WEEKEND READ: Every Last Detail About Congestion Pricing … Explained!

Two experts answer every question ... and raise a lot more!

Photo: Google Maps
Photo: Google Maps
Authors Alex Matthiessen and Kate Slevin
Authors Alex Matthiessen and Kate Slevin

New York made history this week.

Governor Cuomo and the state Legislature included the nation’s first ever congestion pricing program in New York State’s FY2020 budget on April 1. The budget authorizes the MTA, in cooperation with the city, to establish a congestion pricing tolling system around Manhattan’s Central Business District.

The budget legislation creates a solid framework for the plan’s design and implementation while leaving some of the specifics to the MTA to work out, with input from a newly formed board, over the next 20 months. The budget also mandates a number of reforms to how the MTA is governed and managed.

Here is what has been established so far:

The Basics of the New CBD Tolling Program

  • The legislation is referred to as the “traffic mobility act” (TMA) and outlines “a program to establish tolls for vehicles entering or remaining in the most congested area of the state…”: Manhattan south of and including 60th Street.
    Passenger vehicles will only be tolled once per day.
  • The “operation” date shall be “no sooner than Dec 31, 2020,” which we read to mean it will start on January 1, 2021 as the MTA has every reason to want to get the revenue flowing as soon as possible.
  • The authority has said it has already initiated the process of issuing bonds against the new statutorily mandated revenue.
  • There must be at least a 30 day testing period and 60 day public information campaign prior to launching of the tolling program. In recent days, MTA Chair Pat Foye has committed to public hearings, similar to what the agency organizes for fare and toll hearings.
  • Installation of tolling infrastructure shall not be subject various state and city environmental or other laws.
  • The budget also includes a separate $100M for the MTA to plan, design, procure and install the new tolling technology and infrastructure.

The city’s Role

  • The bill requires the MTA and the City to enter into a Memorandum of Understanding (MOU) – within 60 days from bill signed (by ~May 31) –  that prescribes how they will work together to plan, design, install, and maintain the new tolling system (and signage), though ultimate authority and responsibility will rest with the MTA’s tolling agency, the Triborough Bridges & Tunnel Authority, or “TBTA.”
  • The Mayor also gets to appoint one member to the six-member “traffic mobility review board.”

The Traffic Mobility Review Board

  • Congestion pricing details, including rates and any further exemptions, are to be recommended by new six-person traffic mobility review board (“TMRB”) – one chair plus five members – with one representative each drawn from LIRR and MNR territory, and, as mentioned, one appointed by the Mayor. All but the Mayor’s appointee will be appointed by the TBTA (i.e., MTA/Governor). All shall serve without compensation. The recommendations are non-binding and must be delivered no sooner than November 15, 2020 and no later than December 31, 2020, or 30 days before tolling program to go into effect, whichever is later.
  • The TMRB has a broad mandate to recommend toll rates and variable (“time-of-day”) pricing structures, possible further exemptions (credits or discounts), though the latter must be informed by a traffic study. The TMRB is also authorized to consider further changes to the FHV surcharge system that went into effect in February, with consideration of a number of factors including initial market entry costs associated with licensing and regulation, comparative contribution to congestion in the central business district, and general industry impact.”
    • Specifically, the TMRB can consider “traffic  patterns, traffic mitigation measures, operating costs, public impact, public safety, hardships, vehicle type, discounts for motorcycles, peak and off-peak rates and environmental impacts, including but not limited to air quality and emissions trends.”
    • The TBTA and NYCDOT shall complete a traffic study on traffic inside and around the CBD to be used by the TMRB as it considers its pricing options.
    • New York City shall study the impact of tolling plan on parking within and around the CBD to be completed 18 months after the date the tolling program goes into effect.
    • The TMRB shall review the MTA capital plans – though the legislation doesn’t indicate what authority the TMRB will or will not have over MTA capital planning.

Financial Targets and the Lockbox

  • The TBTA is authorized to set variable tolls, so long as the annual revenue generated, minus operating expenses, is enough to bond against to raise a minimum of $15B in capital funding for the 2020-24 MTA capital program…and successor programs.
  • A central business district tolling capital lock-box fund will be created to protect all of the revenues identified in this section.
  • The budget includes additional MTA funding that will come from an internet sales tax ($5B) and a new “mansion tax” (i.e., an increase in the real estate transfer tax – also $5B).

Split among agencies

  • Funds will be distributed from the lockbox with an 80-10-10% split between NYCTransit, LIRR, and Metro North. The NYCT share shall be primarily invested in the subway system (new signaling, new subway cars, track and car repair, enhanced accessibility) as well as buses and bus  system improvements and expansion of service into outer borough areas with a history of limited transit options. Similar language, including with regard to expanding transit availability, applies to LIRR and MNR territories.

