Public subsidies are by no means new for the ferry industry. Government agencies, including the Port Authority and the state Department of Transportation, have spent more than $350 million to build new docks and terminals since NY Waterway started, but have generally shied away from subsidizing the operations.
That began to change on April 30, however, when New York Water Taxi launched its inaugural trip from Yonkers to the World Financial Center, a $12, 45-minute ride that is supported by a $4.2 million, two-year subsidy from the Lower Manhattan Development Corporation. By contrast, a commuter would spend $9.50, and take about as long, to ride Metro-North and the subway to the financial district. (Volume discounts make both options more appealing.) But the ferry lets people avoid the crowded Lexington Avenue subway line, and if one works on the Lower West Side (or near the eastern end of Wall Street, where the water taxi makes its second stop), it could be faster and far more pleasant.
All these caveats—limited location, competition from alternatives, higher prices—add up to what ferry-watchers call a “niche business” that accounts for about 3 percent of total commutes daily. But the Bloomberg administration considers it to be an important and—even with public subsidies—fairly inexpensive niche.
“Ferries are easy,” said Deputy Mayor Dan Doctoroff. “There is very little infrastructure, and it is easy to get them operating. They provide access to many hard-to-reach points in the city that are not served by subways and, as a result, are an inexpensive, easy way to implement strategy for dealing with those areas.”
Right now, privately run ferries account for 37,000 one-way trips a day. But Mr. Doctoroff said that he thinks the number of passengers carried by private ferries could easily triple over the next decade.
“In 10, 15 years, we could have 50,000 to 60,000 people living along the waterfront,” Mr. Doctoroff told The Observer. “Over time, we wouldn’t have to provide a subsidy at all. We would have to in the short run, but it would be modest in the scheme of things.”
The key, Mr. Doctoroff said, would be in determining which routes make the most sense from an economic and public-policy point of view, and in structuring the most effective subsidies. He said City Hall hadn’t worked out those details yet, although it is currently in the process of obtaining a vendor to operate a route along the East River and will soon look for one to run a route to the Rockaways in Queens.
Compared with the $50 billion that the Mayor, in his PlaNYC document, suggests spending on transportation, the $40 million for ferries is a drop in the bucket. And it may be far from enough—able to cover just 10 other Yonkers-ferry-style subsidies from now until the year 2030.
About $10 million of that amount would come from congestion-pricing fees; another $30 million would come from other sources, according to the nonbinding plan.
One of those other sources will likely be the federal government, for which the Bloomberg administration is preparing a grant application over the next two months to get some of the $1.2 billion available for transportation innovations. The Mayor would like to ask for money to support the cameras and other infrastructure needed to implement congestion pricing, but that would require a sign-off from Governor Eliot Spitzer, who has yet to endorse the charge to drive into Manhattan. Ferry subsidies, on the other hand, could be administered without any cooperation from Albany.
Jeffrey Zupan, a senior fellow for transportation at the nonprofit Regional Plan Association, convened a closed conference of ferry experts last November. The consensus, Mr. Zupan said, was that ferries needed and deserved public subsidies. And yet that conclusion caused many anxieties, among them the prospect of opening a stream of public funds that would get larger and larger and make less and less sense.
“You have to draw some well-defined lines in the sand and say, ‘We are not going to subsidize this beyond some level,’” Mr. Zupan said. “I don’t know what that level is. Maybe you can even memorialize it in some kind of legislation.”
Mr. Doctoroff, however, anticipates that different routes would need different levels of subsidy. Some routes, apparently, don’t need subsidies at all. SeaStreak, a high-speed ferry company that brings over 1,550 people daily from Monmouth County, N.J., to Manhattan, makes a “substantial enough” profit, according to general manager David Stafford. (Its parent company, Sea Containers Ltd., however, has put the service up for sale to focus on its core cargo service, he said.) And, despite its troubles, NY Waterway expects to make a slight profit this year.
“Frankly, we are up against all the subsidized systems, the trains, all the public systems, and
so we have got to offer a premier service,” Mr. Imperatore said. “It’s a private, entrepreneurially driven effort, and naturally, we are always spit-and-polish.”