New York's Cheapest Rent — a Street

Cheaper than renting an apartment or even a storage unit in Manhattan is leasing one of the city's scarcest resources — a street.

Even as Mayor Bloomberg seeks to reduce traffic in the city by charging drivers to use the most crowded thoroughfares, the city is issuing more than 200,000 permits a year to close traffic lanes and is charging developers as little as $50 for three months of road use, according to data provided by the Department of Transportation.

A citywide construction boom in the last few years has required many lanes to be closed for months and even years at a time. Closed streets are a nuisance to both drivers, who must endure increased traffic, and to local residents, who are often forced to navigate makeshift sidewalks.

In parts of Midtown Manhattan with the worst congestion, such as the area around Times Square, developers are charged no more to take over lanes than for construction sites in the outer reaches of Queens. The Durst Organization, which is erecting a $1 billion office tower for the Bank of America near Bryant Park, has for three years closed the south side of 43rd Street between Sixth Avenue and Broadway, the curb lane on Sixth Avenue near the park, and segments of three sidewalks. During off-peak hours, it has also taken over some traffic lanes on 42nd Street between Sixth Avenue and Broadway. These traffic lanes and sidewalks are likely to be closed through 2008, when the project is scheduled for completion.

The fees have not changed for decades, according to a spokesman for the transportation department. For the use of its roads, the city charges construction managers a $50 fee for new permits every three months to cover the expense of processing the applications, a transportation department spokesman said. For developers slicing open roadbeds to work beneath the street, the city charges $135 for a three-month permit. If the road has recently been resurfaced, the fee can climb to $380.

These lane-closure permits must be renewed after 90 days but can be renewed indefinitely. The city does not factor into these fees the higher cost of congestion when a bottleneck created by a lane closure on one block can slow traffic for miles.

"That model doesn't fit with Mayor Bloomberg's new thinking, and the policy should be re-examined," City Council Member John Liu of Queens said in an interview.

Mr. Bloomberg's congestion pricing proposal would charge drivers $8 to enter Manhattan south of 86th Street during peak hours, a fee that would be offset by any tolls paid to enter the city. "Whether the streets are being used for moving vehicles or construction apparatuses, their value should be extracted equitably from all users," Mr. Liu, who heads the council's transportation committee, said.

"The streets are scarce goods and in order to help people use them more judiciously, we have to start charging something approaching a market rate," the executive director of Transportation Alternatives, Paul Steely White, said in an interview. "Now there seems to be no incentive for contractors to finish quickly."

A spokesman for Tishman Construction Corporation, Richard Kielar, said a higher fee would not speed up construction schedules. "Time is money, and construction proceeds at the fastest pace that's possible," Mr. Kielar said. "Closing lanes is a fact of life in New York City, and we couldn't build without it. In New York, more than in other cities, you're rising right up from the sidewalk."

Opponents of congestion pricing have argued that construction in Manhattan is one of the leading causes of traffic jams on the island. The issue must be addressed before levying road taxes on drivers, they say.

"Construction has a huge impact on congestion," the spokesman for the advocacy group Keep NYC Congestion-Tax Free, Walter McCaffrey, said in an interview. Charging developers a congestion fee, Mr. McCaffrey suggested, could provide the city with some of the resources it seeks to raise through congestion pricing. "A $50 fee sounds like a pretty good deal if you've got a $50 million project going up," Mr. McCaffrey, a former council member of Queens, said. "The fee should be considerably more, so that the city could have additional resources."

The city is considering closing Broadway below Ann Street to all vehicles except city buses beginning in July, The New York Sun reported in March. With 59 residential, commercial, and transportation projects under construction within a one-square-mile radius below Canal Street, some transit advocates and city officials see the busy summer as an opportunity to collect additional funds from the developers and state agencies using the roads to accommodate their construction needs.

A spokesman for the transportation department, Edward Timbers, said the road-closing permits were "not a source where we can seek to generate revenue."