lose under this plan, as stated in the accompanying quote.
In 2019, legislators across the state voted in favor of the congestion pricing plan, and the MTA expects federal approval to follow later this year. Some federal lawmakers who had been opposed to the plan from the beginning voiced their opposition after seeing the Environmental Assessment report’s projections of costs to drivers.
Both Republican Nicole Malliotakis of New York and Democrat Josh Gottheimer of New Jersey have spoken out against congestion pricing, claiming it places an undue financial burden on their constituents. On Monday, lawmakers demanded an investigation into how the MTA spent the $15 billion in coronavirus aid it received to make up for lost farebox revenue over the past five years.
“The state should immediately demonstrate its funding alternatives,” they urged.
New York Governor Kathy Hochul announced on Monday that she will push forward with congestion pricing despite public opposition. It’s possible that the new tolls will debut by the end of 2023.
The tolling plan’s advocates have claimed that it will reduce pollution. The environmental impact statement predicts a 9% decrease in district traffic and a 2% increase in overall public transportation usage.
Congestion pricing “is designed to deal with something that’s really a danger to our economy and our region which is this incredible congestion we have in the central business district,” MTA CEO Janno Lieber said in an interview on WNYC on Wednesday. “We’re trying to reduce traffic violence as a means of improving air quality, health, congestion, and the economy.”
It is expected that congestion pricing will generate about $1 billion annually, which will be used to help pay off $15 billion in debt that the MTA has incurred to fund its $51.5 billion multiyear capital plan.
The MTA’s capital plan relies heavily on the money raised through congestion pricing, which will be used to repair and modernize the subway system, which has been neglected for decades. More all-electric buses will be purchased, as well as elevators installed at more stations, and other modernizations made to the system.
Solender argued that additional funding was required to improve the attraction and attract repeat visitors.
The MTA did not anticipate such a sluggish recovery in transit ridership. Subway ridership during the weekdays is roughly 60% of what it will be in 2019. The MTA claims that farebox and toll revenue used to cover roughly half of its operating costs but now only pays for 30%.
The declining number of customers has put a strain on the transit system’s budget. The Metropolitan Transportation Authority (MTA) is hoping to secure additional state funding as early as next year in order to mitigate a projected $2.6 billion operating budget deficit in 2025.
The proposed congestion pricing in New York City could cost some drivers $120 per trip. published initially in Autoblog on August 21, 2022 at 7:00 a.m. EDT. If you wish to use feeds, please review our terms.
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