New York

Will Cuomo Use Monopoly Money to Eliminate NYC’s Toll Booths?

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Using his signature Make New York Great Again rhetoric, Governor Andrew Cuomo revealed yesterday that he will upgrade all MTA bridges and tunnels with cashless tolling and bejeweled lighting displays. How will he pay for it?

At the tail end of yesterday’s event, an audience member asked the governor where the funding is coming from. “We have the money,” Cuomo said before smiling at Tom Prendergast, the MTA’s chairman and chief executive officer. “If Tom Prendergast disappears, we have a problem, because he’s got the $27 billion.”

The governor was referring to the MTA’s $27 billion capital program, a list of upgrades spread over five years that received final approval from a state review board in May and includes nearly $2.9 billion for bridges and tunnels. “The funding is secured,” the governor said earlier in his presentation. “Tom Prendergast has it in his back pocket, I know he does.”

But how much more can be squeezed from the MTA’s bridge and tunnel capital budget? It has already been reduced by $200 million since September 2014, as the MTA revised cost estimates downward, stretched out project timelines, and employed other “efficiencies.”

It appears getting that money out of Prendergast’s back pocket and into the governor’s pet project will require a financial magic trick.

Much of the governor’s announcement yesterday gave details about things that were already approved in the $2.9 billion plan, like seismic upgrades, storm retrofits, and continued conversion of streetlights to LEDs. In other words, harmless horn-tooting. But a lot of it was new, particularly the decorative light shows, paid for the New York Power Authority, and the more substantive $500 million decision to shift the MTA from toll booths to a cashless system by the end of next year.

The MTA had been moving very slowly to modernize its toll system. Even though the Henry Hudson Bridge had been a proving ground for cashless tolls since 2012, the MTA still launched a $250 million project last year to rebuild old-fashioned toll booths on the Robert F. Kennedy Bridge, while making sure they could “accommodate any future change to all-electronic tolling.”

Of the nearly $2.9 billion set aside for bridges and tunnels in the capital program, only $206 million is for toll plazas and “intelligent transportation systems,” well short of the new project’s $500 million price tag. The capital plan doesn’t mention expanding cashless tolls; instead, it includes $82 million to finish the job on the Henry Hudson Bridge and $89 million to maintain state of good repair at the existing toll plazas.

The bridges and tunnels capital budget would accommodate the $500 million toll overhaul, said MTA spokesperson Beth DeFalco, through “efficiencies generated from other projects, including reductions from toll plaza work that did not assume open road tolling as the means of toll collection.”

Observers question how the MTA will force this new gubernatorial initiative onto its balance sheet. Since it was created in 1968, the MTA has used bridge and tunnel toll revenue to subsidize transit operations. Theoretically, the MTA could take some of this money to pay for the new cashless toll system. “It could be a hit on the mass transit side,” said Citizens Budget Commission research director Charles Brecher, “so New York City Transit has to figure out a way to make up for that loss.”

Naturally, transit advocates are not thrilled about that idea. “We’re glad the governor is turning his attention to the MTA’s infrastructure,” Riders Alliance deputy director Nick Sifuentes said in a statement about cashless tolling. “But we can only support these kinds of nonessential projects if we know that the core investments in maintaining and expanding our subways and buses are moving forward and are fully funded.”

There’s also the question of the money Cuomo already owes to the MTA. Of the $8.3 billion the governor said the state would kick in to the MTA’s $27 billion capital program, only $1 billion has materialized. This year, the governor did not provide any money, and future commitments are only available as a last resort, according to the state budget.

Cashless tolling isn’t the only Cuomo transportation priority with cloudy financing: the governor has been similarly vague about how the state will pay for Moynihan Station upgrade announced last week, and the Tappan Zee Bridge replacement.

In this case, a quirk of the MTA’s capital budget process might help Cuomo escape public scrutiny. Although most of the MTA’s capital plan is subject to approval by the Capital Program Review Board, which rejected previous plans over a lack of funding, projects within the bridge and tunnel budget do not require the CPRB’s stamp of approval.

The potential for financial sleight of hand worries watchdogs, who see it as a symptom of the governor’s last-minute decision to bigfoot the MTA’s capital program. “Somebody outside the process is saying, ‘Hey, I like this idea. Let’s add this to the capital plan,’ ” Brecher said. “It’s not consistent with the way you want to do longer-run capital investment planning.”