Gov. Kathy Hochul is quietly maneuvering to delay a plan to toll drivers entering Manhattan’s central business district, just weeks before it is slated to go into effect, according to two people familiar with the discussions.
The first-in-the-nation congestion pricing plan, which has been decades in the making, was slated to start June 30. Drivers using E-ZPass would have paid as much as $15 an hour to enter Manhattan south of 60th Street.
But even as Ms. Hochul believes that congestion pricing is good environmental policy, she has concerns that the timing was less than ideal, according to a person familiar with her thinking. The governor feared that it might deter commuters from returning to the central business district, which has yet to fully recover from the pandemic.
It is not clear whether Ms. Hochul’s still-formative plan to delay congestion pricing and replace it with another revenue stream would gain the needed approval of the New York State Legislature, which passed the plan years ago.
Ms. Hochul’s gambit, if successful, would be a devastating blow to advocates and organizers who have worked for more than a decade to bring this change to New York City.
The tolling scheme was designed to reduce traffic congestion in Manhattan and produce $1 billion a year in revenue for the Metropolitan Transportation Authority, which runs the region’s subways, buses and two of its commuter rail systems. That revenue, in turn, would fund the system’s vast capital construction needs.
To fill the $1 billion yearly gap, Ms. Hochul is considering proposing a tax on New York City businesses. Such a tax would require the approval of the Legislature, which is far from assured, especially with just two days left in the legislative session.
If congestion pricing were to go into effect, it would be borne heavily by drivers from New York City, Connecticut, New Jersey and surrounding counties. A business tax would fall largely on New York City. But shifting the tax burden from drivers to business could also carry some populist appeal ahead of the general election.
The plan to charge drivers to enter Manhattan’s central business district has sparked fierce opposition from unions, drivers, Gov. Phil Murphy of New Jersey, former President Donald J. Trump and New York City suburbanites during an election year when several suburban congressional seats are at stake.
Other major cities around the world, including Stockholm, London and Singapore, have for years charged tolls to enter central business districts, and transportation experts have long cherished hopes that New York City would join their ranks.
Former Mayor Michael R. Bloomberg made a serious bid to convince Albany legislators to pass a congestion pricing plan for New York City, but ultimately failed. It was only after the transit system’s so-called “summer of hell” in 2017 that the plan gained traction, with then-subways chief Andy Byford championing the effort, and then-Gov. Andrew M. Cuomo belatedly embracing the idea.
In the ensuing years, the pandemic ravaged Manhattan’s central business district, and Mr. Cuomo has begun to publicly question the wisdom of congestion pricing. Mayor Eric Adams has offered the plan only tepid support.
“Pumping the brakes on congestion pricing would be a massive betrayal of several million public transit riders,” said Danny Pearlstein, the policy and communications director at Riders Alliance, which has spent years pushing for congestion pricing. “It would also mean taking cues from the likes of Phil Murphy, Andrew Cuomo and Donald Trump.”