The Cost of Cold Feet: No Cordon Toll Means Kissing Most Congestion Pricing Benefits Goodbye

Without a cordon toll, the time savings from reduced traffic congestion drops by at least 60 percent. The revenues available to improve transit drop by 60 percent or more as well.

Without a cordon toll to reduce personal motor vehicle trips into the Manhattan CBD, any traffic reduction plan from Governor Cuomo won't be worth much. Photo: Aaron Naparstek
Without a cordon toll to reduce personal motor vehicle trips into the Manhattan CBD, any traffic reduction plan from Governor Cuomo won't be worth much. Photo: Aaron Naparstek

Last week, the Cuomo administration took steps to impose a congestion fee on taxi and Uber trips, but not on cars and trucks driven into the Manhattan core. It’s a troubling sign that Governor Cuomo may only move forward with a portion of the recommendations from his Fix NYC panel. And that would be a huge mistake.

If Cuomo gives up on a full cordon toll and limits his approach to a surcharge on for-hire vehicles, New York will miss out on most of the benefits it stands to reap from congestion pricing.

The numbers are stark. Without a cordon toll, the time savings from reduced traffic congestion drops by at least 60 percent. The revenues available to improve transit drop by 60 percent or more as well, leading to a corresponding drop in straphanger time savings from more reliable trains.

You can generate these forecasts by running any Fix NYC scenario on my BTA spreadsheet, then zeroing out the tolls, leaving just surcharges on yellow cabs and Ubers within the Manhattan taxi zone. The result: Every benefit promised for congestion pricing — less gridlock, better transit, cleaner air, a happier and more productive workforce — shrinks by 60 to 75 percent.

This shouldn’t surprise anyone. Although robust surcharges on taxis, Ubers, Lyfts, and the like are vital to congestion pricing, the cordon toll is even more essential.

Pricing only for-hire trips would have perverse rebound effects, leading to even more personal car travel in the congested heart of the city. That’s because drivers who now leave their cars at home will exploit much of the space cleared out due to higher cab and Uber fares. Without a cordon toll to reduce 15-20 percent of car trips into the Manhattan CBD, we can kiss most of the time savings goodbye, not to mention the political support of players in the for-hire vehicle industry who will be left holding the bag.

Consider the Fix NYC scenario with a $11.52 fee to enter the Central Business District in effect for enough time to capture 71 percent of car trips that cross into the congestion zone, which also tacks $3-$5 onto the cost of for-hire trips that touch Manhattan up to 96th Street. I call this the “Higher-Range Plan,” and it promises 514,000 hours of travel time savings for drivers and transit riders each weekday, with $3.3 billion in total annual net benefits.

But take away the cordon toll, and these gains drop to 210,000 saved hours and less than $1.4 billion in net benefits. Other Fix NYC plan versions show even more severe decreases. Without the cordon toll, the benefits from a “Lower-Range Plan” shrink by more than 70 percent:

Removing cordon tolls cuts the benefits from Fix NYC by 60 percent or more _ 21 Feb 2018

These findings ought to dispel the enthusiasm for Uber-only charges from commentators like Felix Salmon, the finance blogger who profiled me and the BTA for Wired magazine in 2010. Writing again in Wired this week, Salmon states baldly that congestion pricing “won’t do much to fix gridlock in our cities — [whereas] a traffic tax on Uber and Lyft could get cars moving again.” Really? An uptick of 1.7 to 4.6 percent is “moving”?

Had Salmon reached out to me, I would have gladly shared my figures indicating that the improvement in CBD travel times from for-hire surcharges alone will be several times less than that from pairing the surcharges with a cordon toll. Moreover, the drop in speed gains outside the CBD is even more precipitous: From a 7 percent improvement on the streets approaching the Central Business District, to under 2 percent.

The reason isn’t hard to see. Uber and the other app-based ride services such as Lyft make up only 25 percent of vehicle mileage in the CBD, and even less during the daytime hours when traffic congestion peaks. For yellow cabs, the share of mileage is likewise 22 percent. Ubers and yellows both have flatter hourly “profiles” than private cars and trucks — meaning the peaks aren’t as high, and they don’t contribute as much to intensifying traffic during rush hours. Charging for-hire vehicles alone is like fighting with one hand tied behind your back.

To use a different metaphor, one that the governor’s late father, a one-time Pittsburgh Pirates prospect, might have appreciated: Our transportation crisis has the city down by three runs in the ninth inning. We’ve loaded the bases, thanks to fierce organizing by transit advocates and the table-setting policy recommendations in the Fix NYC report. Charging only for-hire vehicles is no better than a sac fly or groundout that brings in just one run.

What we need, of course, is a congestion pricing grand slam. Our leaders in Albany and City Hall need to deliver.

