Many routes to ferry king's success
emperor of New York City's ferries was admiring the
view of Lower Manhattan the other day from his office
as his boats steamed across the river.
Sascha Brodsky; Downtown Express photo by Brad
are the subway of the 21st century" declared
Arthur Imperatore Jr., watching from his New Jersey
headquarters, whose walls are decorated with nautical
charts and life buoys.
Imperatore, whose name means 'emperor' in Italian,
runs 90 percent of the burgeoning private ferry
traffic in the New York area.
New York Waterway, the company started by his father,
Arthur Imperatore Sr., has expanded from a tiny
operation once dismissed as "Arthur's folly"
to a $30 million business.
The gap in the skyline where the Twin Towers once
stood is a reminder of part of the reason Waterway has
come so far so fast. Since PATH service was knocked
out on Sept. 11th, the company has seen a dramatic
jump in riders. It has also benefitted from federal
subsidies put in place as an emergency measure that
some have criticized as unfair and inefficient. In
coming years, the company and its much smaller
competitors will benefit from hundreds of millions of
dollars in government-sponsored projects designed to
increase waterborne transportation.
Waterway's president, Imperatore Jr., a Columbia Law
School graduate, maintains a casual but taught
atmosphere at the company's Weehawken headquarters.
Wearing a polo shirt and khakis, he darted around the
docked ferries, questioning workers about the state of
Few dispute that the ferries are anything but a
welcome relief to the congested and polluted
automobile arteries feeding New York.
"Restoring and enhancing Lower Manhattan's
transportation infrastructure is central to the joint
efforts of the state and city, Lower Manhattan
Development Corporation chairperson John C. Whitehead
said in a statement. "Expanding ferry service is
a creative response and is another important step in
meeting the area's pressing mass transportation
Timothy Carey, president of the Battery Park City
Authority, agreed, saying "Manhattan is an island
and we need more ferries."
But some have criticized the subsidies propelling NY
Waterway recent expansion.
After the destruction of the World Trade Center's PATH
station left hundreds of thousands of commuters
stranded, officials turned to ferries to fill the gap.
The Federal Emergency Management Agency provided funds
through the Port Authority of New York and New Jersey
to give NY Waterway a contract through an unusual
The contract, which has only recently been finalized,
guarantees NY Waterway a 20 percent profit. Under a
complicated formula, Waterway is allowed to bill the
Port Authority an hourly fee for each boat added to
the fleet. Earlier this year, the firm was collecting
$2.7 million a month in subsidies.
Port Authority officials said that the subsidy was not
offered to other ferry companies in the area because
they were too small and due to the emergency nature of
But the owners of some much smaller ferry companies
said they would have liked a chance to bid.
Tom Fox, owner of New York Water Taxi and David
Stafford, general manager of Seastreak, both said
their ferry companies were never asked to bid on the
"Normally if it's an open tender then they would
have asked other companies about it," Stafford
said, speaking by cell phone from one of his ferries.
The new service began by including a free water
shuttle to carry commuters between the World Financial
Center on the Hudson River and Pier 11 on the East
River, as well as more frequent service from the
Hoboken Rail Terminal to the World Financial Center,
and a new route between the Hoboken Rail Terminal and
Scrambling to meet the demands of the new services, NY
Waterway leased 10 more boats and hired 100 new
But the Hoboken route, subsidized at about $2.7
million a month, only boosted ridership from the
Hoboken Terminal from about 10,500 to about 11,500,
according to Imperatore. That adds up to a subsidy of
about $2,500 per month for each new passenger.
The free water shuttle between Pier 11 and the World
Financial Center was shut down June 14 after officials
decided it wasn't attracting enough riders. Waterway
had little incentive to lure riders since it was
guaranteed a fee for the service and some Battery Park
City residents objected because the firm tried to get
approval to dock in the North Cove.
But the company is expanding into other routes. Last
month, NY Waterway began running weekend boats to
Belmar on the Jersey Shore from Manhattan, Hoboken and
Jersey City. The ferries head south on Friday evenings
and return on Sunday evenings. The trip, which can
take three hours by car on a summer weekend, will take
an hour by boat and cost $30 for a round trip. In
Brooklyn the company took over the service from Bay
Ridge to Lower Manhattan that New York City began
offering after Sept. 11. The FEMA-financed service
will remain free for now.
Lisa Peterson, a spokesperson for the Tri-State
Transportation Campaign, a transportation watchdog
group, said, "ridership numbers show that the
money is supporting very few passengers. So, while it
is clearly necessary to provide displaced passengers
with other options, FEMA may not be getting the bang
for the buck that it was expecting."
Port Authority spokesperson Steve Coleman acknowledged
that some routes have been a disappointment.
"We have made some modifications to the services
to try to weed out those not generating riders and we
are looking at the service to see what routes should
be continued," he added. "We are cutting
back service on some routes."
Even without the subsidies, NY Waterway has come a
long way since its founding in the 1980's. When Arthur
Imperatore Sr. formed his own ferry company to bring
commuters across the Hudson River, observers scoffed
that ferries were an outmoded form of transportation.
But Imperatore Sr. proved the doubters wrong and as
the company has grown, he has been a generous
political donor. Like a lot of business owners, he has
given the maximum allowed amount to many state and
federal political campaigns. In April, the Imperatores
hosted a $1,000-a-plate dinner honoring Governor
Pataki at a restaurant owned by the family, Arthur's
Landing, on the waterfront in Weehawken. One of the
firm's ferries is named the U.S. Sen. Frank R.
Lautenberg, after the former New Jersey legislator who
was active on transportation issues.
Imperatore Jr. said the company's government aid had
nothing to do with its political contributions saying
"there has been no quid pro quo."
Imperatore Sr. got his start after World War II, when
he transformed his family's two-rig trucking operation
into what was a $170 million business, APA
Observers said his success was built on innovation and
a tough stance with rough unions. But the company was
sold earlier this year, a victim of a shrinking
Some of Imperatore Sr.'s other ventures have been
In 1981, he bought a 2 1/2-mile stretch of crumbling
waterfront property in Weehawken and West New York for
$7.75 million. He planned to build a Venetian city, a
multi-billion-dollar project that would include town
houses, hotels and an observation tower inspired by
Leonardo da Vinci.
But the project stalled and in 1994, Imperatore Sr.
lost part of the land after a bank foreclosed on a $50
Imperatore originally conceived his ferry business as
a means to attract residents to his mini-city. The
ferries have blossomed where the real estate plan
failed. Waterway is now a $30 million business.
And the private and public ferry trade could become
even larger once a host of maritime projects around
the area are completed. Among the projects is a
revamped St. George Ferry Terminal on Staten Island, a
reconstructed Whitehall Ferry Terminal, a new floating
World Financial Center Terminal, a new West Midtown
Ferry Terminal at West 39th St. on land owned by
Waterway and a new Port Imperial Intermodal Ferry
Terminal in Weehawken, which is also on land owned by
Last year, the company bought more than a dozen new
vessels for $20 million with loans backed by the
In the coming months, Waterway will face competitors,
albeit small ones. Seastreak is considering adding
routes. And New York Water Taxi, financed by developer
Douglas Durst, is planning to start its service with
two boats in September. The company projects an
initial ridership of 200 people a day and hopes to
increase that figure to 1,000 next year when it plans
to add four more boats.
"Unfortunately we won't have had the benefit of
government support," said Water Taxi's Fox.
"We have applied for subsidies but there has been
no answer as of yet."