Oct
06

It’s time to stop subsidizing the NYC Ferry fares

By · Published in 2019

The EDC finally released demographics of ferry riders, and the fare subsidy should now come under political scrutiny.

Let me ask some questions about the NYC ferry system. Your answers, I believe, will depend entirely on your experiences and your convictions: Is Bill de Blasio’s signature transportation initiative — the New York City Ferry system — a success? Should the city keep subsidizing fares to keep the cost of a ferry ride on par with a $2.75 MetroCard swipe?

Perhaps your answer depends on your commuting habits. If you’re a ferry ride who views them as more “civilized” than the subways or buses, as some riders told The Village Voice last year, you may feel the ferries are great. But if you learn the ferries began with a subsidy of $6.60 per rider that has since increased to nearly $10 per rider (and could reach $16-$24 per ride on future routes), you may feel the ferries are a giveaway, a success through legalized governmental bribery.

Much as I’ve made a career out of questioning the boats, for his part, the mayor has made a career out of defending them. He’s held, by most accounts, 10 press conferences about his ferry system, and each time ridership numbers are announced, he makes a scene about praising them as better than projected. In a way, that’s true; after all, the ferries saw 2.5 million riders over the summer and daily volumes have been a bit better than expected. But that’s because each rider is essentially being paid to take the boats. Sure, they’re not getting actual cash in hand, but they are getting generously subsidized.

Over the years, many transit advocates and supporters have criticized the boats. I’ve been particularly vocal on that front, penning a piece in May of 2018 questioning Bill de Blasio’s love of low-capacity transit, and following The Village Voice piece, I voiced more skepticism in a piece for Curbed New York. Underlying the criticism of the expensive subsidy has been a lack of transparency regarding the details of those who ride the ferries. Anecdotally, The Village Voice found a bunch of wealthier-than-average New Yorkers who would have taken the subway for the same price but enjoyed the boat rides, and when I looked at Census districts near ferry docks, I found that the median household income in Census districts one mile from the docks was around $20,000 higher city average. Thus the ferries also raise a question of policy and prioritization: Are these the transit riders and mode of travel we should be subsidizing so heavily?

Despite long-standing FOIL requests from both Aaron Gordon and The New York Post and a pledge of transparency, the NYC EDC had never publicly released demographics studies of ferry riders until last week. Now that we’ve finally received an official glimpse of the demographics of ferry riders, we can now say definitively New York City should stop spending hundreds of millions of dollars of taxpayer money heavily subsidizing a luxury, niche, low-capacity transit option that largely attracts New Yorkers wealthier than city average and wealthier than those who rely on any other mode of transit.

The NYC Ferry largely serves those within walking distance to a dock. (Source: NYC EDC)

The results of the survey as the EDC wants you to see them are available here as a PDF. It’s notable that the city released only a 13-page summary and not the raw data because it allows the EDC to set the tone. Even still, the numbers do not make a strong case for continued substantial investment in the ferry fare. As the EDC unavoidably must note, most riders “live near the water and in walking distance of a [ferry] landing.” In fact, nearly three quarters of all riders walk to the landings while the EDC notes that 6 percent bike and 11 percent take the subway or bus. The remaining 11 percent use a car, and the EDC notes that most of the drivers are heading the boat that serves the Rockaways.

There’s not much to learn from those figures, and I’ll return to them in a second. But this slide is the most damning:

EDC data offers a glimpse at the economics of ferry riders.

As you can see from the EDC’s data, ferry riders have a median income between $75-$99,999, and while that’s a big income window, it’s already higher than the median income for the service area. While it’s not clear if this is individual income or household income, it’s far higher than median household income across the city or for users of other parts of the transit network. The median household income for NYC is around $63,000 per year while individual median income is around $38,000. The average median individual income for an employed subway rider is around $40,000 and for bus commuters is around $28,455 (per data published in 2017 by Scott Stringer). So no matter how you slice it, we’re spending over $9 per ride to subsidize a low-capacity transit service for New Yorkers who are, on average, on the high side of the income scale.

