Will congestion pricing take the shine off the Big Apple?

Photos: Jeff Zorabedian

A controversial plan to charge hefty tolls to motor vehicles driving south of 60th Street in Manhattan has finally gone into effect. Will congestion pricing take the shine off the Big Apple?

Manhattan’s streets retained much of their energy even after the Covid shutdowns and the rioting and lawlessness of 2020. But a much-discussed and long-delayed plan that took effect on January 5 to charge cars $9 to enter the city south of 60th Street could finally change all that.

The plan, called “congestion pricing,” has faced withering public skepticism. Polls show that most New Yorkers don’t support it, with many viewing it as an underhanded scheme to subsidize the chronically insolvent Metropolitan Transit Authority (MTA), responsible for the city’s public transportation.

Congestion pricing advocates claim the charge will reduce traffic and emissions while funding better transportation infrastructure, making the charge a fair price to pay for a more pleasant city.

Similar plans have been tried in a few cities around the world, with mixed results. New York is the first American city to try it. The question now is whether the plan will live up to the hopes of its advocates, or make the Big Apple less inviting at a moment when it is struggling to restore its shine.

Diamonds in the Rough

While New York’s Diamond District has lost some of its luster, the section of 47th Street between 5th and 6th Avenues remains an important hub of the jewelry industry, and still draws a significant number of Israelis, Russian-speaking Jews, and a cadre from Boro Park and Williamsburg.

Because the district is located squarely within the “congestion zone” and mainly employs commuters from outside the area, it is as good a sounding board as any for attitudes toward congestion pricing.

“I think it’s ridiculous,” fumes Aron, who travels daily from New Jersey to operate a station in one of 47th Street’s many jewelry markets. “They’re just trying to figure out how to rip us off more and take more money. It makes no sense.”

Perched behind his counter in a busy open room with a few dozen other sellers, Aron speaks for roughly two-thirds of those surveyed by this writer for opinions on the congestion charge. Most see it as an unfair tax, unlikely to deliver positive results. That breakdown roughly mirrors the plan’s standing in citywide polling.

“It won’t make things any easier,” he adds. “There’s still going to be traffic, it’s not going to work like that.”

Like other 47th Street opponents, however, Aron is not concerned that the plan will increase the cost of merchandise, which is mostly shipped, or change the travel habits of his customers, few of whom come to the city by car.

Yossi, who sells his wares in a different exchange, drives every day into the district from his home in Queens. Like the sizable minority of other optimists, he’s hopeful the charge will make his trek easier.

“If there will be less traffic, I’m happy with it,” says Yossi. “Maybe it will encourage more drivers to take two or three people in a car.”

A Real Pickle

Manhattan’s Lower East Side still retains a hearty remnant of the Jewish population that defined the neighborhood’s character for well over a century. The Pickle Guys, perhaps the last of its once numerous pickle shops, is a wooden-barrel-lined throwback at the corner of Essex and Grand Streets, greeting customers with an aroma that leaves no mystery to its product.

Proprietor Alan Kaufman commutes daily from Howard Beach in southeastern Queens, and he’s not happy with the prospect of an additional fee to get to work.

“I’m against it,” he says from behind the counter. “It’s just another way of taxing us and helping the MTA waste more money.”

Mr. Kaufman echoes the fears of many small business owners that customers from outside the area will be hesitant to add $9 to their transportation costs, on top of already hefty tolls and parking expenses. He also fears that over time, the cost of raw materials will go up. Large trucks are currently charged $21.60, and smaller trucks pay $14.40.

“All the trucks will charge more,” he predicts. “If I were a trucker, I would pass on the congestion pricing too.”

Nestled between rows of Chinese-owned businesses on East Broadway is Mesivta Tiferes Yerushalayim (MTJ). The oasis of Torah within its time-worn walls reminds visitors that there are issues more sublime and enduring than whether it will cost an extra $9 to reach the yeshivah.

Still, even for the eclectic mix of seasoned Torah scholars and colorful characters in this refuge from the mundane, there is no immunity from the impacts of congestion pricing. A pair of chavrusas discuss the charge as they break for Minchah.

“Yeah, hopefully they’ll be mevatel it,” says one.

Yaakov Ehrenreich rides the subway each day to MTJ from Boro Park, so he’s not subject to the congestion charge. Nevertheless, he’s decidedly against it, calling it a “nuisance.” And he highlights one aspect of the plan that has come in for sharp public criticism: Residents of the congestion zone get no exemption.

“It’s rishus for the people who live here on the Lower East Side,” Ehrenreich says. “Every time they have to go shopping, it’ll cost them $9 extra.”

The public outcry over this feature of the congestion pricing compelled some progressive elected officials from the affected areas to protest that their constituents should be exempt. But those appeals were turned down, leaving lower Manhattan residents to pay when returning home by car.

“Nobody drives in Mahattan for joy,” says Michael, a Lower East Side resident in an MTJ hallway. “It’s not going to affect Donald Trump or Elon Musk, but it’ll affect middle-class people who have to drive somewhere.”

