Analysis | How the Port Authority Toll And Fare Hike Came to Be

The hike in tolls and fares on Hudson River crossings was the result of a delicate tango between the tax-averse governors of New York and New Jersey and the cash-strapped Port Authority, which passed the increase on Friday.

It will cost drivers $1.50 more to enter New York from New Jersey beginning next month and will increase 75 cents every year after that. The $1.75 PATH train fare will increase 25 cents a year for four years.

Tolls for EZ pass users will go up to $9.50 during peak hours, eventually rising to $13.  For the Hudson River crossings, there will be a $2 cash surcharge.

On one hand, the swift-moving Port Authority toll and fare hikes were a case study in how to push something through with as little input as possible: announce something on an Friday afternoon in August, hold an accelerated schedule of hearings, then vote in the morning while families are loading up their minivans with ice-coolers, fishing rods and other weekend items.

On the other hand, it’s a case study in how to get two tax-averse governors to raise revenue to pay for big infrastructure projects – especially after New Jersey Governor Chris Christie killed the biggest transit in the nation because he didn’t want taxpayers on the hook for cost overruns.

A Timeline

The Port Authority announced its plan – without notice – late in the afternoon two Fridays ago. In an usual joint statement, Christie and the New York Governor Andrew Cuomo  issued a carefully worded statement opposing the proposed hikes.

“The Port Authority has informed us of its proposal to dramatically increase tolls on its tunnels and bridges and fares on the PATH,” the statement read. “While we understand the Port Authority leadership’s concerns about a potential downgrade to its bond rating if toll increases are not instituted, our primary concern with this proposal is its impact on our respective states’ residents and commercial users of the crossings.”

The governors of both states control the Port Authority board. Through tolls, fees and real estate revenue, the Port Authority raises all its own money, but still does not act independently.

A week after the toll proposal was announced, Christie railed against the Port Authority leadership for mismanagement.  Cuomo called the toll proposal “a non-starter.” But still, neither ruled out hikes altogether.

As late as the Thursday before the vote, Christie was calling for Port Authority reform, railing about a the recent state comptroller’s report that showed the Port Authority paid out big bucks in overtime.

Later that same day, at 6:30 p.m., the letter crossed reporters’ email transoms: tolls would be going up.  The increase would not be the high rate of $15 for some users, but they would start with a $1.50 rise almost immediately.

“While we did not want to see any toll increase, given the crisis facing the Port Authority and its finances and the potential safety and economic risks to commuters and businesses, an increase cannot be avoided,” the governors wrote in their letter.

Justifying the Hike

The governors said not raising tolls and fares would “jeopardize 167,000 jobs and $9.7 billion in wages” —  the same argument given by the Port Authority’s board before its vote Friday.

“It is the impact of these factors: a slowed economy, the commitment to rebuild the World Trade Center site and other infrastructure investments and our responsibility to provide security for our travelers, our customers and our commuters,” Chairman David Sampson said before the vote.

He added: “Port Authority projects drive jobs and economic growth and that a failure to invest in infrastructure today will only cost us more in the long term.”

Christie’s critics made the same argument before he pulled the plug on the so-called ARC tunnel.

But unlike the ARC tunnel, the Port’s big projects, like rebuilding the World Trade Center, are not so easily stopped.  And with federal funding for infrastructure drying up, it may be that the governors have decided, of all the unpalatable options for paying for infrastructure, this one was the least bad.