New York City is set to impose a stiff toll on drivers entering parts of Manhattan following approval from the Biden administration. The significant levy would be the first such usage in the United States and may be used as a precedent considered by other large cities.
The plan will likely take effect next year following approval from the federal government.
Separately, New York State allowed its largest city to collect such tolls in 2019.
New York Gov. Kathy Hochul (D) said that with “the green light from the federal government, we look forward to moving ahead with the implementation of this program.”
The exact price structure has not been announced yet, but drivers could soon be facing up to $23 to enter into some of the highest-trafficked regions in Manhattan. According to the plan, drivers would pay higher tolls depending on the time of day they enter the affected areas.
New York City expects to make about $1 billion from the fees every year, which it plans to use for funding its bus and subway system.
The city’s government is considering a system of tax credits and reimbursements to offset some of the cost, including for residents making $60,000 per year or less.
Despite the enthusiasm in New York, officials from neighboring New Jersey oppose the project due to the high likelihood that its resident commuters would not be exempt from the toll.
In particular, New York officials cited the increased traffic due to ride-sharing services such as Uber and Lyft in their decision-making. According to the city, the number of for-hire drivers tripled in Manhattan over the previous decade.
Surrounding counties believe that the new plan penalizes commuters to the Big Apple. Nearby Rockland County Executive Ed Day (R) said that residents of his county “are never on the receiving end of these capital program investments and that needs to change now.”
The MTA said that it received final approval from the Federal Highway Administration to charge a new toll on vehicles entering the busiest parts of Manhattan https://t.co/w0TrSdpI0D
— The Wall Street Journal (@WSJ) June 26, 2023
While congestion pricing has not been used in the United States, the model has been utilized by some international cities such as London and Singapore.