Up-to-date York Gov. Kathy Hochul has halted a plan to charge drivers entering Manhattan, upending an initiative that has been years in the making and was set to finally launch at the end of this month.
The governor cited inflation and financial pressures on working-class Up-to-date Yorkers as his reason for not implementing congestion pricing, but the initiative proved to be a political albatross ahead of this year’s congressional elections.
“The decision is about doing what’s right for the people who keep our city blossoming,” she said Wednesday in a taped statement posted on the state’s website. “I need to focus on getting more money back into people’s pockets.”
Hochul will seek to replace the levy plan with a Up-to-date York corporate tax, according to a person familiar with the situation who asked not to be identified because the proposal has not been made public.
The up-to-date pricing system was scheduled to take effect on June 30 and would be the first of its kind in the US. The project was expected to generate $1 billion a year to modernize the more than 100-year-old transit system, which had been ravaged by weighty rains and severe flooding. The money was intended to fund subway signal upgrades to reduce train delays, up-to-date electric buses and an expansion of the Second Avenue subway to Harlem.
“It’s shocking,” said Andrew Albert, an MTA board member who voted for the congestion pricing. “It’s just unreal. The longer you wait, the more steep things become.
The move away from the tolling initiative is a stunning change for Hochul, who just two weeks ago touted the plan as a way to reduce empty traffic in the city. Virtually all of the overhead cranes are already installed on Manhattan streets and are ready to load drivers.
“It took a long time because people were afraid of the reaction from drivers who were getting in their way,” Hochul said at the time. “But as with housing, if we are sedate about making cities more livable, we have to come to terms with this.”
Unpopular policy
Hochul faced implementing unpopular policies that could hurt Democrats in key November congressional races. A Siena poll in April found that 63% of Up-to-date Yorkers disagreed with the plan, including majorities of Democrats, Republicans and independent voters. And although Hochul won’t run for re-election until 2026, her own approval ratings have suffered, with a May Siena poll showing her with 38-46% support among Up-to-date Yorkers.
In a statement, freshman Republican Rep. Mike Lawler, who represents a Hudson Valley swing district, sharply criticized Hochul’s decision as “nothing more than an election-year stunt.”
“Nearly five months before Election Day, Governor Hochul suddenly realized how bad congestion pricing was affecting poll prices in the suburbs and Up-to-date York City,” Lawler said.
“I am proud to say that we have eliminated congestion pricing,” said Up-to-date York Rep. Pat Ryan, a Democrat who represents parts of Up-to-date York City’s suburbs. “Now it’s time to get to work on a plan that actually makes sense for the entire state, not just Up-to-date York.”
Hochul’s decision to postpone was previously reported by Politico and the Up-to-date York Times. According to Politico, part of the consideration for the delay stems from concerns that implementing the bill will hurt Democrats in competitive House races this year. Hochul responded to concerns raised by House Minority Leader Representative and Up-to-date York Democrat Hakeem Jeffries, citing a person familiar with the matter, Politico also reported.
“To the extent immediate implementation of congestion pricing is reconsidered, Leader Jeffries supports a fleeting pause of confined duration to better understand the financial impact on working-class Up-to-date Yorkers who have faced a tough inflationary environment as a result of the pandemic.” said Andy Eichar, Jeffries’ spokesman. “We will continue to look for ways to lower costs for everyday Americans and strengthen mass transportation in Up-to-date York State.”
Transportation improvements
Former Mayor Michael Bloomberg introduced his congestion pricing plan in the mid-2000s with the same goal of reducing traffic and improving air quality in much of Manhattan. Bloomberg is the majority owner of Bloomberg LP, the parent company of Bloomberg News.
Transit advocates have spoken out against the delay because it will hold up critical infrastructure upgrades and harm the MTA’s ability to serve as an economic engine for the Up-to-date York area.
“Delaying the introduction of congestion pricing will only harm the millions of public transit riders who rely on the improvements and hinder the economic success of our broader region,” said Kate Slevin, executive vice president of the Regional Plan Association, a nonprofit that promotes initiatives for the region’s economy. “This move is a complete betrayal of Up-to-date Yorkers and our climate.”
The decision came after the federal judge overseeing Up-to-date Jersey’s lawsuit was expected to decide whether to halt the plan.
Up-to-date Jersey Gov. Phil Murphy thanked Hochul on Wednesday for pausing the rollout.
“We have always shared a shared vision of growing our regional economy, investing in infrastructure, protecting the environment and creating good-paying jobs on both sides of the Hudson River,” Murphy said in a statement.
Last year, state lawmakers raised the payroll tax on some Up-to-date York City businesses to lend a hand the MTA raise additional revenue as subway ridership had not yet reached pre-pandemic levels. Average weekday subway usage is approximately 70% of passengers in 2019.
It’s unclear whether an alternative fee would raise the same amount of money for the Metropolitan Transportation Authority, which runs Up-to-date York’s subways, buses and commuter rail lines. The plan was for the MTA to borrow against $1 billion in congestion pricing revenue to sell $15 billion in debt to pay for necessary infrastructure to improve service and attract more riders.
Delaying or canceling congestion pricing without another funding source would leave a huge gap in the MTA’s current multi-year capital plan. The nation’s largest transit carrier will also need up-to-date funding in the next 2025-2029 capital budget.
Hochul said the state has allocated funds to secure the agency’s capital plan and that officials are currently exploring other funding sources.