(Bloomberg) — The Trump administration is moving to block New York City’s congestion pricing program, reversing a federal approval granted last year and setting up a legal showdown over the tolling initiative.
The Federal Highway Administration plans to withdraw its agreement with the state-run Metropolitan Transportation Authority, which allowed the agency to impose tolls on drivers entering some of Manhattan’s busiest streets, US Transportation Secretary Sean Duffy said in a statement on Wednesday. The decision will likely halt the program, which began operating just last month.
“New York State’s congestion pricing plan is a slap in the face to working class Americans and small business owners,” Duffy said in a statement. “Every American should be able to access New York City regardless of their economic means. It shouldn’t be reserved for an elite few.”
The decision quickly sparked a legal challenge by the MTA, which sued the Trump administration in federal court on Wednesday, saying efforts to halt the program are illegal and seeking a judicial order declaring them “null and void.” The MTA said that the FHWA doesn’t have the legal authority to terminate an agreement that’s already been approved and implemented.
“Today, the MTA filed papers in federal court to ensure that the highly successful program – which has already dramatically reduced congestion, bringing reduced traffic and faster travel times, while increasing speeds for buses and emergency vehicles – will continue,” Janno Lieber, the MTA’s chief executive officer, said in a statement.
Lieber said the tolling program would remain in effect until there is a court decision on the matter.
The new charge of $9 for most drivers appears to be cutting traffic. There were 1.2 million fewer vehicles south of 60th street between Jan. 5 and Jan. 31, a 7.5% drop, according to the MTA. The travel time for the Holland Tunnel, which connects New Jersey to lower Manhattan, has been cut by nearly half.
Congestion pricing is expected to raise $15 billion to modernize subway signals from the 1930s, make more stations accessible and extend the Second Avenue subway to Harlem. Without that new revenue, the MTA and state lawmakers will need to find an alternative funding source or postpone vital infrastructure projects meant to improve mass-transit service and attract more riders.
New York Governor Kathy Hochul called public transit “the lifeblood of New York City” that is critical to its future, something she said President Donald Trump, a native New Yorker, knows very well. She accused the president of infringing on the state’s rights and acting like a monarch.
“We are a nation of states,” she said at a press briefing. “This is what we fought for. This is what Alexander Hamilton and others fought for, to set up a system. We are not subservient to a king or anyone else out of Washington.”
She added that “the commuters of our city and of our region are now the roadkill of Donald Trump’s revenge tour against New York.”
Duffy said he will terminate an agreement called a value pricing pilot program that the FHWA entered into with the MTA and New York officials on Nov. 21. That program allows US transportation agencies to reduce congestion on highways through tolling and other fees.
Roadways in Texas, Florida and California have used such agreements. Reversing MTA’s own pact with the FHWA could put other states’ deals at risk, Lieber said on Jan. 31 at an event in New York City.
“Even if you’re a conservative Republican from red state, that the idea that the federal government would summarily rescind agreements with states and localities — that has national implications,” Lieber said.
In his Wednesday letter to Hochul, Duffy cited concerns from New Jersey officials regarding the impact of the program on communities there. New Jersey, which sued the federal government in 2023, has said the plan would increase congestion and pollution in the state along routes that avoid the central business district in Manhattan, such as towns near the George Washington Bridge.
“While I have consistently expressed openness to a form of congestion pricing that meaningfully protects the environment and does not unfairly burden hardworking New Jersey commuters, the current program lines the MTA’s pockets at the expense of New Jerseyans,” Governor Phil Murphy said in a statement after Duffy’s letter was released.
In his argument to revoke the federal sign-off, Duffy said he doesn’t believe Congress had authorized the program, saying that the “FHWA has never before approved” a “program that uses cordon pricing or that does not provide a toll-free option.”
‘Laughable’ Decision
Riders Alliance, which advocates for more reliable and affordable mass transit in New York City, took legal action last year to advance the tolling program after Hochul temporarily paused it in June.
“Public transit riders won congestion relief and are now enjoying faster and more reliable bus service from throughout New York and New Jersey,” Betsy Plum, executive director of Riders Alliance, said in a statement. “We are committed to maintaining and expanding on our victory and will defend it with everything we have.”
Democrat New York Represenative Jerrold Nadler called the arguments defending the revocation “laughable.” He represents parts of Manhattan.
“The notion of revoking approval for a federal initiative of this magnitude is nearly without precedent,” he said in a statement. “I firmly believe that there is no legal basis for the President to unilaterally halt this program.”
The toll began on Jan. 5, with E-ZPass passenger cars paying $9 during peak hours to drive south of 60th Street, with the West Side Highway and the FDR Drive exempt from the charge. State lawmakers approved the initiative in 2019 to reduce traffic in one of the most congested urban areas in the world, improve air quality and offer the MTA another funding source for infrastructure investment.
The union representing New York City’s firefighters hailed the move kill the program, saying it posed a “serious financial burden” on its members who drive into the city.
“Many of our members live in the outer boroughs and beyond, and they rely on their personal vehicles to get to their firehouses, and often must use their personal vehicle to go to another firehouse with their gear, forcing them to pay additional fees that no other NYC employee had to bear,” Andrew Ansbro, president of the FDNY Uniformed Firefighters Association, said in a statement.
–With assistance from Skylar Woodhouse, Sri Taylor, Myles Miller, Laura Nahmias and Max Rivera.
(Updates with new comment from Governor Hochul in 10th paragraph and from firefighters union in final paragraph)
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