Cuomo, Christie Back Reduced Toll Increases for Hudson River Crossings
Governors Andrew Cuomo and Chris Christie offered to back a $4.50 toll increase for the bridges and tunnels operated by the Port Authority of New York and New Jersey after deeming a higher proposal “unacceptable.”
The port authority said its board, whose members are appointed by the two governors, will vote today on the plan that includes a $1.50 increase effective next month. The agency runs the George Washington Bridge and other spans between New York and New Jersey, the Holland and Lincoln tunnels, and airports including John F. Kennedy International.
The terms set by Christie of New Jersey and Cuomo of New York would pare toll increases to $4.50 over five years, from $6 over four years. In return, they said they would require an audit after New York’s comptroller criticized the Port Authority’s spending on overtime.
“An increase cannot be avoided,” the governors said in a letter to the board yesterday. The joint proposal “reduced the burden on drivers and businesses but still ensured that the authority’s finances would be stabilized.”
Christie, a 48-year-old Republican, and Cuomo, a 53-year- old Democrat, share oversight of the agency and can veto any increase. Each governor appoints six of its 12 commissioners. Josh Vlasto, a spokesman for Cuomo, didn’t respond to an e- mailed request for comment.
“I have a decent degree of confidence that the Port Authority commissioners would probably vote for it,” Christie said yesterday, referring to a revised toll plan, before the details were made public.
Call for Audit
The governors’ plan would raise peak-time tolls $1.50 for E-ZPass users in the first year, bringing the rush-hour fee to $9.50. Drivers paying cash would pay an additional $2.50, for a total of $12 for a two-axle vehicle. Hudson River crossings would rise 75 cents each December from 2012 to 2015, they said. The toll is collected only for travel into New York.
Commuters on PATH trains would see one-way fares rise to $2 in September from the current $1.75, followed by additional 25- cent increases annually for four years.
On Aug. 5, the Port Authority proposed boosting the cash toll for the George Washington Bridge, Lincoln and Holland tunnels, and three bridges connecting New Jersey to Staten Island, to $15 from $8. Drivers using E-ZPass would see peak- hour tolls into Manhattan go to $12 from $8.
The agency, which doesn’t receive tax revenue and relies mostly on tolls and transit fares, needs the money to fund a 10- year, $30 billion capital program and to help rebuild the World Trade Center, Executive Director Chris Ward said in an Aug. 15 statement.
‘Slow or Stop’
“Without this increase now, construction of the World Trade Center site could slow or stop,” said Ward, whose $7.2 billion budget for 2011 holds operating expenses flat and contains $3.9 billion in capital spending. The projects will generate 167,000 jobs and $9.7 billion in wages, he said.
More than half of U.S. public transit agencies surveyed in March said they may increase fares or trim service this year amid budget deficits and a threatened loss of federal funding, according to a report this week by the American Public Transportation Association.
In a joint statement following the release of the Port Authority’s proposal, Cuomo and Christie had said agency officials were concerned about a potential credit cut without toll increases.
‘Potentially Disastrous’
A downgrade may “pose a potentially disastrous result on a transportation network that millions of residents of the states of New Jersey and New York rely on and would be unacceptable,” they said.
An AA- rated Port Authority tax-exempt revenue bond issued in July 2010 and maturing July 2040 traded Aug. 18 with an average yield of 4.29 percent, about 42 basis points above an index of top-rated 30-year tax-exempt bonds. That compares to Jan. 19, when the bonds traded with an average yield of 5.92 percent, the high for 2011, which was 92 basis points above that day’s index of top-rated 30-year tax-exempt bonds. A basis point is 0.01 percentage point.
The AA- rating from Standard & Poor’s and Fitch Ratings, their third highest, is one level below Moody’s Investors Service’s grade of Aa2.
New York Comptroller Thomas DiNapoli released an audit of the agency this week showing it had paid $85.7 million in overtime last year to 5,360 of its 6,977 employees. Employees of the Port Authority Trans Hudson railway, or PATH, and public- safety workers made up the majority of those receiving overtime, according to the report.
“Overtime flows like water at the Port Authority and management has no clear strategy to achieve its own benchmarks and goals for curbing costs,” DiNapoli said in a statement.
The authority oversees the region’s airport system, marine terminals and ports, PATH commuter rail line, six tunnels and bridges between New York and New Jersey, the Port Authority Bus Terminal and the World Trade Center.
To contact the reporters on this story: Esme E. Deprez in New York at edeprez@bloomberg.net; Terrence Dopp in Nj Statehouse at tdopp@bloomberg.net
To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net
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