NYC Ferry underreported hundreds of millions in costs, audit says

New York City's ferry system, which is called NYC Ferry, is costly and poorly managed, a recent audit found.

Under Mayor Bill de Blasio, NYC Ferry underreported around $224 million in costs, forcing taxpayers at times to pick up the tab. (NYC Ferry is owned by the New York City Economic Development Corporation, a semi-independent agency controlled by the mayor, and operated by the company Hornblower Cruises.)

"The audit that we are releasing today shows that during the de Blasio administration, EDC failed to provide the transparent, accurate oversight and financial management that is required of them," City Comptroller Brad Lander said. 

Lander accused the administration of de Blasio, who left office at the end of 2021, and the Economic Development Corporation of false financial reporting.

The highly subsidized ferry system was designed to charge riders $2.75 per trip. De Blasio, when he was mayor, said after that what gets kicked in is a per-ride subsidy of $6.60. However, the actual number is nearly double that, according to Lander's audit. And it's not the only discrepancy.

Taxpayers overpaid Hornblower, the city's partner in the ferry service, $2.8 million more for a vessel than what it was worth. Lander said that money was never returned.

"Because of poor oversight and poor financial management of that contract, our audit found that the ferry has incurred $66 million in unnecessary expenses," Lander said. 

De Blasio, who is now running for Congress, pushed back on Monday saying that he disagreed with the findings of the report. He pointed to capital expenses being added to the total costs.

"Those docks, that capital equipment, we're going to be using that for 10 to 20 years," de Blasio said. "That is not how you calculate the cost per ride. That is a foundational investment. So I would say I think he missed the forest through the trees."

But Lander said that calculating capital expenses in the total costs is a practice the city used from 2002 to 2017.

"The city removed capital expenses from its calculation in 2018," Lander said. "Not so coincidentally, shortly after, then-Mayor Bill de Blasio announced a $300 million capital investment in the system."

Mayor Eric Adams has expressed interest in possibly raising the cost for these ferry rides, which are considerably cheaper than ferry services in other cities. He emphasized the need, however, for this ferry service to continue to connect with underserved communities.

"I was out in Queens the other day in a transportation desert," Adams said. "And speaking to the residents in the NYCHA development, the pier is right there, and they said that ferry is a lifesaver for them."

Adams said he will be making changes though to the ferry system and will be making an announcement on it soon.