Monday, April 15, 2013

NYC’s Failed Congestion Fee

Beginning in 2007, NYC Mayor Michael Bloomberg tried - and failed - to implement the first traffic congestion fee program in the United States. Modeled after successful programs in London, Singapore, and Stockholm, the plan would have charged an entrance fee to any private vehicle entering downtown Manhattan and revenue from the program would be directed toward the region’s mass transit system. By looking back at the program’s eventual defeat, we can see the complex interaction of local, state, and national politics.

NYC Traffic Data Viewer
NYC Traffic Data Viewer, displaying average daily traffic volumes.  It's hard to see, but interactive!  Click to explore.

NYC Congestion: Problems and Solutions

Road congestion is severe in NYC.  The 2012 TTI Urban Mobility Report ranks the New York metro area as the 4th most congested very large city, with the average auto commuter encountering 59 hours of delay each year.  The NYC congestion fee was an attempt to address this problem by charging a daily fee (minus any bridge tolls already paid) for any private auto entering the downtown Manhattan area between 6 am and 6 pm.  Because the fee area included state-owned roads and the program used state funds, approval from the New York State legislature in Albany was required for implementation.

Part of the funding for the project was to come from the USDOT’s Urban Partnership competitive grant program.  NYC was selected as one of the finalists, and offered $354 million in funding including $10 million for the congestion fee program.

Support, and Opposition

The plan received the support of diverse stakeholders including the Governor and many elected officials.  New York City residents generally supported the proposal, with some surveys finding over 60% support (depending on how it's explained).  However, the plan also met significant opposition, especially from the outer boroughs. The Bronx, particularly, relies on routes through Manhattan to reach the mainland. Other reasons for opposition included concern that neighborhoods on the outside edge of the fee zone would become a “parking lot” for drivers looking to avoid the fee, and concerns that the plan was a regressive burden on low and middle-income families.

Death by Inaction

Though the New York City Council approved the plan, it was never brought to a vote in Albany because of perceived opposition. Because the federal funding package was contingent on the plan receiving approval from Albany before a deadline of April 2008, the money was redirected to other congestion reduction projects in LA and Chicago.

What do you think?  

Should the congestion fee plan have been brought to a state-wide vote?  Are congestion fees a good way to reduce congestion, or is there a better alternative?  Were the concerns of the opposition valid, and could they have been avoided?

Thanks to Brett Lezon for providing editorial services to this post. 

Additional Resources

An in-depth review of how Stockholm residents voted to make a trial congestion pricing plan permanent (link prompts pdx log in):
Hårsman, B. and Quigley, J. M. (2010), Political and public acceptability of congestion pricing: Ideology and self-interest. J. Pol. Anal. Manage., 29: 854–874. doi: 10.1002/pam.20529

The NYCDOT retrospective review of the congestion pricing experience and implications:
Schaller, B (2010). New York City’s Congestion Pricing Experience and the Implication for Road Pricing Acceptance in the United States. Transport Policy 17 (2010) 266-273


  1. This is an interesting topic! Currently I am working on Singapore road pricing and it has worked there. And its been working since late 70's. I am actually surprised to see that 60% people were in favor of congestion fee. Nobody likes taxing, however your tax anxiety is somewhat alleviated if your tax money well spent, in this case easing out the congestion. You mentioned that proposal was that congestion fees would be applied for private vehicles entering the downtown Manhattan area between 6 am and 6 pm, I am curious if this area is congested through out the day. If not then congestion fees could be applied only during peak hours or when ever there is congestion. Singapore uses Electronic road pricing, its an automated system, where if the vehicle speed drops below the optimal speed ranges, driver is charged accordingly.
    I would also like to add that along with these options it is extremely important to run an efficient, safe and faster public transport system, or it will create even more negative sentiments against any change to improve the current congestion problems.

    1. Ben, I think you make some really interesting points. Politics play such a critical role for transportation initiatives that it’s hard to imagine congestion pricing ever realizing implementation in more than a few U.S. cities.

      After reading your blog post I read a few articles about London’s congestion pricing. I found this quote from former London Mayor Ken Livingstone to be of interest, “He said: "If it wasn't for the Republicans, who control the New York State Assembly, Manhattan island would have one. Mayor Bloomberg really wants to do it but he can't get the votes.” Whether the vote to approve congestion pricing had been sent to Albany or not it sounds as if approval wouldn’t have happened.

      Does it work:
      One question that came to mind was whether or not congestion pricing actually achieves the goal of decreasing congestion. According to a 2010 report from Congestion Charge London, the average reductions in auto trips inside the “zone” were reduced by roughly 15% to pre-charge levels. In the first year that number was closer to 30%. By 2006 reports show that congestion had dropped by 26% to the pre-charge era.

      The environmental impacts of congestion pricing also merit discussion. In 2003 Transport for London recorded falling particulate levels within the congestion charge area of roughly 13.4%

      Lastly, estimates show that the effect of congestion pricing on business has been negative. Many shops within the congestion zone report a decline of foot traffic varying between 7- 11% depending on the month. It has been estimated that due to the West London extension of the congestion pricing zone in February 2007, 6000 people will eventually lose their jobs.

      Despite the regressive nature of congestion pricing and the negative impact on business it seems that this is one technique that cities should consider to help reduce single occupancy trips in and around central business districts. Funding generated from the congestion charge (1 billion pounds in the first decade of London’s charge) could be used for general infrastructure maintenance and investments in public transportation networks. As politically challenging as congestion pricing is, I doubt we will see many cities implementing this strategy in the near future.



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