Feds Approve Congestion Pricing Plan for Manhattan

The Biden Administration is clearing the way for New York City to initiate a long-delayed congestion pricing plan that will charge motorists for entering Midtown Manhattan during peak traffic times, what will become the first active congestion pricing system in the US.

The Federal Highway Administration issued a letter approving the Metropolitan Transportation Authority (MTA) environmental assessment and issued a draft “Finding of No Significant Impact” that will become official in 30 days, Politico reported.

The MTA, which runs the NYC subway system, has been tasked with setting up the new tolling infrastructure for the congestion pricing regime, with a goal of launching the tolls in the second quarter of 2024.

The congestion pricing scheme—fares ranging from $9 to $23 for passenger vehicles and between $12 and $82 for trucks reportedly are under consideration by MTA—has the support of NY Gov. Kathy Hochul.

New York approved congestion pricing in 2019 as a means of raising $1B annually for the MTA’s capital plan. MTA said in a statement that congestion pricing revenue would “fund improvements to the public transit system.”

Across the Hudson River, New Jersey immediately put up its dukes over a plan that will impose a hefty new toll on NJ motorists who already are paying $16 to cross the river on the GWB or in the tunnels.

Calling the plan “unfair and ill-advised,” NJ Gov. Phil Murphy said the Garden State is assessing its legal options for opposing a plan the governor said will burden commuters, state agencies and the environment.

“Everyone in the region deserves access to more reliable mass transit but placing an unjustified financial burden on the backs of hardworking New Jersey commuters is wrong,” Murphy said, in a statement. “Simply put, it is a money grab.”

The Federal Highway Administration’s letter said an environmental assessment considered the impact of congestion pricing on a 28-county area in what the locals call the Tri-State Region—NY, NJ and CT—in its finding of no measurable impact.

Murphy’s opposition to the congestion pricing plan probably explains why the toll collection system will not be run by a bi-state entity that literally invented toll collection when it was run by Robert Moses.

The MTA, which has no experience setting up road tolls, is a curious choice for the collector of congestion pricing tolls—the Port Authority of New York & New Jersey has been the primary toll taker in the NYC metro area for nearly 70 years.

However, the Port Authority is jointly controlled by appointees of the governors of NY and NJ, so NJ would have a veto over the tolls if the Port Authority collects them.

MTA is struggling to collect its own subway fares. In March, MTA Chairman and CEO Janno Lieber told GlobeSt. the agency is hoping an increased police presence on subway platforms this year will help stem an epidemic of fare-beating that cost the system an estimated $400M in 2022.