The Case on Congestion Pricing

by Jonathan Judge, Brooklyn YRs

Former President Ronald Reagan once said, “Government's view of the economy could be summed up in a few short phrases: if it moves, tax it; if it keeps moving, regulate it; and if it stops moving, subsidize it.”

Congestion ‘pricing’ (or, more appropriately, a congestion ‘tax’), is a mechanism of imposing a per-use government surcharge for moving in a private vehicle on ordinary local public streets within a certain area.

And it may be coming to a city or town near you in the future if the State Legislature approves it for NYC on March 31st.

Why, you might ask, would our representatives vote for this. The goals articulated are many, but mainly as a government disincentive to modify your daily behavior to the way government thinks best. Some argue it is meant to reduce traffic congestion by pricing people out of their cars and on mass transit. Others argue it is the only way to reduce pollution by fining people for using private vehicles. And then many more honestly admit that it is just another means to raise revenue, particularly for already tax-payer funded transportation. Meanwhile, the revenue would not go to improve roads, but would be redistributed to mass transit improvements almost exclusively.

While congestion pricing does not exist in the United States yet, there have been certain areas with variable highway tolls, which is somewhat similar, though there is always a free alternative. Congestion pricing, however, by definition, eliminates any free alternate routes--it’s government’s way or no way.

New York City: The Test Subject

New York City Mayor Michael R. Bloomberg (Unaffiliated), prompted by a Federal grant opportunity, has introduced a congestion pricing plan. The NYC Traffic Congestion Mitigation Commission, created by the State last year, has recommended a plan to charge all incoming drivers south of Manhattan’s 60th Street $8 a day (or $2,000 a year) between 6 AM and 6 PM on weekdays. Trucks would be charged $21 a day, or about $5,000 a year. It must be adopted by the New York City Council and the State Legislature before anyone can be charged. Furthermore, it could stand as precedent for other cities and towns in the state to begin implementing similar taxes.

New York State Highest Taxed State

The facts are out: New York State is one of the top three states with the highest tax burden in the country, according to the Tax Foundation.

But the experts don’t need to tell us that it’s expensive to live in New York, never mind to raise a family. We know it firsthand.

Pundits are already trying to figure out about how much our congressional representation might be reduced after the 2010 Census because New York is not growing at the same rates as other states.

We as Republicans have seen the error of the ways of this State and, consequently, hold dear the following two principles, which are found in our State Creed:

“I believe that while government can and should be the provider of some essential services, it should function with limited taxation, financial efficiency and the adoption of innovations to allow taxpayers to get the most for their hard-earned tax dollars”; and

“I believe that our natural environment is a precious resource for all humankind, and that citizens and government should work together to implement common-sense policies that allow for both environmental protection and economic growth.”

Our Republican principles acknowledge this, and the facts surrounding us compel us to do something about it.

For instance, in recognition that making travel more expensive hurts economic growth upstate, many Republican State Legislators are aiming to fight the toll hikes on the New York State Thruway, and some local elected officials are even recommending the abolition of the tolls altogether.

The impact of a $2,000 a year tax to commute into Manhattan by car would be certainly devastating for the breadbasket of the Empire State, and the evidence shows that it would do little to advance any of the goals that it is designed to produce, except to make government more money.

Does New York City Need a Congestion Tax?

On the charge that congestion is bad now and will be getting hopelessly worse, here are the facts. The number of private vehicles in Manhattan has gone down by 20,000 over the past 20 years. Census data shows that more people each year leave their cars at home to take mass transit instead, which infuses more revenue into mass transit by the very fact of its increased demand.

Those neighborhoods where a relatively large number of people drive to Manhattan (a) have mass transit options at or exceeding capacity that cannot improve service without multi-billion dollar new subway lines, (b) are areas without any sort of local access to Manhattan-bound mass transit, (c) are located where driving is faster than any available mass transit alternatives, or (d) mass transit does not fit into the demands of the individual’s or family’s daily routine. Not surprisingly, then, the MTA, which supports congestion pricing as it would be the primary recipient of revenues collected, does not anticipate that more than 1% of these drivers will switch to mass transit.

On the charge that pollution from cars will only get worse, here are the facts.
The City of New York released last year an analysis of greenhouse gas emissions in the city. It showed that pollution from vehicles has gone down 6% from 1995 to 2005, thanks to tougher standards and fewer people driving. The State Department of Environmental Conservation revealed that enforcement of environmental standards has been significantly lax because 33% of diesel trucks surveyed entering upper Manhattan grossly violated State emissions standards. Enforce more, don’t tax more.

On the charge that more revenue is needed to improve mass transit, here are the facts. Most of the improvements, such as expanding ferry service, creating bike lanes, creating Bus Rapid Transit lines, building the Second Avenue Subway, and creating new regional commuter hubs, are already being fully funded or implementation has already begun--all without a new tax. Funding through efficient planning, Federal grants and other investments has been working quite well enough.

How Does It Work in London

London’s congestion tax scheme is similar to the one proposed in New York City. While it did out-price some people from driving into London, the level of traffic congestion in 2002 and 2006 was exactly the same--about 2.3 minutes of delay per kilometer. In the short life of the congestion tax in London, the fee has already doubled from £5 ($10) a day to £8 ($16) a day. The tax zone also doubled from 8 square miles to 15 square miles, meaning more potential drivers to tax. Now the Mayor of London wants to charge all SUVs £25 ($50) a day. Bus fares were still increased a couple of years into the tax by 10%. Furthermore, a recent poll shows three-fourths of Londoners are against the congestion tax altogether. Other local governments in the UK, because of London’s revenues, are trying to impose their own congestion taxes, but with extremely high public and business opposition due to the massive tax burden.

How Do New Yorkers Feel About It?

About two-thirds of New Yorkers have been consistently opposed to the plan since last year. They would only consider it slightly favorable if it were used to prevent mass transit fare hikes, but this is something the Traffic Congestion Mitigation Commission recommends against.

Republicans generally oppose it more than Democrats, though opposition from both sides is at or above 60%.

No wonder opposition is so high: commuters who drive into the City from the Five Boroughs have a median income of $41,000 a year. That represents the equivalent of a 172% increase in State income tax for someone earning $41,000!

The Past Becomes Our Future

In 1990, several City Council Members introduced a City Charter amendment to ban congestion pricing in New York City. It never went anywhere, and here we are.

The people of New York City and New York State would be wise to oppose this scheme and work towards better and more efficient means of improving transportation and the overall ability to live and work in our state rather than resort to the typical liberal solution: if there’s a problem, tax something.

Jonathan Judge is the Secretary of the Brooklyn Young Republican Club and the Editor-in-Chief of the GOPyr.