Come January, most drivers will pay $9 to enter the heart of Manhattan, after New York City was granted federal approval for a tolling plan, decades in the making, that will be the first of its kind in the nation.
New York will now join a small club of global capitals around the world that includes London, Stockholm and Singapore that have installed similar tolling restrictions around their gridlocked centers and seen traffic and air quality improved.
But even as long-suffering supporters of congestion pricing celebrate, the tolling plan could still be upended. The program is in jeopardy of being blocked by a volley of lawsuits and an incoming president who has called it “the most regressive tax known to womankind.”
A central goal of the program is to raise $15 billion in financing for the Metropolitan Transportation Authority to pay for the modernizing of the city’s mass transit system. The busiest transit system on the continent still depends on some equipment that dates back to before World War II and needs billions of dollars to install elevators and escalators, repair crumbling tracks and improve service, among other improvements.
To make the unpopular plan more palatable, Gov. Kathy Hochul has reduced the costs of the tolls, after first placing congestion pricing in limbo with a pause just weeks before its original start date in June.
Ms. Hochul said that she was concerned that the plan would be too much of an economic burden for New Yorkers. Some critics of the governor, however, questioned whether the suspension was also meant to shield Democrats at the ballot box from any possible fallout from the start of the plan.
Earlier this month Ms. Hochul announced a 40 percent reduction in the tolls, lowering the peak period fee for most drivers from $15 to $9.
Now, however, there are questions about whether the toll reductions have won congestion pricing any more support among New Yorkers and if the more modest fees will allow the M.T.A. to reach its funding goals. The revised plan, set to start Jan. 5, is expected to generate hundreds of millions less than the initial proposal, drawing questions about how the authority will still get the money it needs.
A Siena College survey conducted in April revealed that about two-thirds of New York State residents said they opposed the program.
On Friday, the Federal Highway Administration gave the final approval to Ms. Hochul’s version of the plan and pushed it past its last bureaucratic hurdle.
“This is an exciting moment,” said Janno Lieber, the chief executive of the M.T.A., which will implement the plan. “Everybody knows this has been a long journey getting to this point.”
Under the latest plan, transit officials will gradually raise the fee to the original price, bringing it up to $12 after three years, and then to $15 by 2031. The first plan was projected to yield roughly $1 billion annually. The new plan would generate only about $500 million per year during its first three years, according to transit officials.
Officials in the governor’s office and the M.T.A. have said that the revised plan will still allow the transit agency to leverage the toll revenue as backing for $15 billion in bonds. Some finance experts have cautioned, however, that the authority, which has a history of grappling with surging debt, may see its borrowing costs rise as it tinkers with the financing terms.
“Public transit riders are one big step closer to more reliable trains, accessible stations and faster buses,” said Danny Pearlstein, a spokesman for Riders Alliance. “After years of campaigning and holding our leaders accountable, relief cannot come soon enough.”
Public officials are now racing to complete its comeback before its most powerful detractor takes office.
President-elect Donald J. Trump is opposed to the tolling plan, saying that the added cost of the tolls could keep tourists from Manhattan and hurt businesses. He has vowed to undo the plan as one of his first acts in office, though his options are limited now that the federal government has signed off.
Even with the lower rates, the program has been highly unpopular in the New York City area. At least nine lawsuits threaten the plan, and a group of opponents escalated its efforts last week by requesting an injunction to block it from advancing.
“This new congestion pricing plan is still bad for the economy, will still cause supply chain disruptions and will still raise the price of goods upon which households across the five boroughs and its surrounding suburbs rely,” Kendra Hems, the president of the Trucking Association of New York, said in a prepared statement. “The Trucking Association of New York will continue using every tool at our disposal to fight this plan.”
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