New York Governor Kathy Hochul just announced that she’s putting congestion pricing on pause. The plan had gone through years of political and regulatory hell and finally passed the state legislature earlier this year, to go into effect on June 30th, in 25 days. There was some political criticism of it, and lawsuits by New Jersey, but all the expectations were that it would go into effect on schedule. Today, without prior warning, Hochul announced that she’s looking to pause the program, and then confirmed it was on hold. The future of the program is uncertain; activists across the region are mobilizing for a last-ditch effort, as are suppliers like Alstom. The future of the required $1 billion a year in congestion pricing revenue is uncertain as well, and Hochul floated a plan to instead raise taxes on businesses, which is not at all popular and very unlikely to happen.
So last-minute is the announcement that, as Clayton Guse points out, the MTA has already contracted with a firm to provide the digital and physical infrastructure for toll collection, for $507 million. If congestion pricing is canceled as the governor plans, the contract will need to be rescinded, cementing the MTA’s reputation as a nightmare client that nobody should want to work with unless they get paid in advance and with a risk premium. Much of the hardware is already in place, hardly a sign of long-term commitment not to enact congestion pricing.
Area advocates are generally livid. As it is, there are questions about whether it’s even legal for Hochul to do so – technically, only the MTA board can decide this. But then the governor appoints the MTA board, and the appointments are political. Eric is even asking about federal funding for Second Avenue Subway, since the MTA is relying on congestion pricing for its future capital plans.
The one local activist I know who opposes congestion pricing says “I wish” and “they’ll restart it the day after November elections.” If it’s a play for low-trust voters who drive and think the additional revenue for the MTA, by law at least $1 billion a year, will all be wasted, it’s not helping. The political analysts I’m seeing from within the transit advocacy community are portraying it as an unforced error, making Hochul look incompetent and waffling, rather than boldly blocking something that’s adverse to key groups of voters.
The issue here isn’t exactly that if Hochul sticks to her plan to cancel congestion pricing, there will not be congestion pricing in New York. Paris and Berlin don’t have congestion pricing either. In Paris, Anne Hidalgo is open about her antipathy to market-based solutions like congestion pricing, and prefers to reduce car traffic through taking away space from cars to give to public transportation, pedestrians, and cyclists. People who don’t like it are free to vote for more liberal (in the European sense) candidates. In Berlin, similarly, the Greens support congestion pricing (“City-Maut”), but the other parties on the left do not, and certainly not the pro-car parties on the right. If the Greens got more votes and had a stronger bargaining position in coalition negotiations, it might happen, and anyone who cares in either direction knows how to vote on this matter. In New York, there has never been such a political campaign. Rather, the machinations that led Hochul to do this, which people are speculating involve suburban representatives who feel politically vulnerable, have been entirely behind the scenes. There’s no transparency, and no commitment to providing people who are not political insiders with consistent policy that they can use to make personal, social, or business plans around.
Everything right now is speculation, precisely because there’s neither transparency nor certainty in state-level governance. Greg Shill is talking about this in the context of suburban members of the informal coalition of Democratic voters; but then it has to be informal, because were it formal, suburban politicians could have demanded and gotten disproportionately suburb-favoring public transit investments. Ben Kabak is saying that it was House Minority Leader Hakeem Jeffries who pressed Hochul for this; Jeffries himself said he supports the pause for further study (there was a 4,000 page study already).
The chaos of this process is what plays to the impression that the state can’t govern itself; Indignity mentions it alongside basic governance problems in the city and the state. This is how the governor is convincing anti-congestion pricing cynics that it will be back in November and pro-congestion pricing ones that it’s dead, the exact opposite of what she should be doing. Indecision is not popular with voters, and if Hochul doesn’t understand that, it makes it easy to understand why she won New York in 2022 by only 6.4%, a state that in a neutral environment like 2022 the Democrats usually win by 20%.
But it’s not about Hochul personally. Hochul is a piece of paper with “Democrat” written on it; the question is what process led to her elevation for governor, an office with dictatorial powers over policy as long as state agencies like the MTA are involved. This needs to be understood as the usual democratic deficit. Hochul acts like this because this signals to insiders that they are valued, as the only people capable of interpreting whatever is going on in state politics (or city politics – mayoral machinations are if anything worse). Transparency democratizes information, and what Hochul is doing right now does the exact opposite, in a game where everyone wins except the voters and the great majority of interests who are not political insiders.