Feds sign off on New York City’s latest congestion pricing plan

New York City has received a green light from the Biden administration to implement a retooled congestion pricing program, but the plan still faces lawsuits from opponents and anticipated pushback from incoming President-elect Donald Trump.

Last Thursday, the Federal Highway Administration approved the Metropolitan Transportation Authority's plan, which Gov. Kathy Hochul resurrected earlier this month with a reduced base fare of $9 – down from the original plan of $15. The program will go into effect on Jan. 5, just days before Trump takes over the presidency.

"We are pleased to have received formal approval from the Federal Highway Administration for the phase-in feature of the Central Business District Tolling Program,” Catherine Sheridan, president of MTA Bridges and Tunnels/Triborough Bridge and Tunnel Authority, said in a statement.

The controversial tolling program, which was originally set to start June 30, called for a $15 toll on drivers entering the core of Manhattan to generate about $1 billion annually for public transit system upgrades.

But in June, Hochul abruptly hit the brakes on congestion pricing, announcing that she directed the MTA to "indefinitely" pause the program. She cited the impact on commuters who would be forced to pay higher tolls.

To be sure, the new congestion pricing tolls will eventually increase to the original $15 by 2031, according to the Hochul administration.

The MTA said the plan includes discounts for low-income drivers making less than $50,000 annually. These drivers will receive a 50% discount after hitting their 10th toll each month.

Meanwhile, the plan faces an uncertain future with several lawsuits, including one filed by New Jersey Gov. Phil Murphy and another by the New York Trucking Association, challenging the higher tolling system in state and federal court.

"While political leadership is now saying the right things about bringing down the cost of living in the state, New Yorkers should not be fooled by the rhetoric: this new congestion pricing plan is still bad for the economy, will still cause supply chain disruptions, and will still raise the price of goods upon which households across the five boroughs and its surrounding suburbs rely," Kendra Hems, the Trucking Association's president, said in a statement.

Trump, a Republican and native New Yorker, has pledged to "terminate" the program when he takes over the White House in January. Trump's pick to head the U.S. Environmental Protection Agency, former New York congressman Lee Zelden, railed against congestion pricing during his 2022 gubernatorial run.