NYC Traffic Congestion Fees Become Political Quagmire

The federal government has removed approvals for New York City’s recently enacted program to use automated congestion tolls to help source an estimated $15 billion for the Metropolitan Transportation Authority. However, the corporation has said it will not comply and is being backed by state officials in a new lawsuit.

Earlier this week, the Department of Transportation (DOT) suspended support of the Manhattan Transit Authority’s (MTA) congestion pricing toll program. We’ve covered the plan in the past, often critically. But the gist is that New York City implemented an automated camera enforcement system (which reads license plates) to create new fees for drivers attempting to drive into lower Manhattan. It’s similar to what we’ve seen from several European cities and was rationalized by suggesting that the move would raise money for the MTA while limiting both traffic and the associated pollution.

While only active since January 5th of this year, the city has claimed that traffic declined by over one million vehicles within the first month. Local opinions on the issue have been mixed. But the leadership from surrounding cities, particularly those in New Jersey, have broadly come out against the scheme on the grounds that it will increase delivery rates, discourage business ventures, and disadvantage commuters who already pay bridge and tunnel tolls to get into NYC.

Additional criticisms have been leveled against the MTA for failing to improve subway and bus services in recent years. However, congestion pricing benefits the MTA more than anyone. Advocates believe that this will be an important cash injection needed to help turn things around, whereas critics are skeptical that the resulting revenue will be put to good use.

The federal government has landed on the side of the skeptics since Donald Trump took office and U.S. Transportation Secretary Sean P. Duffy announced that it would be rescinding its approval of the program on Wednesday. Duffy called the program a “slap in the face to working class Americans and small business owners” and has demanded that New York end the tolls as soon as possible.

Initially it looked as though New York was going to comply. Several media outlets even proclaimed that congestion pricing was effectively over at the behest of federal authorities. Donald Trump did likewise. However, NY Governor Kathy Hochul quickly held a conference in Grand Central Terminal to announce there would be a legal battle instead.

"Within seconds of us getting this notification, our MTA was prepared, we filed a lawsuit within minutes," Hochul explained. "[We are] very confident we'll be successful and I also want to say the cameras are staying on. We are keeping the cameras on."

The notification in question was a letter issued to Hochul from Duffy explaining that Donald Trump expressed concerns about the “extent of the tolling” and that the DOT’s Federal Highway Administration would terminate the approval of the program. This was followed by a press release from the Department of Transportation itself, stating that it had formally rescinded an agreement signed under the Value Pricing Pilot Program last November. It asserted that this measure effectively ended NYC's authority to even impose the traffic toll.

"As detailed in the letter, the Secretary is terminating the pilot for two reasons," explained the DOT in its press release. "First, the scope of the CBDTP is unprecedented and provides no toll-free option for many drivers who want or need to travel by vehicle in this major urbanized area. Second, the toll rate was set primarily to raise revenue for transit, rather than at an amount needed to reduce congestion. By doing so, the pilot runs contrary to the purpose of the VPPP, which is to impose tolls for congestion reduction — not transit revenue generation."

As a former resident of New York City, one thing that has always rubbed your author the wrong way about the MTA is that it’s technically an independent corporation that is run by a board of directors. Publicly owned, it receives income via investments in addition to fares and tolls. But it also is heavily subsidized by the government via grants and numerous taxes — including those pertaining to vehicle ownership.

Despite this, it is still billions of dollars in debt and has struggled to improve bus and train services in regard to both safety and efficiency. However, it’s also trying to rehabilitate an infrastructure that is over 100 years old in some places and it would be a lie to suggest NYC doesn’t have a surplus of traffic in the outlined congestion zone.

Hochul has made accusations that the federal government is overstepping its bounds and acting in a dictatorial manner. "I don't care if you love congestion pricing or hate it, this is an attack on our sovereign identity, our independence, from Washington," she said before suggesting drivers should blame Trump the next time they’re in a traffic jam.

Meanwhile, similar accusations are being thrown her way for the city instituting the congestion enforcement cameras without much public support. The cameras were extremely contentious and have been for years, so much so that Gov. Hochul actually stalled their implementation ahead of the most recent election. Protestors have likewise some out both for and against the cameras being installed.

The MTA has attempted to make the case that the cameras are working. "Traffic was down 9 [percent] in January, with 1.2 million fewer vehicles entering the central business district," stated MTA Chair Janno Lieber. "Bus speeds are up, crashes are down, and pedestrian traffic in business areas has surged. This is working."

Trump has argued the opposite in the past by suggesting that fewer people will come into the city for pleasure or trade due to the added tolls. It seems to be his belief that the scheme advantages the MTA financially while harming local businesses and commuters.

As of now, the MTA has stated it refuses to shut the cameras down until ordered to do so by a judge, with chairman Lieber saying tolls will remain in effect while the lawsuit plays out. This tactic could delay a decision for years and was highly effective in blocking policy changes (e.g. the fuel rollback) attempted by the original Trump administration. But the Trump team likewise seems to have been prepared for this contingency and has suggested NYC could simply be cut off from federal assistance if it’s not interested in complying. Our guess is that this is going to devolve into another politically motivated legal quagmire held at the taxpayers’ expense. It’ll likewise end one of two ways, each of which will be appeasing one group while angering another.

[Images: Here Now/Shutterstock.com]

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