It’s long been assumed the ferries were a bad investment that do little to improve mobility for the New Yorkers who need it most, and now we have the numbers to back up that reality. While some, such as the Manhattan Institute’s Nicole Gelinas, have argued that these taxpayers would exit New York or perhaps otherwise drive without this generous ferry subsidy, it’s hard to see how those arguments play out. The ferries are, after all, not even three years old yet, and New Yorkers have been flocking to the waterfront for the better part of two decades. Plus, most of the ferry riders who spoke with The Village Voice said they would shift to transit if faced with a choice, and many would stick with the boats even at a steeper fare. As the ferries themselves are net polluters, the environmental argument doesn’t hold up too well either.

Meanwhile, as new analysis from the Citizens Budget Commission points out, the NYC Ferry subsidy is the second highest in the nation, and every city other than New Orleans that offers ferry service does so at a higher price point. As the ferries are bleeding taxpayer dollars, the CBC calls for a “reconsideration of the operating strategy and pricing model.”

At this point, we can comfortably say Bill de Blasio is subsidizing a luxury travel option for relatively few people who tend to be wealthier. These aren’t the folks facing a mobility crisis whose buses are stuck in traffic or who can’t afford transit fares. These aren’t folks who have endless commuters from far-flung areas of the city, and it’s time to stop the giveaway. We make these types of policy decisions routinely, and it’s time to admit that a ferry fare subsidy was a bad idea. If the city wants to invest capital dollars into the ferry system and if the city can support a ferry system with a much smaller fare subsidy — say $2-$4 to align it with subways or the more popular express bus routes — so be it. But a handout to a private ferry operator so a few people pay the equivalent of a MetroCard swipe for a “civilized” commute isn’t one we should embrace. It’s time for this subsidy to end.



42 Responses to “It’s time to stop subsidizing the NYC Ferry fares”

  1. j2 says:

    i love this but just so you know, a link tag wasn’t terminated properly and the last 2 paragraphs act like a link to the other transit challenge pdf!

  2. Chris P. says:

    I completely disagree with this articles factual assortment of the annual income of the riders just because the docks are in a certain location. #fakenews

    • VLM says:

      You disagree with the facts that Ben’s laid numerous times so, to you, it’s fake news. Got it. You’re just another wannabe Trumpian clown who sounds like a moron.

    • Goljerp says:

      Hi Chris,

      Perhaps you didn’t notice the heading on the second slide — this is the self reported income (ranges) of riders. It’s not based on the location, it’s based on the answers that people themselves said. (Sure, you could argue that some people might be embarrassed to admit they are in the 25-49k range and claim to be 50-75k, but on the other hand, some might be embarrassed to admit they were 125-149k and claim to be in the 100-124k bin.)

      It’s true that Mr. Kabak suspected this data based on the location, but the self-reported incomes show that he wasn’t wrong to do so!

    • AMH says:

      Fortunately, facts are facts whether you agree with them or not.

  3. Martin A says:

    Surely though the cost of providing subway or bus capacity expansion for the passengers that use the ferry currently would be way, way more than even a $16/trip subsidy? So by getting people off the subway and onto the ferry they are doing the MTA finances a favour.

    Regardless; when 2nd avenue subway cost is over $4bn/mile, this really does seem like a drop in the ocean compared to the real problems: massively overinflated costs for subway expansion.

    • Steve N says:

      Relative to transit ridership, ferry ridership is little more than a rounding error. The subways and buses carry about the same number of passengers in one day (about 5.5 million weekdays) that the ferries carry all year. If all of the ferry riders were to start taking the subway tomorrow, no one would notice the difference.

  4. Mister K says:

    Subway, Metro and Bus fares across the world are subsidized. Why would the NYC Ferry be any different?

    Do Blasio has plenty of blunders on his resume but the ferry isn’t one of them. It’s extremely popular with families and tourists on weekends and provides a commuter link between
    revitalized waterfront neighborhoods and jobs, conveniently priced in line with the subway.

    • TimK says:

      Subway, Metro and Bus fares across the world are subsidized. Why would the NYC Ferry be any different?

      The point is not that some transit options should not be subsidized, but that the per-ride subsidy levels for the ferry are so high. From the article:

      “So no matter how you slice it, we’re spending over $9 per ride to subsidize a low-capacity transit service for New Yorkers who are, on average, on the high side of the income scale.”

      Per-ride subsidies for the subway and buses are nowhere near $9.

      The point is also that we’re subsidizing people who need the help less than the people who ride the subways and buses.

      • Marcel says:

        Several MTA express bus routes are also subsidized to the tune of $10-20 per ride.

