New Jersey Sues Over Manhattan Congestion Pricing

New Jersey has filed a federal lawsuit aimed at blocking New York’s plan to impose congestion pricing—a.k.a. tolls as high as $23 a day on commuters driving into the lower third of Manhattan south of 60^th Street.

The congestion tolls got a final approval last month from the Federal Highway Administration (FHWA), which certified that the plan will not cause any negative environmental impact.

Under what will be known as the Central Business District Tolling Program, which will be run by the Metropolitan Transportation Authority (MTA), drivers entering the bottom third of Manhattan—everything below Central Park down to Battery Park, excluding the highways—will be hit with tolls as much as $23 a day.

The MTA hasn’t finalized the exact amount but says the electronic toll scanners it has put up on 60^th Street also will charge you if you drive into the congestion zone in the middle of the night—albeit at a discounted rate of $5. Bridge and tunnel tolls to cross the Hudson—now $17—will be applied to the congestion toll, according to a report in Fast Company.

The NY Legislature in 2019 passed a law ordering the MTA to create the congestion pricing scheme to raise at least $1B per year to fund NYC’s transit system. The plan is scheduled to go into effect in Q2 2024.

NJ’s lawsuit, which was filed in federal court in Newark on Friday—and names the FHWA and the US Department of Transportation as defendants—is challenging the environmental assessment conducted by FHWA, claiming it failed to take into account the impact congestion pricing may have in Fort Lee, Weehawken and Jersey City near the entrances to the George Washington Bridge, the Lincoln Tunnel and the Holland Tunnel, respectively.

The assessment “buried the reality that while Manhattan’s air quality may improve, New Jersey’s air quality will deteriorate as traffic and pollutants shift,” the lawsuit alleges.

“We’ll bear the burdens of congestion pricing while New York City gets the benefits, and that’s not fair,” Gov. Phil Murphy said at a press conference announcing the lawsuit. Appearing beside Murphy, US Sen. Bob Menendez called the congestion pricing plan a “brazen money grab” and “highway robbery.”

“It’s anti-middle class, anti-small business, anti-common sense for communities that call this side of the Hudson home,” Menendez said.

However, despite the environmental argument in the lawsuit, NJ’s governor flashed a big signal that he might be okay with some form of congestion pricing—if the Garden State gets a piece of the revenue pie from the new tolls.

Murphy said he’s open to the “idea” of congestion pricing but said the goal of the current plan is simply to raise revenue for the MTA and its $51B capital improvement plan.

The MTA, which runs NYC’s subways and buses, called the lawsuit “baseless.”

“Contrary to any claim that there was insufficient study, the [environmental assessment] actually covered every conceivable potential traffic, air quality, social and economic effect, and also reviewed and responded to more than 80,000 comments and submissions,” John McCarthy, MTA’s chief of external relations, said in a statement.

Gov. Kathy Hochul said at a press conference on Friday that the region needs congestion pricing to reduce gridlock in Midtown Manhattan and support vital transit infrastructure. The MTA estimates that an average of 143,000 vehicles carrying workers to their jobs come into the Central Business District zone each day.

New York put the new congestion tolls under the responsibility of the MTA despite the fact that the subway system lost more than $500M to fare-beating last year. If the Empire State put the new tolls under the auspices of the Port Authority, which collects tolls at the river crossings, the state would have had to share the proceeds with NJ.

Without much fanfare, the MTA disclosed this week that it is deploying an AI system at a limited number of subway stations in a pilot program to combat fare-beating by identifying the turnstile jumpers, presumably by deploying a facial-recognition system.

In March, MTA CEO Janna Lieber told GlobeSt. that NYC’s subway system is projected to run budget deficits for the foreseeable future due to decreased ridership caused by the widespread adoption of hybrid work patterns.

“Compared to pre-COVID, it’s now about 75% [of what it was]. Our projections are the low 80s in a couple of years, but we’ll still be stuck at 20% less than what we used to be,” Lieber told us.

Staten Island Borough President Vito Fossella told the NY Post on Saturday that the borough will mount its own legal challenge to congestion pricing if the Garden State’s efforts to block the new tolls fails.