Welcome to New York; That'll Be $8

American cities look to London for a controversial traffic solution.

ByABC News
July 13, 2007, 11:12 AM

July 14, 2007 — -- One of the last free things in New York City may soon have a price tag.

New York City Mayor Michael Bloomberg wants to solve the city's growing traffic problem by charging a fee for every car entering the city. His plan would charge cars $8, and trucks $21, to drive into Manhattan south of 86th Street.

Other cities are considering similar plans and will be watching New York closely.

The plan is expected to clear the streets and the air, but it is not without its opponents. A recent WNBC/Marist poll found that 61 percent of residents in New York City and nearby suburbs oppose Bloomberg's plan. Among Manhattan residents, 48 percent support the plan and 46 percent oppose it.

And city officials have another headache -- a deadline. They must get approval from the state government in Albany by Monday or they risk losing a chunk of federal money. The U.S. Department of Transportation will choose as many as to three cities for congestion pricing pilot programs. The selected cities would receive $500 million to implement the program.

While it may seem Bloomberg has his work cut out for him, he is not without guidance. New York City has sent representatives to London, where congestion pricing has been in effect since 2003 and some call it a success.

London drivers now pay $16 a day to enter a central "congestion zone."

As in New York, there were protests at first. But after four years, authorities say the program works.

"It's gone better than we thought it would go," said Michelle Dix, the director of congestion charging. "It was an overnight success."

Initially, congestion dropped 20 percent, traffic moved faster and harmful emissions were cut. With so much success, London's mayor decided this year to increase the charge from $10 to $16 and to expand the zone.

London's success didn't come cheap, but is now paying off. The system cost $280 million to set up, but now generates $440 million a year in fees and fines. More than half of the $440 is pure profit that goes back to the city.