Current Exemptions

  • Any vehicle using FDR Drive or Route 9A (a.k.a. “West Street” and “West Side Highway,” including any roadway connecting 9A to the Hugh L. Carey Tunnel).
  • Emergency vehicles or vehicles transporting disabled person(s)
  • Residents of the CBD making less than $60,000 per year (adjusted gross income) are entitled to a tax credit equal to the amount paid for tolls (except if the toll is claimed as a business expense).
  • MTA Chairman Foye has said the MTA will figure out a way not to charge people who cross the 60th Street boundary in the act of moving their cars to comply with alternate side of the street parking rules.
  • Additional exemptions could be proffered by the Traffic Review Mobility Board whose recommendations are due between Nov. 15, 2020 and Dec. 31 2020. The TBTA will review and vote on the non-binding recommendations before it finalizes the tolling system.

Reporting

  • The budget mandates the MTA, with the assistance of NYC DOT, issue public performance reports a year after the tolling system goes into effect, and every two years thereafter. Financial reports on spending are due every year. Reports will address congestion changes (for FHVs and transit); vehicle miles traveled for FHVs; traffic volumes for all vehicle types; environmental/air quality improvements; congestion reduction measures; changes in transit ridership and bus speeds within the CBD; and all receipts and expenditures for the entire tolling program.

MTA Reform

The budget also addresses MTA reform, including 12 recommendations previously supported by Gov. Cuomo. The budget:

  • requires an MTA personnel and reorganization plan by June 13, 2019. The budget says this could include consolidation of departments or divisions. The MTA board will consider the plan and approve any changes within 90 days of the report’s issuance,
  • modifies the terms of MTA Board appointments to align with those who made the appointments
    requires the MTA to undergo an independent forensic audit and efficiency review by Jan 2020 and requires it to be posted publicly,
  • calls for a major construction review unit made up of outside experts to review major projects including signal system upgrades, communications based train control and ultra-wideband technology for use within the New York City subway system before they shall be implemented. The review of any project or system upgrade referred to the review unit shall be completed within thirty days from the submission of such project or system to the review unit.
    implements a 20-year capital needs assessment beginning in 2023,
  • increases the competitive procurement threshold from $100,000 to $1 million and establishes a 30-day review notice for NYS comptroller contract approval,
  • requires public reporting on MTA performance metrics,
  • requires any Capital Program Review Board member who does not approve of the MTA capital plan to issue a written explanation for his/her veto,
  • gives the MTA the opportunity to respond and revise the plan so the member may withdraw their veto,
  • allows the MTA to debar any contractor that exceeds ten percent of the contract cost or time on a capital construction project,
  • requires any MTA capital project over $25 million to use design-build, which should save the MTA time and money.

What’s Next?

With congestion pricing now on the books, the process outlined in the budget will unfold over the next 20 months. Here’s what we will be watching:

  • Appointments to Traffic Mobility Board: These appointments will be important to ensuring that the board puts forward thoughtful recommendations that advance the aims and fulfill the full promise of congestion pricing.
  • Exemptions: Representatives from every political district, trade group, industry, and special interest will be vying for their particular interest to be exempt from the new tolls. There are essentially two kinds of exemption: (a) those for drivers who cross another tolled facility on route to the CBD – e.g., the George Washington, Mario Cuomo (Tappan Zee), Henry Hudson bridges – and would thus face a “double toll” (despite drivers commonly pay a double toll when making any number of trips across the city region), and (b) different types or classes of driver who believe they are entitled to relief from the new tolls. A factor that should limit the number of exemptions is that the $15-billion minimum required militates against an excess of carve-outs because for every driver exempted there will be another driver who has to pay more as a consequence. Nonetheless, there will be enormous pressure on the TMRB, elected officials and the MTA to exempt everyone and their grandmother.
    • Lincoln/Holland/Midtown/Battery Tunnels: These crossings were not exempted from the new CBD toll in the budget language. It’s logical to credit tolls paid on existing facilities that lead directly into the CBD and such a toll credit was previously proposed.
    • West Street/9A exemption: An exemption for drivers using Route 9A made it into the final budget late in the process. This raises some complications, most notably, that the large number of entryways into the cordon could greatly increase implementation costs. Further, drivers could pile up on 9A trying to access garages west of the highway that would enable them to avoid the CBD tolls.
    • George Washington Bridge exemption: NJ and NY lawmakers are calling for an exemption to the George Washington Bridge. It’s conceivable there could be a noticeable increase in the number of vehicles traveling through the already congested Lincoln Tunnel to avoid paying a double toll to cross the GWB and then 60th Street to get to the CBD. On the BQE in Brooklyn, 25 percent of the traffic along the cantilever section is currently bypassing the Battery Tunnel, which has a toll, for a free bridge crossing further north. If New Jersey drivers were to similarly bypass the GW Bridge for the tunnels, Manhattan-bound buses and car drivers could see a significant increase in congestion in the Hudson River tunnels, as could the Hell’s Kitchen and SoHo neighborhoods.
    • Passenger vs. Commercial Vehicle Once Per Day Cap: The budget puts a once a day cap on passenger vehicles, not commercial vehicles. But small businesses in Queens and Brooklyn, in particular, have good reason to be unhappy with this omission. We advocates would prefer to see a once-per-day cap on commercial vehicles tolls than passenger tolls.
    • City/State coordination and control: The MTA/TBTA will be taking control over the entry points to the congestion zone, which has raised concerns among some city leaders who view it as an encroachment on their home rule powers. A possible mitigating factor is that the City will have the chance to negotiate the terms in the MTA/city MOU.
    • Capital program: The release of the 2020-2024 capital program will happen this fall (likely October), and will provide more detail about what projects congestion pricing revenue will pay for.

