Eric Goldwyn is a research scholar at New York University’s Marron Institute and an affiliated faculty fellow at NYU Shanghai. His writing on cities has previously appeared in New York magazine and the New Yorker online.
It’s every wonk’s favorite traffic-relief prescription. But getting road fees right is really complicated.
This time it was going to be different.
Last August, Governor Andrew Cuomo of New York told the New York Times that “congestion pricing is an idea whose time has come” for New York City.
In January, New York City Council Speaker Corey Johnson announced that “we need congestion pricing, this year, this session.”
In March, Kathryn Wilde, president of the Partnership for New York City and member of Fix NYC, a group appointed by the governor to study congestion relief and transit financing in New York, wrote, “the most promising source of new revenues [to fund transit] are charges on private cars, trucks, buses and for-hire vehicles.”
Advocates believed they had finally found common ground with state and local politicians in support of charging drivers to enter Manhattan during peak hours, an idea first fleshed out in 2008 during the administration of Mayor Michael Bloomberg. Now it seems unlikely that 2018 will finally be the year of congestion pricing: Last week Assembly Democrats advanced a terrible plan that would only levy a surcharge on taxis and for-hire vehicles—hardly a congestion pricing plan or sound policy. And the clock is running out on the state budget process that will decide the fate of the plan put forth by Fix NYC in January.
But as New York’s transit crises and traffic jams continue to get worse, congestion pricing will undoubtedly remain an attractive concept that an adroit politician will eventually shepherd through Albany in some form. Unfortunately, that’s the problem. We need to talk about congestion pricing not as an abstract idea, but as a set of discrete and thoughtful plans.
In New York, Cuomo’s support of congestion pricing was lauded by advocates as a major step for the cause. In fact, by talking about congestion pricing without concrete terms or details, Cuomo has arguably done as much to undermine the policy as advance it.
For example, days before Fix NYC released its congestion pricing plan in January, the governor described the forthcoming proposal as an infinitely flexible policy with “literally an ongoing spectrum of options.” When Fix NYC was made public, Cuomo issued a statement of support with a vague concluding paragraph that undercut the plan and invoked outer-borough populism:
But, as a born and raised Queens boy, I have outer borough blood in my veins, and it is my priority that we keep costs down for hard working New Yorkers, and encourage use of mass transit. We must also find a way to reduce the costs for outer borough bridges in any plan ultimately passed.
Cuomo seems to hope that a politically painless solution to New York City’s transportation woes will just present itself. Yet it’s decades of politically painless solutions that have exacerbated congestion, degraded transit service, and allowed capital spending on transit infrastructure to reach a level of profligacy unmatched by any other city in the world. If congestion pricing is to become law in New York City and be viable as a congestion mitigator, it’s time to get specific.
At the heart of this debate sit two fundamental questions: What is congestion pricing, and why should we care about congestion? The abstract idea is simple. To impose a congestion charge, you must merely define a geography and charge motorists a price for access to it. In practice, congestion pricing comprises a multitude of options and choices that need to be considered carefully. The success or failure of any plan hinges on the careful calibration of fees, the technology used to collect fees, boundaries, exemptions, complementary policies, and adjustments to the policy as congestion levels increase.
The first dilemma any planner must grapple with is the fact that congestion is not inherently bad—in a sense, it’s what animates cities and attracts people to places like New York City in the first place. The “congestion” of people, jobs, and institutions is New York’s greatest asset. Automobile congestion, however, hinders positive forms of congestion. The more room we turn over to cars, the more they eat the city and introduce spatial barriers that are only surmounted by more automobiles and infrastructure dedicated to supporting them. If, however, we seek a balance between the different forms of congestion, we need to find ways to conserve space that can be traversed by walking, bicycles, and transit.
The congestion-pricing narrative has often verged on the ecstatic. The New York Times, for example, recently published an article that pitched congestion pricing as a policy prescription that would “unsnarl” Manhattan’s traffic. Pointing to Stockholm, Singapore, and London—three cities that have enacted congestion pricing, with varying degrees of success—the Times suggested that the main difficulty is a public relations issue more than anything else.
But by focusing on the PR challenges, the story largely ignored some key differences between each city’s congestion pricing scheme. While reports out of Stockholm are positive, travel speeds and congestion levels have moved in the wrong direction in Singapore and London over time. Singapore has even taken the step of adopting a more aggressive congestion mitigation strategy by prohibiting the number of allowable cars to increase until at least 2020.
There are currently only five congestion pricing schemes in the world that approximate what New York was trying to do, so it’s more important to consider the nuts-and-bolts of each program, rather than glossing over them and assuming congestion pricing is a well-defined and agreed-upon policy that one orders online and installs on a lazy Sunday afternoon.
