After proposed fare increases were announced for the PATH trains and Lincoln and Holland tunnels earlier this month, many New Jersey residents questioned their fairness and the Port Authority’s spending plan that’s being used to justify them.
The criticism increased in the wake of an audit released Wednesday that showed that the PA had paid $85.7 million in overtime to 5,360 of its 6,877 employees last year.
The PA has said it needs additional revenue to cover the cost to rebuild the World Trade Center and other capital projects. Some state officials, however, have scoffed at this explanation, noting that the World Trade Center redevelopment effort has already received insurance money and other funds.
New Jersey residents complained that the money will disproportionately come from them.
Cars that use EZ Pass tags will see a toll increase of $1.50 next month at bridges and tunnels. EZ Pass fees for cars will increase by 75 cents each year from December 2012 through December 2015. Cars that pay their tolls in cash will see the same increases. However, they will be charged a $2 penalty for using cash.
PA head: ‘The case is clear’
According to the PA, the price tag to rebuild the World Trade Center is now more than $11 billion. Earlier estimates put the rebuilding costs closer to $6 billion to $9 billion. The agency has also stated that it has incurred $6 billion in increased security costs since the Sept. 11, 2001 terrorist attacks that destroyed the original World Trade Center and the transportation infrastructure underneath it.
These expenses, the PA has added, came at a time when the national and regional economies have collapsed and projected revenue has declined by $2.6 billion.
In a statement released last week, PA Executive Director Chris Ward said the agency “relies on the toll and fare box as the primary way in which the agency funds its interstate transportation program. As a result of the historic economic recession, those funds declined sharply from the original projections on which our capital plan was based.”
Although Ward didn’t single it out, the cost to raise the height of the Bayonne Bridge to make way for bigger ships is also among the capital improvements the agency is planning.
Thus, the agency wanted to increase fares and tolls by as much as 50 to 65 percent to cover these expenses.
The additional revenue from the fare and toll increases would fund a 10-year capital plan and create 167,000 to 180,000 construction jobs.
Fares vs. jobs
At one public hearing that was held Tuesday evening at the Holland Tunnel Administration Building in Jersey City, vanloads of construction union workers were driven in to express their support for the proposed increases. Arguing that many of their colleagues have gone months without work, members of LiUNA! spoke out in favor of the increases and the estimated 180,000 infrastructure jobs that the PA has said will be created from the increased revenue.
One union worker, Carlton Hill, said at the hearing, “Right now, I’m lucky if I get one day of work a week. And I don’t get any benefits.”
But several Hudson County residents said Tuesday night that money for these capital programs will disproportionately come from them while New Yorkers, airport commuters, and shipping companies get off scot free in comparison.
Garden State residents comprise about 80 percent of PATH users, according to the PA. And about 50 percent of the agency’s bridge and toll revenue comes from New Jersey commuters.
“Yes, jobs will be created [from the fare and toll increases]. But you also have to look at the jobs that will be lost,” said Weehawken resident Seth Huling.
Huling said the fare increase will leave commuters with less disposable income to spend on other necessities and on local businesses.
Jersey City Mayor Jerramiah T. Healy, who attended the Tuesday evening hearing and who made a statement to the Port Authority, agreed the increases would hurt northern New Jersey’s economic competitive edge over New York City.
New Jersey commuters would be among those hit hardest by any increase approved by the PA. Garden State residents comprise about 80 percent of PATH users, according to the agency. And about 50 percent of the Port Authority’s bridge and toll revenue comes from New Jersey commuters.
“When I…saw the $11 billion that it will cost us commuters to rebuild the World Trade Center, I was completely and totally insulted,” Jersey City resident Esther Wintner told PA officials at Tuesday’s public hearing. “The 9/11 attacks were an attack on all of America. To now say that working people, who are commuters from New Jersey, will have to bear that burden is wrong.”
She said rebuilding costs should be shared equally among all U.S. taxpayers and asked why shipping companies aren’t paying to raise the Bayonne Bridge.
“Let’s talk about the World Trade Center, Larry Silverstein, and his business partners,” said one businessman at the hearing. “How much of their own money do you think they really have in this $11 billion World Trade Center reconstruction project? Almost none. And yet, we’re being asked to pay for that on the backs of the fare hikes and the tolls.”
Some have asked what happened to the insurance money that Silverstein should have received.
Root of increases lies in PA-Silverstein deal
It was a year ago this week – on Aug. 26, 2010 – that the PA signed a deal with developer Larry Silverstein that jumpstarted reconstruction of the Trade Center site after a 16-month deadlock.
The PA owns the 16-acre Trade Center site, while Silverstein held the lease for the office towers that were destroyed on 9/11. Plans call for the construction of four new office towers.
The PA is developing 1 World Trade Center, formerly know as the Freedom Tower; Silverstein has the rights to build up to three additional buildings.
Redevelopment stalled, however, after the two sides clashed over financing for the reconstruction effort and the pace of construction. The matter eventually went to arbitration with an agreement finalized in March of last year that was ultimately signed in August.
Under the agreement reached, the PA pledged to contribute $1 billion to help Silverstein finance one of his Trade Center buildings. The agency also agreed to fork over up to $200 million to help him finance another one of his Trade Center towers.
In order to get Gov. Chris Christie’s support for this deal for lower Manhattan, the PA also agreed to give $1 billion to raise the height of the Bayonne Bridge. At present, the bridge cannot accommodate the large size of modern container ships. With the Panama Canal currently being widened to accommodate these vessels, there had been concern that New Jersey ports in Newark and Elizabeth would become obsolete if the Bayonne Bridge wasn’t also revamped to accommodate these ships.
According to several published reports, Christie threatened to veto the PA-Silverstein deal unless the agency agreed to finance the bridge project.
When the deal between Silverstein and the PA was inked last year – with its Bayonne Bridge bonus – it was hailed as a victory for all parties involved, especially New Jersey, even though the transit agency never detailed where it would get all this money.
Tracking the money
It now appears the transit agency expects at least a portion of the money to come from commuters.
This despite the fact that, according to published reports in the New York Times, insurance companies paid New York state $4.5 billion after the terrorist attacks, and the federal government has committed another $4.2 billion for the rebuilding effort in lower Manhattan.
Much of this federal money was specifically budgeted to rebuild the World Trade Center PATH station and to enhance security at the Trade Center site.
U.S. Sen. Robert Menendez (D-NJ) said recently, “It was my understanding that money was already earmarked and set aside for the rebuilding of the World Trade Center. Where is that money?”
E-mail E. Assata Wright at email@example.com.