Alex Matthiessen is the president of Blue Marble Project, an environmental consulting firm based in New York City, as well as founder and director of Move NY, a campaign launched in 2010 to bring congestion pricing to New York City.

Kate Slevin is senior vice president of Regional Plan Association and has been advocating for congestion pricing since 2007. Previously, she was executive director at the Tri-State Transportation Campaign and Assistant Commissioner of Legislative and Community Affairs at NYC Department of Transportation.

  • Larry Littlefield

    “The TBTA is authorized to set variable tolls, so long as the annual revenue generated, minus operating expenses, is enough to bond against to raise a minimum of $15B in capital funding for the 2020-24 MTA capital program…and successor programs.”

    Unless they can say where the money will come from THERE WON’T BE ANY SUCCESSOR PROGRAMS. The most significant aspect of what they are doing is being treated by all and sundry as an “of course.”

    Remember that in 2025.

  • BikeGuyEmoji

    You are a crank.

    Anyway,
    No one expects any major expansion of the subway system unless it is paid for, and designed by the city. I’m concerned that the design-build rules will allow the State to design in more reduced-capacity upgrades.
    The City should budget its own transit war chest and plan to use it.

  • Not complaining here since this is such a tiny demographic but I am going to get screwed here as an occasional car renter living in the so-called CBD. Sometimes I’ll take a hourly carshare out of town to play golf or hike or whatever. These trips are essential to my well-being so I guess I’ll just have to find some more budget. But that’s the point, this is supposed to hurt. Shame on me for my dependence on cars.

  • Larry Littlefield

    This isn’t a major expansion. This is ongoing normal replacement. It isn’t capacity upgrades. It is keeping up (or not) with maintenance.

    “You are a crank” is not an explanation of how ongoing normal replacement will be paid for after 2025, when all these revenues are going to debt, along with the other revenues.

  • kevd

    It’s probably cheaper and not much slower to take the subway uptown and get a zipcar or whatever from there, right?
    Of course, with reduced congestion, driving out of the CBD will likely be faster.
    But, you get what you pay for!

  • Larry Littlefield

    Cheaper still to rent in Jersey City.

  • kevd

    even cheaper in new haven and some places in westchester – but those are normal rentals, not “car share” which is really just short term car rental.

  • vnm

    Even cheaper in Waterbury.

  • BikeGuyEmoji

    I agree that this will only cover ongoing maintenance. Because that is –barely– what the state wants. Transit should really be funded by general revenues of NYC.

  • Larry Littlefield

    Not sure there is golf in Waterbury.

  • vnm

    What parking garages west of the West Side Highway would be exempt from the cordon?

  • vnm
  • kevd

    Noted! Also very convenient to 84.
    can I walk to them from the Metro North?

  • vnm

    Not really possible to walk from Metro-North to the golf. BUT hopefully if there are zipcars there they are cheaper than in NYC?

  • Sassojr

    NJ Drivers are not your constituents. They should be paying towards congestion pricing. There should be NO exemption for any bridge or tunnel not operated by TBTA. If they don’t like the toll NYS has implemented, the discount should come from PANYNJ not the other way around. If any bridge should geta discount, it should be a bridge operated by TBTA. By exempting the Lincoln and Holland, you have guaranteed that any NJ driver taking the Lincoln or Holland has ZERO incentive to change their driving habits… But let’s charge my 300 lb motorcycle coming from the Bronx… This makes sense…

    It’s ok, no one can be directly held responsible for this since all the decisions are coming from an unelected board, who are barred from announcing the plan until after the 2020 elections.