  • Larry Littlefield

    It isn’t about transportation. It’s about finding someone or something unpopular to squeeze money out of in the wake of Generation Greed’s debts.
    You might recall poor minorities and immigrants were demonized in the early 1990s, and social benefits for them were slashed. Where are all the savings now? Already spent.
    Then it was the big bad tobacco companies. Remember all that money the were forced to pay to make up for the damage they caused? Bonded against and spent.
    Casinos, that was the solution. Now the are everywhere, with the attendant social harm, but where are all the revenues? Some of them are applying for government subsidies to stay open, now that their customers are all bankrupt.
    How about all those fines to the banks, in the wake of the financial crisis, collected in lieu of any accountability for those who caused the problem? Spent.
    Now there is this idea that even without cordons, the politically unpopular (with some people, including the TWU and the medallion owners) Uber and Lyft might be squeezed for enough money. To kick the can for five years, if the money is bonded against for 30 years or more. And then in five years? Gone, and there we are again.

  • walks bikes drives

    I thought Cuomo had said all along (what’s it been, 4 or 5 days?) that his plan was phased, with the first phase being taxis and for-hires.

  • BortLicensePlatez

    i think its cute that people take that scumbag cuomo at his word…

  • John H Steinberg

    UNDERSTAND your cynicism but not applicable here. first, the revenues will be dedicated to transportation by law. second, even if the revenues were squandered, at least we’d all move 20% faster and breathe easier

  • motorock

    Yes, one cannot trust Cuomo or the MTA- they have the worst track record in trying to fix the subways and their word is as good as a pile of doo.
    The congestion pricing was going to be phased, yes. And this is a start but the c.p as it stands is not perfect. The BTA is faulty because it does not include all vehicles nor does it encourage alternative modes of transport- big fails.
    Another idea- rather than waiting on people to shift deliveries to less peak hours after cp, the law should tell them that they can only move during certain hours- maybe nighttime. The major traffic jams during peak hours often are caused by double parked delivery trucks- and cars trying to get around them. Car pools should be promoted and exempted, as should two-wheeled vehicles while stopping the stupid crackdown on e-bikes.
    The subway isn’t going to get fixed unless we completely restructure the MTA and its corrupt, inefficient ways. No plan and no person (including Komanoff) has pushed for this very essential thing for making sure that the money collected will be used optimally by the MTA- which they have NEVER done.
    We need to get people moving by all means possible rather than pushing them to this mess of a subway system. That is common sense that none of these c.p. plans seem to be following in their greed to collect revenue- they are forgetting the people and what is most important.

  • Vooch

    He isn’t cynical just knowledgable

  • El Deplorable

    Congestion pricing is a terrible idea, period. People look to London as some kind of shining example, but look at study after study: traffic in London is still a disgrace! Apart from padding the pockets of an already overbloated government, all congestion pricing did in London was make terrible traffic somewhat less terrible. And at a significant expense to residents. That is hardly worth it in my view.

    Now, what does work in London and in NYC are dedicated bus lanes. But congestion pricing should never be allowed to take hold in NYC.

  • El Deplorable

    He speaks the truth. Congestion pricing is a terrible idea, period. People look to London as some kind of shining example, but look at study after study: traffic in London is still a disgrace! Apart from padding the pockets of an already overbloated government, all congestion pricing did in London was make terrible traffic somewhat less terrible. And at a significant expense to residents. That is hardly worth it in my view.

    Now, what does work in London and in NYC are dedicated bus lanes. But congestion pricing should never be allowed to take hold in NYC.

    If you want more money for transportation, cut down on the generous pension benefits and other wasteful spending provided to the MTA workers, etc., and use those savings to build up the system. We can’t keep taxing and spending our way out of irresponsibility.

  • John H Steinberg

    Not so. Check out London Mayor Khan’s position. He talks about modifying the plan, not abandoning it. It was adopted i think 15 yrs ago, before bike lanes and e-summoned taxis. of course that would require adaptation.

    the expense you speak of runs to maybe 4 percent of vehicles entering the cordon plus folks taking taxis. the benefit to the other 90 percent is enormous. the market talks: some vehicles will always be deterred by the toll. it cannot not work.

    of course tailor excessive benefits and punch mta till it runs a respectable capital program. but doing that will not remove one vehicle from the streets.

    avoid one-shot thinking. this mess calls for the big picture, which means the cordon plus plus plus

  • mark

    Trolls abound… if you hover over the pictures of people commenting you can see thousands of comments… who has time for that. Trolls!

    Congestion pricing should be a no-brainer for NYC. The metrics should be congestion relief and money raised. Yes the tax haters will arise, but guess what: taxes pay for things we need and we need decent transit if we’re going to be a civilized society.

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