NY Congestion Pricing Survived a Pause. Here’s What Could Kill It

(Bloomberg) -- New York’s plan to charge people driving on Manhattan’s traffic-clogged streets survived Governor Kathy Hochul’s five-month pause. Now a long-simmering legal challenge from New Jersey threatens to kill it.

Most Read from Bloomberg

Under the plan to ease congestion and pollution, starting on Jan. 5 most drivers will pay $9 to enter the tolling zone, which runs from 60th Street south to the tip of the island. The Metropolitan Transportation Authority on Monday approved the revised pricing, which Hochul reduced by 40% from $15 when she restarted the program last week.

But if a judge agrees with New Jersey Governor Phil Murphy that the plan must undergo additional federal environmental review, that would almost certainly push the start date into the administration of President-elect Donald Trump, who opposes congestion pricing. Trump, who is to be inaugurated on Jan. 20, could simply direct the Federal Highway Administration not to sign off on the revised program.

Trump, who was born and raised in the city and owns real estate in Manhattan, has called the toll a “massive business killer and tax on New Yorkers.” The plan, the first of its kind in the US, has spurred fierce opposition from some commuters and from New Jersey, which has called it a “brazen money grab.”

Battle on the Hudson

New Jersey sued the federal government last year, claiming it hadn’t done an adequate environmental review of the tolling program. Murphy claims the plan would increase congestion and pollution in his state on routes leading to bridges and tunnels — for example, by spurring some drivers to avoid the congestion tolling and use alternate routes like the George Washington Bridge or the Goethals Bridge.

The case has been ripe for a decision for months. During a two-day hearing in April, as the original June 30 start date approached, New Jersey urged Judge Leo M. Gordon to send the project back for further federal review. He hadn’t yet issued his decision when Hochul abruptly suspended congestion pricing weeks before it was set to begin.

On Tuesday, New Jersey filed a letter to Gordon nudging him to rule, saying the program’s new start date “only underscores the need for a decision here” and suggesting the state might seek an emergency order blocking the plan.