Yonason, a professor in Washington Heights spending his winter break learning at MTJ, agrees that people living in the congestion zone should be exempt, but he sees merits to the plan.

“Overall, it’s a good thing,” he says. “I think the goal of less traffic in Manhattan and supporting public transportation is good for everyone.”

Treacherous Road

No one alive remembers a time when Manhattan traffic was not a problem, and various officials proposed reducing it through toll schemes dating back to the 1960s. Mayor Michael Bloomberg proposed a congestion pricing plan in 2007, but it failed to gain support in the state legislature.

As critics emphasize, congestion pricing’s present inception has little to do with clearing the air or the streets. By 2017, the MTA was running a $1 billion yearly operating deficit with no natural path toward solvency. There was no more room in the state budget for an increased subsidy, so that left policy makers looking for a new revenue source.

“[The MTA] takes pieces of a lot of taxes… but there wasn’t much more for them to tap,” says Nicole Gelinas, an expert in urban economics at the Manhattan Institute who has written extensively about congestion pricing. “This was the last thing they wanted to do, since people would feel this cost.”

Ms. Gelinas said it took the “Machiavellian legislative skills” of former New York governor Andew Cuomo to make congestion pricing into law. Realizing few politicians wanted to be on record for supporting the plan, in 2019, he sank it deep into the state’s budget bill and delayed implementation for a few years, thereby offering cover for elected officials. The plan’s stated goal was to raise $1 billion in additional annual funding for the MTA.

That plan underwent several reviews by an MTA board, which eventually opted to charge peak-hour rates of $15 for  cars and $24 or $36 for trucks, depending on size. Congestion pricing was set to go into effect this past summer, when suddenly Governor Kathy Hochul, who had been one of the plan’s vocal advocates, indefinitely paused its implementation.

The governor said the pause was motivated by the impact of inflation and the city’s yet-incomplete post-Covid recovery. But few observers doubted reports that the pause was an acquiescence to a request from House Democratic leader Hakeem Jeffries, who feared congestion pricing would hurt his party’s candidates in the upcoming elections.

Any doubts of that were erased when, a few weeks after Election Day, Governor Hochul put the plan back on track for 2025. Her moves only bolstered congestion pricing’s critics.

“She put this out there and then pulled it before elections, then it was back afterwards,” says a Brooklyn resident who drives daily to lower Manhattan. “Obviously, [the Governor] doesn’t feel people would take this on its own merits. She herself doesn’t think people will like it.”

Critics have called for a number of changes to more effectively reduce traffic — rather than maximize revenues for the MTA. The most prominent of these was to eliminate the fee during nighttime hours. Although the final plan maintains the nighttime fee, it does charge lower rates at off-peak hours; between 9 p.m. and 5 a.m., the charge for cars drops to $2.25. (Congestion pricing programs in London, Stockholm, and Singapore charge no overnight fees.)

The plan also offers partial rebates for low-income drivers and those already paying tolls to cross directly into the congestion zone. Cars that cross to Manhattan but remain on the two highways that bracket Manhattan — FDR Drive and the West Side Highway — will not be charged. Rates are scheduled to be gradually raised over the coming years.

“It always would have made sense to start with a cheaper program, but the way the law was written, it forced the MTA to raise a billion dollars a year,” says Ms. Gelinas. “That put revenue first and [alleviation of] congestion second. Still, it’s better than it was.”

No Alternative Route

Congestion pricing supporters say the plan’s unpopularity is mainly due to resistance to change. They are hopeful that once the benefits are felt, public opinion will shift.

“It’s a big step for the city,” says Rachel Weinberger, director of regional strategy at the Regional Plan Association which advocated for congestion pricing. “People will have a hard time in the beginning, but we think they’ll look back, see it’s good for them, and come to embrace it.”

Dr. Weinberger says New York has exhausted other traffic mitigation options and that progress now depends on making it less appealing to drive through its busiest area.

“The only way to get congestion reduced is if there are fewer cars on the road,” she says.

Congestion pricing has only been tried in a few cities around the world — most prominently London, where results were mixed. Over its first year in 2003, traffic dropped 18 percent and congestion within the zone fell 30 percent. Yet by 2022, INRIX, an organization that analyses traffic data, rated London the world’s most congested city.

Dr. Weinberger said that London’s results are not an indictment of congestion pricing.

“How do you measure traffic?” she asks. “In London, there might be more vehicle traffic now, but they’ve also added more bus lanes and made productivity higher. If you look at the whole transportation system, it’s moving more quickly than before.”

Wrong Way

While congestion pricing advocates hope its success will win it wider popularity, the revenue-driven nature of the plan, and the fact that its key purpose is to fund the MTA, make selling it an uphill battle. Assemblyman Kalman Yeger (D-Brooklyn) ins’t buying.

“This is and has always been a cash grab, with zero to do with congestion,” he says. “The proof is that there’s a charge at two in the morning, when no one’s on the road.”

