Just weeks ahead of a June 30 start date, New York Gov. Kathy Hochul announced bombshell news Wednesday, indefinitely postponing implementation of the controversial congestion pricing plan.

As NJBIZ has extensively reported, the first-in-the-nation plan would charge drivers $15 to enter Manhattan south of 60th Street. Rates would vary for trucks, motorcycles, cabs/ride-share services, etc. The project has drawn the ire of many different stakeholders around New York City, the outer boroughs, and, of course, in the great Garden State. That pushback has led to numerous lawsuits, verbal back-and-forth and more.

The New York Times first reported Hochul’s potential pause of new tolling system June 4. The governor then made the news official during a Wednesday press conference.

“After careful consideration, I have come to the difficult decision that implementing the planned congestion pricing system risks too many unintended consequences for New Yorkers at this time,” said Hochul. “For that reason, I have directed the MTA to indefinitely pause the program.”

The plan has been touted as a way to ease congestion in Manhattan’s Central Business District, as well as help fund the MTA. Opponents, especially here in Jersey, have pushed back against bailing out the fiscally strained Metropolitan Transportation Authority. Additional concerns revolve around diverting traffic and subsequent environmental impacts to areas of North Jersey.

Financial pressures

“A $15 charge may not seem like a lot to someone who has the means, but it can break the budget of a hard-working or middle-class household,” said Hochul. “It puts the squeeze on the very people who make the city go – the teachers, first responders, small business workers, bodega owners. And given these financial pressures, I cannot another burden to working and middle-class New Yorkers or create another obstacle to our continued recovery.

“Now, let me be very clear,” Hochul continued. “I remain committed to these investments in public transit. We need to make the MTA service more accessible and reliable, without the projected revenue having to come just from congestion pricing.”

“Given the lawsuits and many other attacks on this process, we’ve already had to prepare for the possibility that congestion pricing could be delayed,” Hochul continued. “We have set aside funding to backstop the MTA Capital Plan and are currently exploring other funding sources. We remain fully committed to advancing all the improvements that New Yorkers have been promised.”

The MTA declined to comment, referring inquiries to Hochul’s office.

Good news

Meanwhile on this side of the Hudson, the news was met very positively. In a statement, Gov. Phil Murphy thanked Hochul for pausing implementation.

“Although we have had a difference of opinion with our colleagues in New York on congestion pricing implementation, we have always had a shared vision for growing our regional economy, investing in infrastructure, protecting our environment, and creating good-paying jobs on both sides of the Hudson River,” said Murphy. “We fully embrace the notion that the success of Manhattan is inextricably linked to the prosperity of the entire Tri-State Area. Gov. Hochul and Mayor [Eric] Adams have been strong, collaborative governing partners and I look forward to continuing to work closely with them for the benefit of all of our residents.”

U.S. Rep. Josh Gottheimer, D-5th District, is a longtime, vocal opponent of congestion pricing. After a five-year fight, he said New York appears to have done right by hardworking Jersey families “and backed off their outrageous congestion tax.”

“Five years ago, I said that we would fight for Jersey families until the very end, and that’s exactly what we did,” Gottheimer stated. “We threw the kitchen sink at New York – and then some – and got it done. Even when some said the fight was over, we kept going. Well today, Jersey families, their wallets, and the environment won big. As I always say – don’t mess with Jersey.”

‘A major win’

“Thank you, Gov. Hochul, for listening to the concerns of residents and leaders from the greater New York Metropolitan area,” said Bergen County Executive Jim Tedesco in a statement. “It is evidently clear that congestion pricing is not a solution for relief, just merely a scheme to redirect negative environmental conditions a few away to Bergen County and other neighboring communities surrounding Manhattan.”

“This is a major win for the people of Bergen County and all who do business in Manhattan,” Tedesco added.

“The New Jersey Chamber of Commerce applauds the apparent decision to indefinitely postpone New York City’s congestion pricing plan,” New Jersey Chamber of Commerce President and CEO Tom Bracken told NJBIZ. “New Jersey’s residents and businesses would bear the brunt of congestion pricing at a time of already rising costs. We remain steadfast in our opposition because it is bad for the state’s economy, especially for those that rely on regularly conducting business in New York City. We hope this decision become permanent.”

More NJ reactions

Another longtime opponent of the plan is weighing in – as U.S. Rep. Mikie Sherrill, D-11th District, noted that she expressed her opposition about congestion pricing to Hochul during the State of the Union in March.

“I’m happy to see that she is finally hearing what I and everyone on this side of the river has been saying for years – New York’s congestion pricing scheme is an unfair double tax on New Jersey families that fails to invest in critical public transit infrastructure and ignores potential negative environmental impacts here in the Garden State, especially communities with historic rates of underinvestment,” Sherrill said in a statement.

Sherrill stressed that New Jersey and New York should work together to develop a new strategy that fairly invests in public transportation, reduces pollution in an equitable and effective manner, and bolsters our regional economy.

“Without punishing Garden State commuters and families,” said Sherrill. “That requires real leadership, not stunts or lopsided attacks on New Jersey.”

New Jersey Business & Industry Association (NJBIA) president and CEO Michele Siekerka, a top business leader and another congestion pricing critic, also commented on the news.

“NJBIA has opposed anything like congestion pricing that makes access to important regional economic centers less affordable for New Jersey residents and businesses – and we support the Murphy administration’s efforts to make sure this congestion pricing scheme did not hurt New Jersey and our regional economy,” Siekerka told NJBIZ. “We’re happy to see those efforts lead to this pause and we hope to continue to explore how to best support regional transportation needs without hurting our economic competitiveness.”

“We are pleased to see congestion pricing paused,” Greg Lalevee, general manager of the International Union of Operating Engineers, Local 825, told NJBIZ. “We applaud Gov. Hochul’s leadership and Congressman Gottheimer’s initiative. Continuing the robust flow of road borne workers, goods, and services from the Hudson Valley and New Jersey will aid New York City’s continued post-pandemic recovery.”

Editor’s note: This story was updated at 2:50 p.m. ET June 5, 2024, to include statements from U.S. Rep. Mikie Sherrill and NJBIA President and CEO Michele Siekerka, as well as a quote from Greg Lalevee at 8:37 p.m. ET. Please stay with NJBIZ for the latest on this developing story.