        • Daniel says:

          Exactly! This is a hatchet job. It does not take into account new planned routes in areas with lower income, nor the fact that other commuters use the boats besides people who live in immediate vicinity. It also does not talk about the intangibles of economy expansion on routes. There definitely would not be a hotel being built in Rockaway if not for that ferry stop. It has been practically a century since a new hotel has opened on that side of the peninsula.

          The reasoning that people near high income locations should pay more for public transport is dubious at best.

    • The popularity of the ferry is a matter of scale. The entire annual ridership is equal to half of one day’s subway ridership. And as Tim noted, the issue is the amount of subsidy. There’s no good policy reason to subsidize ferries to the tune of over $9 per ride.

  5. Larry Littlefield says:

    I’ve said it before. The ferries (and BQE streetcar) are like the gym rooms nobody uses in luxury developments, a marketing expense to help sell them. But the developers pay for those gym rooms.

    So the solution is obvious. If waterfront development near the ferries that is already benefitting from a 421a tax abatement is willing to agree to a special property tax assessment (like a Business Improvement District) to keep the ferries, then you keep them.

    If not, then you don’t.

    They don’t have to pay for 100 percent of the subsidy. There is a public benefit to having a ferry system as an occasionally used amenity, though I’ve never used it. But they ought to be assessed enough to cut the public subsidy down to something reasonable.

    • Steelndirt says:

      This approach would also be good in planning future transit expansions, whether it is a ferry service or expansion of the subway system. Increased transit access increases land values, why shouldn’t the MTA use some of that increased value to fund that service?

    • SEAN says:

      Larry,

      I get your point, but your luxury gym example in high end buildings is a poor one. You pay for that space through assessments each month regardless if you use them or not. If you have no intention of using such facilities, then you are just wasting money if you move into a building like that.

      In my area, buildings with gyms, pools & such have $800 monthly assessments Vs $250 for those without.

      • Larry Littlefield says:

        No, that’s exactly the point.

        If is the developers of these buildings, providing campaign contributions to the Mayor, who want the ferries, as an amenity they can use to sell.

        But instead of the developers or owners paying for them, we all are.

        “If you have no intention of using such facilities, then you are just wasting money if you move into a building like that.”

        Better them than the poor slobs on the buses.

        • SEAN says:

          Again, poor example. You as a city resident are not paying for a luxury gym in an unnamed building… that is unless you do live in such a development. That is nothing remotely close to a citywide ferry system.

          • Larry Littlefield says:

            And those who live in such developments should also cover a substantial cost of the ferry subsidy, because that’s who the ferry system is for. Through a special assessment.

  6. Larry Penner says:

    Farebox recovery rates vary based upon the trip, route and time of day. Any rush hour local or express bus, subway, ferry or commuter rail trip carries more riders than mid day, evening, overnight or weekends. Rush hour trips tend to have a better fare box recovery rate and require less subsidy than other times of day and night. There is always a fixed cost per hour for any mode of transportation. This includes equipment (bus, subway car, train or ferry purchase) straight line depreciation of equipment over time and mileage, driver, engineer or ferry boat captain’s salary, conductors, ticket takers, deck hands, fuel or power and maintenance of equipment.

    Those NYC residents who already utilize either the LIRR, Metro North, MTA Bus or NYC Transit Express Bus are aware the cost is more than either the bus or subway. There are already almost 100,000 NYC residents who travel weekday to and from work paying extra to ride the LIRR, Metro North, MTA Express Bus, NYC Transit Express Bus or other non subsidized private ferry. All understand that they are paying for a premium service. Riders who utilize NYC Economic Development Corporation Private Ferries need to do the same by paying more as well.

    Why not include advertising inside and outside of boats? This could generate revenue to reduce government subsidies. Recent outlawing waterborne electronic billboards is disappointing. This is sad for those who cherish free speech. Perhaps some have forgotten about the Bill of Rights and First Amendment. Advertising is a multi billion dollar business helping fuel our free enterprise economy. If you don’t like the ad, don’t buy the product. Advertisers will get the message. This is life when you live in a free and open society.

    Has Mayor Bill de Blasio ever asked NYC DOT Commissioner Polly Trottenberg to submit grant applications on behalf of NYC Economic Development Corporation to both the FTA Passenger Ferry Program and New York State Department of Transportation? There are other annual FTA grant programs such as Urban Area Formula, Capital Annual Investment and Congestion Mitigation Air Quality that could also be used as funding sources.