  • kevd

    pier 40 is west of west street.

  • kevd

    i was looking for facts, not speculation, bub.

    Also the waterbury line is too infrequent and doesn’t fit with my last minute planning lifestyle.

  • kevd

    “exempting the Lincoln and Holland, you have guaranteed that any NJ driver taking the Lincoln or Holland has ZERO incentive to change their driving habits…”

    100% True.
    At least compel the PANYPJ to make those tolls 2 way before offering a discount carte blanche.

  • vnm

    Is there any reason to think it would be exempt fro the cordon though? If the legislation specified Manhattan south of 60th Street but exempted Route 9A, that’s fine, but it didn’t exempt Route 9A & everything west of Route 9A. So I’d say Pier 40 is in the zone.

  • Joe R.

    The problem of course is the idiotic idea of bonding against congestion pricing revenues instead of using them as they come in. That makes every new source of revenue essentially a one-shot deal. Once the money is spent, the new taxes are being wasted making rich bond holders even richer, not on MTA projects.

    The authority has said it has already initiated the process of issuing bonds against the new statutorily mandated revenue.

    They must really have a hard-on for this idea to start going ahead with the bonding process before the tax revenue even comes in. They must not want any public discussion on whether or not there should be bonding against the new revenue source.

    Seriously, has anyone in power come out against bonding? I would think anyone with a shred of common sense would.

  • Joe R.

    The problem is the way they’re doing this it’s not even going to cover ongoing maintenance in the long-term. It’s a one-shot cash infusion of $15 billion and that’s it. If they used the revenue as it came in, instead of bonding against it, they could get $1 billion annually forever. If that’s not enough for ongoing maintenance then you add new revenue sources BUT you use them as they come in, not bond against them.

  • The more I read about the exemptions, the more holes I saw. Let’s rejoice now, but watch what happens in 2021. I think some caution is warranted.

  • I don’t think it’s “supposed to hurt.” It’s simply paying for something that should never have been unpriced in the first place. And your bill will go to fix public transit. Cheer up!

  • kevd

    I think people assume it is. But putting a toll cordon sensor at the pier 40 entrance is not a big deal when you’re adding like, 80 between Battery park and west 60th street to keep west street out of the zone.

    London must have a 100 or more points of entry. they seem to manage.

  • Steven Craig

    This is a total mess. A tax on all New Yorkers and a gift to special interests and bureaucrats.
    Is it any wonder it has been reported that UBER spent over $2 million to pass this atrocity.

  • Steven Craig

    Transit is a service, not a right. Unfortunately there ARE massive and wasted subsidies most notably to the new Ferry System that make little sense except to the contractors and politicians who profit, very much like this “Congestion system “. Do away with ALL special fares and provide a universal low subsidy where needed. Those who now ( Over 20 % ) refuse to pay should be held accountable, perhaps sentenced to clean the stations. If you really cant afford the fare , see an NGO or Social Services, that is what THEY are there for. Not the Transit System.

  • Rider

    Will Battery Park City be excluded from the cordon? What about all the attractions on the west side of the West Side Highway that involve crossing the Hudson River path?

  • vnm

    Agreed. It isn’t a big deal at all. If Battery Park City is in the zone, which I assume it is, Pier 40 should be as well.

  • mfs

    the biggest problem w 9A/FDR exemption isn’t the garages, it’s that it will

    A) incentivize use of the Bk Bridge (passenger vehicles) and the Bk Battery Tunnel (freight) to get to NJ in an incentive that wouldn’t otherwise be there
    B) start to also lead to some odd exemptions for traffic from 9A to outbound Hudson tunnels on local streets

  • > . . . for vehicles remaining in the cbd . . .

    What if you live in the CBD and keep a car in a garage? Do you get tolled every day?

  • ohnonononono

    Note that it’s significant that the budget language states “entering or remaining.” It seems unresolved whether trips wholly within the zone will be free, but people seem to be assuming one or the other without much thought to this. For instance, in the write-up right here you state that the West Street/9A exemption “raises some complications, most notably, that the large number of entryways into the cordon could greatly increase implementation costs” but if we’re going to be charging for trips within the zone, the increased number of entryways on one street are going to be insignificant compared to all the equipment that will need to be mounted all over the inside of the zone. The state budget director has gone on record defending the idea of charging inter-zone trips, but it seems that a lot of people are assuming that won’t happen or maybe just forgetting about the whole concept of someone traveling entirely within the zone.

