NEW YORK CITY-Lawmakers on both sides of the Hudson River are up in arms after media reports that the Port Authority of New York and New Jersey, in response to a lawsuit over its most recent bridge and tunnel toll increases, filed court documents stating that the increases would not be used to pay for construction at the World Trade Center. The legislators allege that the Port Authority’s current stance contradicts its earlier statements that cited cost overruns at the WTC site among the justifications for the increases, which also include fare hikes on the PATH rail line between Manhattan and New Jersey’s major cities. A spokesman for the Port Authority declines to comment.

“The Port Authority’s current position that the toll increases will not be used to finance redevelopment of the World Trade Center is patently false,” Rep. Michael Grimm and New York State Assemblywoman Nicole Malliotakis, both of whom represent Staten Island, say in a joint statement. In its own August 5 press release, Grimm and Malliotakis say, the Port cited the WTC project no fewer than three times “as justification for the proposed increases.” In one of those references to the project, the August 5 release cites the $11-billion cost to date of redeveloping the WTC site as one of the economic factors necessitating the hikes.

Similar statements were issued by New York State Sen. Charles Fuschillo and New Jersey Assemblyman Gary Schaer. Schaer on Thursday made public a letter to New Jersey Gov. Chris Christie asking him to investigate whether the Port misled the public in justifying the toll and fare hikes.

In a joint August 18 letter to the Port’s board, Christie and New York Gov. Andrew Cuomo had written that they would not oppose a scaled-down plan for increasing the tolls and PATH fares, provided that the Port immediately launch an audit of its own finances. The Christie/Cuomo letter noted that the scaled-down increases “will allow for the completion of the World Trade Center as well as hundreds of other capital projects that will ensure the safety and economic viability of a transportation system that millions of New Yorkers and New Jerseyans rely on.”

This past October, both Grimm and Malliotakis filed an amicus brief supporting a lawsuit brought in US District Court in Manhattan by the American Automobile Association’s New York and North Jersey chapters against the Port. The AAA suit, filed Sept. 27, says that in accordance with a 1987 federal court ruling, any toll increases by the Port must be used strictly for transportation initiatives, according to the Sept. 27 complaint.

In court documents filed Nov. 18 in connection with its motion to dismiss the suit, the Port says the AAA suit’s entire case hinges on the “mistaken allegation that the toll increases will fund the redevelopment of the World Trade Center,” a facility outside the Port’s Interstate Transportation Network. “Rather, the toll increases will be completely absorbed by the expenses of the facilities solely within the ITN.” Grimm and Malliotakis say that the Port’s stance in court filings represents “a clear attempt to dodge our argument that the Port Authority cannot increase tolls in order to fund non-essential activities.” 

It’s not clear, however, that the Port, or Christie and Cuomo, ever explicitly claimed that the increases per se would be used to pay for redeveloping the WTC. For example, the August 5 news release cited by Grimm and Malliotakis lists a number of major capital projects that would be financed by the toll and PATH fare hikes—including replacement of the 340-car PATH fleet and raising the Bayonne Bridge—but does not list the WTC among them. Similarly, in comments at the August 19 board meeting at which the toll and fare hikes were approved, Port Authority chairman David Samson cited WTC redevelopment among “projects that must continue” as part of the bistate agency’s $25-billion, 10-year capital plan, but he did not say that the higher tolls and fares would go toward paying for it.

On Thursday, the Port announced that the New York State Liberty Development Corp. had sold $672 million in Liberty Bonds on the Port’s behalf, which will help to finance continuing construction at 1 World Trade Center. The future home of publishing giant Cond

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.