    Why not apply for capital grants from Washington and Albany to assist in funding? NYCDOT does this and receives millions annually on behalf of the Staten Island Ferry. Albany also provides State Transportation Operating Assistance for transportation systems such as the Staten Island Ferry along with local share against federal grants. Ridership on any transit service generates yearly federal transportation formula capital assistance. Numerous past private ferry operators have come and gone. They could not financially survive based upon farebox revenue alone without government subsidy. MTA bus, subway and commuter rail along with NYCDOT Staten Island Ferry is subsidized by a combination of City, State and Federal assistance for both capital and operating costs. All of these proposed new ferry services will require similar subsidies to survive.

    The Federal Transit Administration this past February announced the opportunity to apply for approximately $30 million in Fiscal Year 2019 competitive grant funding for passenger ferry projects nationwide. The Passenger Ferry Grant Program is authorized by Congress for projects that develop and support ferry service on many of the nation’s waterways, including the purchase, repair, and modernization of ferry boats, terminals, and related facilities that communities depend on.

    FTA awarded competitive grants to states and public entities to purchase, repair, or modernize ferry boats, terminals, and related facilities and equipment, supporting existing ferry service and the establishment of new passenger ferry service.

    The NYC Department of Transportation has a backlog of available Federal Transit Administration Passenger Ferry and Bus discretionary funding. They have been unsuccessful to date in accessing these. The March 15th FTA Federal Notice of Available Funding for Federal Fiscal Year 2019. This included the availability of $16,276,971 from 2014, 2016 & 2018 to pay for three new NYCDOT projects.

    These include (1) $5,700,000 from 2014 for Ferry landing modernization and conversion to CNG Compressed Natural Gas for fueling boats, (2) $4,237,771 from 2016 to construct a combination of bus lanes, high-quality stations, refurbished bus stops and transfer points, safety improvements, and transit signal priority and signal timing changes and (3) $6,303,200 from 2018 for facility/vessel gangways replacement/upgrade and ferry boat environmental compliance.

    NYC DOT should have previously developed and submitted grant applications to apply for these funds. Has NYC DOT been successful seven months later to have any of these funds obligated under approved grants?. These funds will eventually lapse and be lost to NYC DOT. They end up returned to the federal treasury and may be reprogrammed to another purpose.

    When will NYC DOT be successful in applying for and having these funds obligated under approved grants? What is the recovery schedule for completion of these long overdue projects? How many more years must taxpayers, ferry & bus riders and ferry maintenance employees have to wait before seeing the benefits from completion of these federally funded improvements to the Staten Island Ferry system?

    (Larry Penner is a transportation historian and advocate who previously worked 31 years for the U.S. Department of Transportation Federal Transit Administration Region 2 NY Office. This included the development, review, approval and oversight for grants supporting billions in capital projects and programs on behalf of the MTA, NYC Transit, LIRR & Metro North, MTA Bus, New Jersey Transit and NYC Department of Transportation. This included over $1 billion in grants to NYCDOT for bus and ferry projects and programs).?

    .

    .

  7. Ian20x says:

    Anyone know the subsidy per person for the Staten Island ferry?

    • ChrisC says:

      I’m sure Ben did a piece a couple of years ago on this and there was a report that basically said the costs of installing fare gates their maintenance etc would be more than any marginal income that would be collected because almost all users of the ferry would be covered by metro cards.

      As to the $5.42 how does that compare to other modes such as the SIR, LIRR, Buses etc etc

  8. terry says:

    Another loooooooooooooong winded cut and paste job.

  9. Tempus Fugit says:

    Benjamin: Please delete the Penner comments. They detract from your otherwise insightful blog.

  10. Elizabeth Shumate says:

    I love the Ferry. I’m low income. More relaxing a great way to chill before or after work yr round. Can’t always do in am but love the rides home. Have to take bus to end of line to get S Bklyn Ferry. So worth the mental relaxation. Total travel time is 2 hrs home from Soho to Gravesend.

  11. crazytrainmatt says:

    Wikipedia says the JFK airtrain gets 7.7M annual riders to the rail termini, and EWR looks to be ~2M, putting them at about double the ferries’ ridership even without counting the huge intra-airport ridership.

    Anyone want to guess what the average income is for AirTrain riders vs. private car dropoffs at the airports?

