Port Authority floats fare, toll hikes to support more capital spending
The Port Authority of New York and New Jersey is proposing higher user fees to fuel a larger capital budget.
The bi-state agency announced plans Tuesday to raise fares and tolls on its trains and crossings to backstop large-scale infrastructure projects. The extra revenue would enable the Port Authority to increase its 2017-2026 capital plan to $37 billion from $32.2 billion in response to rising construction costs for projects already under way.
“At a time of the Port Authority’s unprecedented investment in our region’s infrastructure to upgrade Port Authority facilities to 21st century standards, we must be prepared to provide needed funding,” Port Authority Executive Director Rick Cotton said in statement. “These recommended increases in tolls and fares are both needed and measured.”
Port Authority officials said that the 94%, or $4.5 billion, of the capital plan increase would be funded through incremental project-related revenues. This includes revenue increases from user fees, terminal rents, airline cost recoveries and anticipated receipts of passenger facility charges, according to the transportation agency.
The proposed user fee changes that are subject to board approval would include a new “ground transportation access fee” at the Port Authority’s three major airports to be implemented in 2020. The proposal would follow a model used at Los Angeles International Airport, with a $4 charge for ride-hail vehicle pickups and drop-offs along with a $4 per-taxi pickup fee.
The Port Authority is also proposing hiking fares on the Newark and JFK Airtrain and raising multi-trip SmartLink card fares to $2.60 a ride by 2020 from $2.10.. Cash tolls on Port Authority bridges and tunnels are slated to rise to $16 from $15 with E-Z-Pass tolls jumping $1.25.
The higher capital plan is largely aimed at adding needed funds for airport initiatives including an additional $1.64 billion for a new Airtrain at Newark Liberty International Airport. The project, which is expected to cost $2.05 billion in total, would replace the Port Authority’s planned spending of $300 million in the capital budget to keep the current AirTrain in a state of good repair.
The revised capital plan would also provide $390 million of new funding for an AirTrain project at LaGuardia Airport, considered a key component of the 80-year airport’s $8 billion overhaul. A planned monorail for LaGuardia is now projected to cost $2.05 billion, up from a previous estimate of $1.5 billion.
The $13 billion JFK Airport redevelopment project will receive $1.9 billion of additional funding from the higher capital plan to be used for infrastructure improvements. Newark Liberty is also receiving $350 million extra for the airport’s $2.7 billion Terminal One redevelopment.
The Port Authority is one of the nation’s largest municipal bond issuers with $22.1 billion of outstanding bonded debt at the end of 2018, according to its year-end financial statement. The transportation agency’s debt is rated Aa3 by Moody’s Investors Service and AA-minus by S&P Global Ratings and Fitch Ratings.