New York Attorney General says E-ZPass perks for MTA board members illegal, must cease

May 29, 2008

The New York State attorney-general has said that free E-ZPass accounts for members and past members of the Metropolitan Transportation Authority (MTA) board are illegal and should immediately be revoked. But the MTA arguing "we've done it for years" will take the matter to court, seeking a judgment on the legality of the perk.

The New York "Daily News" reports that 21 of 22 members of the MTA board of directors and some 37 former board members have free E-ZPass accounts allowing them toll-free travel throughout the E-ZPass area. The MTA is the state agency which runs most of the trains and buses in the New York City metro area and also owns the Triborough Bridge and Tunnel Authority which operates seven toll bridges and two toll tunnels in New York City. Toll rates of the TBTA are among the highest in the country and it is the largest grossing toll agency in the US.

The Attorney-General Andrew Cuomo formally wrote to the MTA May 27 asking the Authority to "immediately terminate and rescind all free E-ZPass tags that have been provided to past and present MTA board members."

"It has come to our attention that current and past MTA board members have been receiving free E-ZPass tags. The Attorney General believes that providing E-ZPass tags for free is a form of compensation and therefore violates the Attorney General's Opinion and the MTA's own enabling legislation."

A formal Attorney-General opinion in February 2007 put an end to two New York state housing agencies paying health insurance premiums of board members saying that was illegal compensation. However payment of expenses incurred as part of board work is permissible.

The letter goes on: "Accordingly, the MTA should immediately terminate and rescind all free E-ZPass tags it has provided to its current and past board members."

If the MTA will not immediately stop the perk, Cuomo's letter says, it must document the details to assist in prosecution:

"If the MTA is not inclined to immediately terminate and rescind these tags, the Attorney General asks that you provide the names of those persons who currently have free E-ZPass tags, how many tags each person has, and how much each tag has cost the MTA over the past 6 years, so that we may consider bringing appropriate enforcement actions."

see NY AG's letter:

The New York Times today quotes the MTA board chairman H Dale Hemmerdinger as saying that free passes for tolls and fares have been policy "for decades" and had not been challenged by previous attorney-generals. The MTA board discussed the issue in closed session recently and approved seeking a court ruling on the legality of the practice.

Kalikow has eight freebies

The MTA says that 58 current and former board members have a total of 95 transponders. Former board chairman and multi-millionaire Peter Kalikow has eight free E-ZPass transponders, suggesting he has spread them around among cronies, servants, mistresses and the like?

Thruway agrees to end free E-ZPasses

Cuomo wrote a similar letter to the New York State Thruway which has agreed to comply and has terminated E-ZPass perks for its board members.

BACKGROUND: This scandal was first publicized by CBS TV News in New York mid-November 2007. It reported the amazing number of 24,000 free E-ZPass transponders as being in circulation in New York City and unlimited issue of transponders to board members of MTA.

None of the rest of the media took up the issue however. We were amazed, given that outside New York City toll executives (in Delaware and Ohio for example) have been fired for taking the odd free lunch or allowing a contractor to pay for a round of golf - quite petty stuff by comparison to the gross abuse CBS had revealed. (CLARIFICATION: The reference to Delaware is to the Delaware River & Bay Authority, a joint DE,NJ authoirty, not to DelDOT 2008-05-31)

COMMENT: Of course this is a racket. Everyone should pay their tolls, except emergency vehicles going to an emergency in situations where toll payment would delay them, and toll agency staff or contractors going about their work on the toll facility. Every other free ride is an abuse.

Hemmerdinger is right that this racket goes way back. He says it goes back "decades." Actually it goes back centuries. From medieval times in Europe toll charters provided for free passage by toll bridges and turnpikes by monarchs and their court and various hangers-on and favored classes.

The clergy of the established church were exempt too, a practice that led to many funny tales of impostors in clerical getup evading the toll, or being defrocked by vigilant toll collectors.

Old rackets at the toll plaza are no less rackets because they are old. They originated in brutal corrupt feudal oligarchies, and a democratic republic shouldn't tolerate them.

It is particularly telling that the modern MTA should be defending this kind of corruption. The Triborough Bridge and Tunnel Authority - the MTA's major profit center - was one of the country's first public toll authorities. It was established as a public authority in reaction to abuses by investor-owned but government subsidized toll bridge companies like the New York Bridge Company (NYBC). Its Tammany Hall and Brooklyn Ring management was deeply involved in payoffs to legislators during its construction of the Brooklyn Bridge.

The reform movement which revoked the charter of the NYBC and caused the Brooklyn Bridge to open as a public toll bridge held that public authorities were needed precisely to prevent the kind of abuse and favor-trading that the present MTA now seeks to legalize.

see earlier report

TOLLROADSnews 2008-05-28

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