    Or how about income of people who use the free electric vehicle chargers in the JFK garages vs. those who park their bikes at Lefferts Boulevard?

  12. BruceNY says:

    I have felt from the very beginning that it would make more sense to charge the same fare as express buses (and the MTA should do the same for the LIRR/MNRR within city limits). Having said that, this mayor and his wife, with her billion dollar completely unaccountable “mental health initiative”, have no qualms about spending taxpayer dollars in foolish, self-promoting ways.

  13. Phantom says:

    I take the ferry once in a while from Wall Street to ” Sunset Park ” ( Rockaway Line ) or Bay Ridge ( South Brooklyn Line ). It’s a nice luxury service.

    Most of the time, even close to rush hour, it’s surprising how few passengers there are. The only major exception would be in the summer when the beach bunnies travel to Rockaway in large numbers.

    Many of the stops ( including the two that I mention ) are pretty far from where most people in those areas live. In the case of ” Sunset Park ” an awful lot of riders seem to be outside the area people who travel to the huge pier by car.

    For many riders, the issue isn’t that there is any transportation void that is being filled. Places like Sunset Park, Bay Ridge and Rockaway IMO are well served by the N, R, A ( despite the constant moaning from the complainers’ society in these areas). The issue is that some people don’t want to take the subway.

    I’ve said before – when the next major financial crisis, this completely unjustified ferry system will be the first thing to be axed.

  14. Chet says:

    I think it’s basically unfair to single out the NYC Ferry for its subsidy when basically every means of public transport receives some sort of subsidy to keep fares at their current levels.

    As a Staten Islander, what we pay for public transport and the service we get really isn’t all that great and that’s being polite. Yes, our ferry is free but it takes a local bus close to 30 minutes to go 4.4 miles down Victory Blvd to St. George and then after waiting as little from nothing to 20-25 minutes for the next boat, there’s then a boat ride of 25 minutes. In short, the $2.75 for the bus and the free ferry takes about an hour to get me to lower Manhattan (and I live the Castleton Corners area, far from Great Kills or Tottenville).

    Next year, we will get an NYC Ferry from St. George to Battery Park City and Hudson Yards. From St. George, that $2.75 will get me to the far west side at 39th St. a touch over an hour… that’s about 45 minutes less than it would take now.

    Should that ferry cost us more than $2.75? I don’t think so. Making it more expensive will just result in empty boats.

    • SEAN says:

      It’s interesting to note the NY Waterway charges $9 for an 8-minute ride across the Hudson from W 39th Street to Weehawken Vs $2.75 fare for a longer trip from the outer boroughs. It’s a matter of value for fare spent. This reminds me… it’s worth noting the one way fare from W 39th street to Weehawken on NY Waterway is $9 & the trip is under 10-minutes.

    • AMH says:

      It’s absolutely fair to single out sky-high fare subsidies. The boats are nice but subsidies should be kept to a reasonable level. Bus and train subsidies (not counting LIRR and express buses) are nowhere near what the city is pouring into the boats.

  15. Scott says:

    Let study what the median income is along the Newly built Second Avenue Subway. The most expensive subway extension in the world. Maybe we should use that money for other areas in city who are more deserving.

  16. The Hunkster says:

    It’s a shame that Mayor de Bozo how’s down to the real estate industry to have “first-class” ferry service for a cost of a subway fare. Then again, that explains the lower than projected ridership numbers and higher than projected operating costs, in which hundreds of millions of our own tax dollars were wasted are these pet projects.

  17. The Rivers Matter says:

    Subsidizing the ferries makes them more affordable to commuters. The ferries are by far the best way to commute into Manhattan. The subsidy should continue. We need to recognize how many people dislike depending on the subways and buses, and design better public transportation alternatives. Support the ferries.

  18. AMH says:

    Spending hundreds of millions of dollars on luxury boats while ignoring millions of bus riders is inexcusable. We can and should have a world-class bus system by now. De Blahsio is the worst kind of fake progressive, wasting precious time while our city regresses.

  19. Snowy says:

    No one is ignoring bus riders. To speed up buses cars were just kicked off 14th Street, despite a subway system that runs the entire length of 14th Street. Why not get serious about this being an island city? Ferries are a transformative commuter, development, and tourist opportunity. Bloomberg had great vision about the potential of waterfront neighborhoods to transform New York, and at least De Blasio is creating alternatives for riders from Astoria to the Rockaways. Bravo.

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