Congestion pricing in New York City cleared its final federal hurdle, all but ensuring that the first such program in the nation will begin next year in an effort to reduce traffic and pollution in Manhattan and fund improvements to mass transit.
The program would charge drivers a fee to enter Manhattan south of 60th Street with the aim of discouraging cars from squeezing into one of the world’s busiest commercial districts.
Final approval was granted by the Federal Highway Administration, a spokeswoman said Monday, and a local panel appointed by the Metropolitan Transportation Authority can now decide on final toll rates, including any discounts, exemptions and other allowances.
The M.T.A., which runs the city’s subways and buses and the metropolitan area’s commuter railroads and is overseeing the congestion pricing program, hasn’t set a fee scale yet. But a report that it released in August showed that one proposal under review would charge $23 for a rush-hour trip into Midtown and $17 during off-peak hours.
The authority says the tolling program could begin as soon as spring 2024.
Supporters of congestion pricing hailed the news of federal approval.
“It’s extremely important that we focus on meeting our climate goals and improving our air quality and especially improving our quality of life when it comes to our mobility,” said Renae Reynolds, the executive director of the Tri-State Transportation Campaign, a nonprofit dedicated to improving public transportation. “Congestion pricing is going to help us do that by clearing up clogged roads, by investing in mass transit.”
Congestion pricing, which New York lawmakers approved in 2019, is expected to generate $1 billion annually for the M.T.A.
The money will be used to improve the city’s public transit network, including by building new elevators in the subways and modernizing signals that keep trains moving. By law, the money can only be used to pay for capital projects, not operating costs.
Experts say the program would make getting around New York more equitable: It would levy a fee on drivers who can, at least in theory, afford to pay it, while helping those with less, since people who rely on mass transit tend to have lower incomes.
The plan is moving forward despite staunch opposition from taxi drivers, ride-share companies and suburbanites who do not want to pay to drive in Manhattan.
The most vociferous outcry has come from New Jersey leaders, who have cast congestion pricing as evidence of a border war and threatened legal action.
The state’s General Assembly, which is controlled by Democrats, passed a so-called Stay in Jersey bill, offering businesses grants to let employees work from their New Jersey homes. And the state’s Democratic governor, Philip D. Murphy, launched a billboard campaign criticizing the program.
Senator Robert Menendez and Representatives Josh Gottheimer and Bill Pascrell Jr., all New Jersey Democrats, said in a statement on Monday that they were “outraged” by the federal move, charging that officials had failed to conduct a full review of the environmental impact of the program in their state or its effect on low-income communities. “This is nothing more than a cash grab to fund the M.T.A.,” the statement said.
Other critics include taxi drivers and Lyft and Uber drivers who point to research by the M.T.A. showing that the tolls could trigger fare increases that could slash demand for taxis and for-hire rides by up to 17 percent.
Last week, a group of taxi and for-hire vehicle drivers staged a protest outside Gov. Kathy Hochul’s office and sent a letter demanding exemptions to the tolls.
“We ask you not to fund New York City’s public transportation system on the backs of an essential work force that is still underpaid, overworked and subject to assault and danger,” wrote Bhairavi Desai, the executive director of the New York Taxi Workers Alliance, which fights for better working conditions for taxi and app-based drivers.
To mitigate any potentially negative impact of congestion pricing, the M.T.A. has proposed limiting the number of times that drivers of taxis and for-hire vehicles can be tolled, giving certain low-income drivers a discount and increasing discounts for those driving into the area overnight. It has also proposed periodically checking on small businesses in the tolling zone to see if the tolls harm them.
The M.T.A. also intends to commit millions of dollars in investments to some neighborhoods that could end up with dirtier air from diverted traffic. That includes $20 million for a program to fight asthma and $10 million to install air filtration units in schools near highways.
Last month, the highway administration tentatively approved an updated draft of a report commissioned by the M.T.A. that had identified ways to mitigate the potential harm of congestion pricing on disadvantaged communities. That initial approval opened the draft to a 30-day public review before the final approval was granted.
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