Gov. Kathy Hochul of New York announced on Wednesday that she was shelving the long-awaited tolling scheme known as congestion pricing, just weeks before it was to go into effect.
“After careful consideration I have come to the difficult decision that implementing the planned congestion pricing system risks too many unintended consequences,” Ms. Hochul said, adding: “I have directed the M.T.A. to indefinitely pause the program.”
The decision, Ms. Hochul said, was not an easy one, but nonetheless crucial in light of the lingering effects of the coronavirus pandemic on working families and New York City’s economy.
The congestion pricing plan, the first of its kind in the nation and a program that has been decades in the making, was slated to start June 30. Drivers using E-ZPass would have paid as much as $15 to enter Manhattan south of 60th Street.
The governor said she feared that instituting a toll to drive into the borough would “create another obstacle to our economic recovery.”
“Let’s be real: A $15 charge may not seem like a lot to someone who has the means but it can break the budget of a hard-working middle-class household,” Ms. Hochul said.
Word of the governor’s last-minute misgivings began to circulate in Albany on Tuesday night, and quickly sent shock waves through the New York State Capitol by Wednesday morning, the penultimate day of the legislative session.
Few could say that they loved congestion pricing — a politically unattractive proposal championed by both economists and environmentalists as the solution not only to the financial woes of the Metropolitan Transportation Authority, the state agency that runs New York’s subway and buses, but also the city’s infamous gridlock.
But after decades of debate, hearings, studies and planning, most Democrats had made a grudging peace with the plan — none more publicly than Ms. Hochul, who has defended it as a necessary step toward rebuilding New York’s economy.
Just two weeks ago, the governor told attendees at the Global Economic Summit in Ireland that implementing congestion pricing was critical to “making cities more livable.”
“I’m very upset that suddenly, out of the blue, this would pop up,” Senator Liz Krueger, a Manhattan Democrat said on Wednesday, adding: “If we stop congestion pricing now we’re never going to get it.”
Kate Slavin of the Regional Plan Association, a nonprofit urban research and advocacy group that has championed the tolling program, called the move “a total betrayal of New Yorkers and our climate.”
But even as transit advocates decried the move, an undercurrent of support was stirring among lawmakers, particularly those representing purple districts.
“Many see it as welcome news,” James Skoufis, a Democrat who represents Orange County in the State Senate said, adding that despite the plan’s approval five years earlier, opposition had been growing in the Legislature. “Some of it is outspoken, some of it is quieter, but it is widespread.”
In her address, Ms. Hochul stressed her commitment to public transit, and ensuring that the transportation authority had the funding it needed to complete long overdue capital projects. But she said that the city’s outlook had changed since the plan was approved in 2019. “Workers were in the office five days a week, crime was at record lows and tourism was at record highs,” she said. “Circumstances have changed and we must respond to the facts on the ground.”
Ms. Hochul needs only the approval of the authority’s board to halt implementation of the plan. But without the projected $1 billion a year for the city’s buses and subways, the transit system would soon fall into crisis.
Ms. Hochul could fill that gap, at least temporarily, with money from the state reserves. But she is also said to be looking at a more durable revenue source, in the form of a tax on city businesses, which would require the approval of the State Legislature.
Reporting was contributed by Nicholas Fandos, Jeffery C. Mays and Claire Fahy.