In addition to easing midtown traffic jams, the pricing plan is expected to raise capital funds for metropolitan New York’s major transit system. On April 1, Governor Andrew Cuomo and the New York State legislature approved a congestion pricing plan, under which vehicles that enter certain parts of Manhattan will be assessed a fee. If all goes as expected, congestion pricing will raise $1 billion annually, and those revenues will in turn be used to pay debt service on $15 billion in bonds. When the proposed bonds are offered, investors would be wise to scrutinize traffic projections that underlie expected revenues for bond repayment. It won’t be easy for the MTA and its consultants to arrive at reliable traffic estimates for the congestion pricing plan, and convincing investors of their validity may be more difficult than the MTA might think.

Source: Forbes May 16, 2019 15:56 UTC