Motorists who use E-ZPass are being tracked on streets that are not tolled. The New York Civil Liberties Union revealed the program last week after receiving documents from New York City, New York's transportation department describing the $5 million federally funded surveillance program.

"The New York City Department of Transportation (NYCDOT) is seeking to identify and observe trends in travel time congested areas of the city," a 2012 city proposal explained. "As part of the study, the NYCDOT is planning to install radio frequency identification (RFID) tag readers and license plate recognition (LPR) cameras and associated equipment at intersections in Midtown Manhattan. The RFID tag readers will read electronic toll collection system tags mounted on vehicles as they pass through an intersection and the LPR cameras will process license plate readings as the vehicles pass through the field of view of the camera."

As of last year, at least 149 E-ZPass readers were actively "studying" the travel patterns of motorists who have a toll transponder on their vehicle. The system, dubbed Midtown in Motion, is meant to monitor traffic flow and dynamically change signal timing to reduce traffic snarls by a claimed ten percent.

"Depending on the traffic situation, traffic lights can be adjusted to provide a more even distribution of traffic entering Midtown so that already congested areas do not become oversaturated, or priority can be given to clearing isolated backups resulting from breakdowns, fender-benders or double-parked vehicles," a 2011 city news release explained. "The system lets engineers use the more effective pattern based on measured traffic conditions."

The city claims E-ZPass identity information is not retained because the system uses the E-ZPass "transmit" protocol which "scrambles" the identity of the tag.

"Transcom's system for managing incidents and traffic (Transmit) utilizes readers installed along the roadway for traffic management and surveillance applications," the program's manual explained. "Using vehicle-mounted E-ZPass tags, travel time and average speed information on instrumented sections of the roadways is obtained. The information is transmitted to Transcom via a local server, where it is encrypted and processed. Once the data is encrypted, the privacy of the customer is protected."

The New York branch of the ACLU is not convinced that enough steps are being taken to protect driver privacy. The organization found law enforcement requesting E-ZPass records from the city on multiple occasions.

"A traffic study is a laudable project, but adopting technology that allows for mass collection of individual vehicle trip time data is concerning when there are no appropriate privacy protections," the NYCLU warned.