Critics also say the MTA has other ways to refill it coffers.

The lowest hanging fruit is an estimated $700 million in lost annual revenues from fare evasion — a problem that has only mushroomed as the city’s progressive justice system moved away from prosecuting turnstile hoppers. (The comparable figure prior to 2020 was estimated to be $300 million.)

“[Congestion pricing] was the lazy way out,” says Mr. Yeger. “You have the same woke politicians who put up resistance whenever anybody said we should prosecute subway fare evaders now saying we have to enforce the rules for cars driving into the city. This was a way to make that class of politicians happy.”

The MTA spends $1.1 billion on overtime, due largely to poor management and work rules. Labor laws and the MTA’s own internal guidelines require it to contract exclusively with unionized construction workers, and to pay the state’s “prevailing wage,” a minimum of $99 per hour.

“The starting point of this plan is that people know they can’t trust the MTA to spend money wisely or ethically,” says Mr. Yeger. “Whenever they need cash, their first move is to go get it from the taxpayer.”

Diverse Discontents

Advocates and opponents of congestion pricing don’t always fit neatly into pre-existing political categories. Elected officials in both parties who represent suburban areas have decried congestion pricing. But over the past year, New York’s plan has drawn lawsuits from opposition as diverse as the NAACP, the state’s teachers union, civic groups, Rockland County, a trucker organization, Republican state legislators, and the state of New Jersey.

New Jersey officials are among congestion pricing’s most outspoken opponents. Democratic governor Phil Murphy labels it a “double tax” on commuting constituents, who already pay steep tolls to cross the Hudson River. About 20 percentof drivers in the zone come from New Jersey. While the plan gives $3 rebates to those entering through the Lincoln, Holland, or Brooklyn-Battery tunnels, vehicles that cross into Manhattan via the George Washington Bridge, far north of the zone, get nothing.

Furthermore, the MTA’s own studies show that vehicles attempting to circumvent the congestion zone will increase traffic and air pollution in surrounding areas.

“By their own admission, there are going to be a lot more cancer-causing pollutants pouring into northern New Jersey and the outer boroughs,” says Congressman Josh Gottheimer (D-NJ), a leading candidate in the primary race for his state’s upcoming gubernatorial election. “That is going to affect the health and safety of our families. New York just obviously doesn’t care a nickel.”

New Jersey filed suit against the pricing scheme. The court ordered additional environmental studies and left open the door for requiring New York to pay more for mitigation measures, but did not halt implementation.

Mr. Gottheimer has worked with a bipartisan group in the US House of Representatives that includes New York Republicans Mike Lawler and Nicole Malliotakis on a bill that would strip the MTA of its $2 billion in annual federal funding if congestion pricing continues. Mr. Gottheimer feels the measure has a good chance of passing.

“You’ve got New York Republicans and New Jersey Democrats, and many others in Connecticut who are really unhappy with this,” he says. “It’s not like the MTA has a huge breadth of support across the country. I think when people get the facts here, they’re not going to love the fact that New York takes all this federal money for the worst-run mass transit system in the country.”

President-elect Donald Trump has also voiced opposition to congestion pricing and supported federal efforts to stop it.

Rubber Hits the Road

Now that congestion pricing is a reality, even steadfast proponents acknowledge that all eyes will be on the plan’s results.

“If traffic impacts aren’t felt, that breaks community trust,” says Dr. Weinberger. “The models we ran gave us insights, but they don’t give answers. The evidence is yet to be seen in how well or poorly it works.”

Advocates express concern that the $9 fee is enough to irritate drivers, but not enough to get them to change their behavior and have a palpable impact on congestion.

Another factor that could undermine congestion pricing’s impacts is voiced by David, an importer of apparel from Brooklyn who travels daily to his Midtown office in .

“I might start taking the [Brooklyn] bridge, which is free, instead of the tunnel,” he says while waiting for his car in a parking garage in the zone. “Then, even with the $9, I’ll save money.”

Projections vary on how much commuters looking to “park and ride” or engage in “toll shopping” will affect congestion, as both options would likely add significant time to commutes. Yet the MTA’s studies show truck traffic increasing on the already congested Cross Bronx and Staten Island Expressways. It also says hundreds more vehicles could be added daily to the traffic-choked Harlem River Drive and Major Deegan Expressway.

“According to the MTA review, this relieves traffic in the zone, but not in the city as a whole,” says Ms. Gelinas.

Matt Eisenberg, a jeweler who comes to the city from New Jersey once or twice weekly for business, points out another factor that should concern New York.

“Going forward, I will do what I can not to come to New York City,” he says after dropping off his car in a garage near 47th Street.

Given the hits to the city’s economy over the last five years, some caution that narrowly focusing on congestion reduction could hurt New York.

“This is only successful if it reduces congestion and the same number of people are still coming in,” said Ms. Gelinas. “Reducing economic activity is not good.”

(Originally featured in Mishpacha, Issue 1046)