  • ohnonononono

    This language is meant to refer to a trip that takes places wholly within the zone, not literally just a daily charge for keeping a car in the zone, although that would be interesting…

  • reasonableexplanation

    But NJ drivers are already tolled…
    They’ve been effectively paying a congestion charge all along. The fact that the city is making some free crossings on the brooklyn and queens side match what NJ has been paying all along, shouldn’t mean that they should be paying more all of a sudden.

  • AMH

    Are there any targets in this legislation other than financial? I would like to see some air quality targets, traffic reduction targets, etc.

  • Sassojr

    So they should enjoy all the benefits of congestion pricing with none of the cost… Cool beans. NJ drivers are tolled by PANYNJ, if they have a problem, they should complain to them.

  • reasonableexplanation

    Why this obsession with which agency collects the money?

    From the drivers perspective a toll’s a toll, whether a ny/nj interstate agency or a nyc agency collects it. Let the government agencies figure that out.

    Why toll them twice? It doesn’t make sense. Making the toll equal no matter which direction you come through makes sense.

  • Sassojr

    Neither does a Congestion Toll that doesn’t fix either BS target it claims to fix.

    If the goal is changing drivers mindsets and pushing them towards more efficient modes of transportation, then why does that only affect NYers?

    If the goal is massive revenue, why are we leaving out this key demographic who don’t vote, don’t pay taxes, don’t pay any of the innumerable registration add on’s that local residents pay (NYS MOT registration fee is $17 yet in NYC it balloons to $45), etc.

    “Why this obsession with which agency collects the money?”

    A Queens resident can take the Midtown tunnel and have their toll discounted, but can’t take the Triboro when both are MTA bridges (money into MTA coffers). Yet if you drive through the Lincoln (PANYNJ), you get a discount and the MTA gets nothing.

  • reasonableexplanation

    So if your goal is to change existing driver’s mindsets at all costs, it would be logical to not offer a credit for the currently tolled midtown and battery tunnels either.

    But then you did nothing to change toll shopping, which was one of the goals of congestion pricing!

    NJ residents who work in NY (presumably who you’re targeting) do pay NY state income taxes, actually! They get a credit on their NJ taxes for it, but NY gets that money.

    Same way the Queens driver doesn’t get a discount on the triboro, the NJ driver doesn’t get a discount on the GWB, because they don’t spit you out into the congestion zone.

  • Sassojr

    Eliminate the discount entirely, you crowd the free crossings (possibly more than they are now). Discount only the east river crossings that lead into the CBD, you crowd all the CBD crossings plus all the free ones. Discount all the east river crossings, and people will take the most efficient route into the CBD (reducing congestion).

    As a Bronx motorcyclist, the current system would work in my favor (besides the lack of motorcycle exemption as every model city has done). It would take people off the Triboro and GWB, putting them onto the QMT, Lincoln, and Holland… But it’s definitely not the best system for the city as a whole.

  • Sanjeev Ramchandra

    Charging a flat, $3 toll in each direction of the four East River bridges generates $500 million a year, since 450,000 daily crossings occur on these bridges. There would be no need for exemptions since the $3 amount is affordable. The gantries would be placed at the base of each bridge on the Manhattan side. This technically avoids charging a direct toll on the bridges; the bridges can continue receiving taxpayer dollars for maintenance.

ALSO ON STREETSBLOG

GCA Backed Congestion Pricing — Why Not Bridge Toll Reform?

|
The General Contractors Association of New York, which represents heavy construction contractors, says it wants a funding solution to the $14 billion gap in the MTA’s capital plan — just not the Move NY toll reform plan that’s being shopped around Albany. It’s a shift in tone from the group’s interest when the plan was being developed a few years […]

Advocates Continue Pricing Push

|
With all eyes on the governor’s Fifth Avenue apartment, congestion pricing supporters are nevertheless soldiering on. The Empire State Transportation Alliance is one of several groups in Albany today, trying to get lawmakers’ attention despite what has been described as a "surreal" atmosphere. [Insert "Yeah, and?" joke here.] From an ESTA media release: Principals underscored […]

MTA Says it Needs More Money for Congestion Pricing

|
The deal that produced the 17-member Congestion Mitigation Commission mandated the MTA to "submit comments on the Mayor’s [congestion pricing] plan" by October 1, 2007. In these comments, the MTA was instructed to provide the Commission with three items: (a) a description of the additional capital needs required for implementation; (b) proposed utilization of any […]