by Sarah Bedford, Investigative Reporter | July 18, 2023 | The Washington Examiner
New York City is set to become the first city to try taxing drivers off the road, but the results could cause more harm to the Big Apple than leaders anticipate.
The proposal is just the latest step forward in a green energy agenda that Democrats around the country have embraced, regardless of the economic impact.
NEW YORK CITY PUSHES THE LIMITS OF GREEN POLICIES
Authorized under then-Gov. Andrew Cuomo in 2019, New York’s congestion pricing plan will charge drivers a fee to enter the busiest parts of Manhattan. It was envisioned as an effort to nudge some drivers off the roads and onto public transit to fight climate change and raise revenue for the state.
But the situation in Manhattan, as in the rest of the country, has changed dramatically since state lawmakers conceived the congestion pricing plan.
“I think one of the consequences which was not considered when the law was enacted by then-Gov. Cuomo in 2019 was hindering the recovery from COVID,” Nicole Gelinas, a senior fellow at the Manhattan Institute, told the Washington Examiner.
Gelinas noted that while ridership on public transit has significant ground to cover before it reaches pre-pandemic levels, “car traffic has basically returned to normal.”
“Some number of people commuting to the office at least a couple days a week have switched from taking transit to taking cars; otherwise, the car traffic would not be back to normal,” she added. “So we have to think very carefully: Do we want to discourage that car travel into Manhattan?”
Car traffic has bounced back far faster than public transit since the 2020 lockdowns.
“While traffic on MTA [Metro Transit Authority]’s bridges and tunnels leading into the city are close to or higher than in 2019, transit usage continues to lag,” the city’s comptroller said in March.
The congestion pricing plan could hamper the city’s efforts to attract workers back to offices they left in 2020.
Leaders have signaled they may set the entry tax for Manhattan as high as $23 during rush hour and $17 during other parts of the day.
That means a commuter who drives to his or her Manhattan office could pay more than $100 per week simply to enter the area, in addition to the tolls he or she already pays to cross the highways and bridges leading into the city and the hefty prices already charged for parking in the area.
New York City has struggled to fill its office buildings after years of remote work, even more than other major cities have.
Office buildings in New York City remain roughly half-empty relative to pre-pandemic levels, according to Kastle data.
Houston, Austin, Chicago, Dallas, and Los Angeles all recently surpassed New York City in terms of office occupancy.
Retail shops have dried up in New York City as well. Manhattan was hit particularly hard, losing more private businesses than any other borough during the pandemic, the comptroller said last year.
Charging people a significant fee simply to access the area by car could further dampen interest in spending time in Manhattan.
The fee could also worsen a parking shortage in parts of the city just outside the bounds of the tax zone.
Parking garage owners inside the tax zone have expressed concern that business could dry up if fewer people bring their cars into the area due to the fee.
The city’s assessment of the plan acknowledged that “all tolling scenarios would result in a reduction in parking demand” inside the zone, with an increase in parking demand at already-crowded subway stations and park-and-ride stations elsewhere.
Just outside the proposed zone, which would begin at 60th Street, residents may find it difficult to park near their own homes if commuters attempt to drive as close to the line as possible and leave their cars outside it to avoid the tax.
But some people could avoid the area altogether if the price of entry makes visiting for pleasure economically unfeasible for tourists and families driving in from the suburbs.
“It’s not a congestion charge if you’re charging off-peak hours, even at times when there’s no congestion,” Gelinas said.
New York leaders argue the congestion pricing would help the environment and raise money to improve the transit system by discouraging some people from driving cars and collecting lucrative fees from those who aren’t dissuaded.
“We are going to be the very first state in the nation, the very first city in America, to have a congestion pricing plan,” Gov. Kathy Hochul (D-NY) said last month. “We are setting the standard right here in real time for how we can achieve cleaner air, safer streets, and better transit.”
Still, other critics say the congestion tax could worsen inequality in an area that is already becoming inaccessible to lower-income city residents.
“Another problem for Manhattan is that the borough is increasingly the province of the wealthy,” wrote Tyler Cowen, an economics professor at George Mason University. “Manhattan might do better to avoid complete gentrification and to keep some marks of its artistic and working-class backgrounds. But if expensive tolls mean that mainly wealthier visitors come, that will help the fancy jewelers and retailers and other high-price sellers, which in turn will nudge Manhattan more in a wealthy, gentrified direction.”
Even some Democrats are opposed to the plan.
Sen. Bob Menendez (D-NJ) introduced a bill in May that would fight the congestion pricing plan at the federal level, arguing the tax would hurt New Jersey residents disproportionately.
He noted that New Jersey commuters, under the plan, would ultimately pay $5,000 a year if they commute to Manhattan and pay the existing $17 in tolls to cross through tunnels to the city each day, in addition to the proposed $23 congestion tax they’d pay daily.
Still, proponents of the congestion tax say the $1 billion a year it could raise would fund improvements to the public transit system that would, in time, benefit more New Yorkers.
Opponents say the MTA would need to add significantly more capacity on the weekends and off-peak hours to accommodate what could be a substantial increase in ridership if enough Manhattan visitors decide they are unwilling to pay the entry tax.