(Bloomberg) -- New York City’s regional economy may gain as much as $1.3 billion annually as a new toll to drive along Manhattan’s busiest streets eases traffic gridlock and benefits business activity, according to a civic group focused on economic health.
The first-of-its-kind congestion pricing program began on Jan. 5, with most motorists paying $9 during peak periods to drive south of 60th street in Manhattan. The aim is to ease congestion in one of the most traffic-clogged urban areas in the world and raise $15 billion over time to modernize the city’s aging transit network.
Workers heading into Manhattan’s tolled zone are saving an average three to eight minutes of travel time, according to a report released Tuesday by the Regional Plan Association, which promotes ways to improve the area’s economy and quality of life. New Jerseyans driving or commuting by bus to work are gaining the most time, saving as much as 21 minutes on a daily round trip. Commuters from Queens and Long Island are saving as much as 13 minutes.
“There’s an economic benefit for reducing those trip times,” Kate Slevin, the RPA’s executive vice president, said in an interview. “For every minute you’re sitting in traffic, it’s a drag not only on your time but the broader economy as a whole.”
Shaving the amount of time it takes to get to and from work gives commuters more minutes during the day to run errands, spend time with family, exercise or other activities, Slevin said.
While a 2018 Partnership for New York report pegged the cost of the city’s traffic congestion at $20 billion per year, the RPA analyzed the flip side of that: what is the region’s economic boost with the new toll? The RPA calculates the annual value of time saved to be $500 million to $1.3 billion as more people spend less time in traffic, according to the report.
New Jersey stands to gain the most from the estimated economic lift, as much as $756 million a year. Queens may see a $257 million annual benefit while Long Island could gain $108 million.
The new toll has cut down on traffic. There are about 60,000 fewer cars per day in the tolled zone since the fee began, a 10% drop, according to the Metropolitan Transportation Authority, which runs the city’s transit system and is implementing the toll. Morning travel times on bridges and tunnels going into Manhattan have declined.
While there are benefits to congestion pricing, the program is at risk under the Trump administration. The Federal Highway Administration last month said it plans to withdraw its agreement with the MTA that allows the transit agency to charge drivers going into the zone. The MTA immediately sued, seeking a court order to declare the FHWA’s actions as “null and void.”