The five main things to get right are the charge; the geographic boundaries, complementary policies (such as how to spend the revenues), exemptions to the fee, and ongoing adjustments needed to ensure traffic mitigation goals are met over the long run.
The hallmark of congestion pricing is the price. How that price is determined is more art than science when politics are introduced. Many economists who study congestion pricing argue that the optimal price should approximate the short-run marginal costs of driving—pollution, deterioration of the road, and congestion. They also argue that those costs change based on levels of congestion; the price should increase as the availability of road space decreases.
Keeping all of this straight requires a fee-collection technology that is able to compute real-time prices based on levels of congestion on a specific stretch of roadway. Move New York, a variable-price tolling plan that gained traction from elected officials and advocates starting in 2010, captures some of this dynamism by calling for different tolls on different bridges. Fix NYC proposed a blunter flat fee that mimics London’s Congestion Charge and Milan’s Area C policy. Singapore’s Electronic Road Pricing and Stockholm’s Congestion Tax, on the other hand, are more dynamic and charge different prices based on the type of vehicle, time of day, and geography.
As tedious as it is to determine the right fee to charge motorists, selecting the right boundaries are equally challenging. New York City looks easy: Manhattan is an island, so you draw a ring around it and call it a day. That’s the approach that Stockholm has taken, more or less, while London, Singapore, and Milan created a smaller congestion zone within the larger boundaries of each city. Fix NYC’s boundaries run from 60th Street to the southern tip of Manhattan, with an exemption for drivers who use the FDR Drive without ever entering Manhattan’s grid south of 60th. Taxis and for-hire vehicles would be subject to charges anywhere south of 96th Street.
While these boundaries have some logic, they cover less than 5 percent of New York’s 300+ square miles. Pricing trips into the core of Manhattan will impact motorists from New Jersey, Westchester, Connecticut, and Long Island, but a larger zone that extends beyond Manhattan would also provide immediate benefits to the majority of bus passengers in New York City who are stuck in traffic beyond 60th Street in Manhattan. The larger zone would also help absorb growing automobile congestion as population and job growth continue at a faster pace outside of central Manhattan.
Exemptions, by and large, are to be avoided. Several cities included exemptions for hybrid and electric cars, to encourage greener behavior. But the result of those good intentions in Stockholm, London, and Milan was a greater shift to exempted modes than anticipated, which reduced the congestion benefits of pricing. Stockholm initially provided an exemption for green vehicles, but as more motorists shifted to these vehicles and travel speeds reduced, decision-makers eliminated the exemption. London had a similar experience with its licensed-private-hire vehicle exemption. The number of these vehicles grew from just under 50,000 in 2009 to more than 87,000 by 2016. Much like what has happened in New York, this boom has been blamed for slowing down average travel speeds to pre-congestion pricing levels at just over 8 miles per hour.
What kinds of exemptions might New York end up with? Fix NYC only offered an exemption for the FDR Drive, but Governor Cuomo’s comments seem to indicate his willingness to entertain more exemptions for outer-borough and suburban travelers.
Finally, all recent attempts to implement congestion pricing in New York City have promised to dedicate new funds to support transit, which should be a no-brainer. The main caveat here is that the MTA might be the worst transit agency in the world when it comes to spending money judiciously on transit infrastructure.
No policy is perfect from the outset. The clear lesson from Stockholm, Milan, Singapore, and London is that adjustments over time are critical. Closing exemptions, redrawing boundaries, incorporating new technology, and intervening when congestion creeps back up are vital to success. Each city has achieved some of its goals, but some have been faster to act than others. Stockholm has done an excellent job with adjustments as traffic dynamics change. London, on the other hand, has struggled to amend its policy as travel speed gains have eroded.
And even if a city does everything right, it’s possible that congestion will increase. Singapore introduced pricing, made adjustments to it, and complemented it by increasing the price of parking, vehicle registration fees, and fuel taxes. Despite that, the city’s congestion has continued to grow. And that’s a reflection of something bigger than just traffic: This is a city that provides opportunities for those searching for jobs, housing, and amenities; as in New York, Singapore’s pile-up of people is the product of its success. This “congestion noodle,” to paraphrase architect and critic Michael Sorkin, is about finding a way to nurture the traffic that allows cities to thrive while moderating the traffic that saps them of their vitality.
Governor Cuomo is right that congestion pricing is a policy whose time has arrived. But as New York’s elected officials continue to cobble together politically painless and practically useless solutions, the fight over Fix NYC has galvanized advocates and decision-makers who remain committed to its implementation. Even if 2018 isn’t the year, congestion pricing has arrived, and that means it won’t go away.