ALBANY, N.Y. — New York legislators on Sunday passed a state budget for 2020 which will dramatically change traveling within New York City, introducing “congestion pricing” fees for drivers in Central or Lower Manhattan to fund improvements by the Metropolitan Transportation Authority.
The budget of more than $175 billion also includes new taxes on sales of residences for $1 million and up, as well as on internet purchases. The fees and taxes are expected to help contribute $15 billion to help transportation in New York.
Along with the new revenues, the new budget requires the MTA to develop a reorganization plan by June. Additionally, MTA Board appointments will need to align with gubernatorial terms and the MTA will see an independent forensic audit and efficiency review. Creation of a major construction review unit will review major projects as well. [See “New York MTA proposal would reorganize agency, provide funding through congestion pricing,” Trains News Wire, March 1, 2019.] The money will help fund New York City Transit’s previously-announced Fast Forward plan, which promises upgraded CBTC signal systems, new accessible stations, and repair work at more than 150 stations.
The concept of congestion pricing was originally suggested by New York Mayor John V. Lindsay and approved by New York Gov. Nelson Rockefeller in 1973. The plan was to bring pre-catalytic converter New York City into compliance with the federal Clean Air Act by placing tolls on the East and Harlem River bridges. That would have reduced motor vehicle traffic and raised money for the MTA. Rampant opposition from trucking and taxi companies killed the proposal, although the MTA then received $40 billion in investments to keep the subways running.
The concept of market-based congestion pricing on surface vehicles will be a first for the United States, although it has been used in Singapore since 1975, and in other cities as well, including London and Milan. New York’s electronic version would be run by the Triborough Bridge and Tunnel Authority, the division of the MTA that oversees seven bridges and two tunnels in New York. All revenue would go to the MTA, with funds slated strictly for capital improvements. Fewer vehicles on New York City streets would speed Manhattan traffic, much of which proceeds at a pace barely surpassing a fast walk.
The new fees will not take effect until 2021. A committee will determine full details of the congestion pricing plan, including potential exemptions for low-income individuals, those with disabilities, or other groups. At least one state legislator wants to exempt all New York City residents, but widespread exemptions would likely boost the toll cost for others or reduce the funds raised for the MTA.
The “mansion tax” will be assessed beginning July 1. It calls for one-time tax beginning at 1 percent for homes costing $1 million and caps at 4.15 percent on residences of $25 million and above. Revenues collected would be combined with congestion pricing revenue. No start date has been set for the internet sales tax, which will contribute more funds to the MTA.
