Congestion toll anniversary brings victory lap in New York

New York state and city leaders declared congestion pricing a success as the toll program for vehicles entering Manhattan below 60th Street reached the one-year mark.

"The results are in and it is clear that in just one year, congestion pricing has been an unprecedented success in New York," Gov. Kathy Hochul said at a Jan. 5 event to mark the occasion.

"As we mark the one-year anniversary of congestion pricing going into effect, its benefits are clearer than ever," Mayor Zohran Mamdani said at the event. "Traffic crashes and noise complaints are dropping, while funding for the MTA and air quality are rising."

The concept underpinning congestion pricing is that the toll will discourage driving, reducing gridlock in lower Manhattan while simultaneously raising money to help fund the Metropolitan Transportation Authority's public transit services.

It's batting 1.000 on those metrics, according to the New York Metropolitan Transportation Authority's first evaluation report about the program, released in connection with the anniversary.

For most of the day, congestion pricing charges cars $9 to enter Manhattan streets south of 60th street, with higher rates for trucks and larger vehicles, and discounts for motorcycles and during the overnight hours.

The MTA's report says between January and October, entries to the Congestion Relief Zone were 11% lower on average than the pre-toll baseline, resulting in several positive outcomes.

Those who did pay to enter the zone enjoyed the benefits of lower congestion, the report said, with average speed during peak toll hours increasing by 4.6% compared to the same period in 2024.

That benefit spilled outside the congestion zone, with average speeds on crossings entering the zone during the weekday morning commute from New Jersey, Brooklyn, and Queens all improving, by an average of 23% compared to 2024.

Average bus speeds in the zone increased 2.3% to 9.6 mph in January through September of 2025 compared to the same period in 2024, the report said.

Local bus ridership on routes touching the zone was up 8.4% year-over-year in 2025, improving from the 6% increase the year before, the report said.

Subway trips into the zone between January 5, 2025, and September 30, 2025, were 9% higher year-over-year, after a 2% gain the previous year.

That's the way it's supposed to work, according to a May Reason Foundation commentary criticizing the Trump administration's effort to cancel the congestion pricing tolls.

"At its heart, the cordon pricing system operates on a simple economic principle: When a valuable resource is overused, its price should reflect the scarcity that follows," said the commentary authored by Jay Derr, a transportation policy analyst at the foundation.

"In effect, drivers are asked to internalize the external costs they impose on society ? an approach that has been successful in several cities overseas, where cordon charges have led to smoother traffic flow and increased use of public transit," he wrote.

The toll has also been successful in generating revenue, the report said. The MTA is counting on congestion pricing as a pillar of its capital planning, expecting the revenue to support bonds to fund $15 billion of transit and commuter rail capital projects included in its capital program.

The toll program is already a presence in the capital markets. In 2025, the report said, the MTA's Triborough Bridge and Tunnel Authority incurred $1 billion of short-term debt to finance eligible MTA transit and commuter projects that will be retired by future bonds backed by congestion tolling revenue.

Half of that debt came from a $500 million February sale of subordinate revenue bond anticipation notes, with a 2028 maturity priced to yield 2.7% on a 5% coupon.

The MTA, according to the official statement, intends to cover principal and interest payments on the BANs from congestion zone tolling revenue but the bonds that ultimately take out the BANs would be backed by its broader bridge and tunnel resolution.

The BANs were followed by another $500 million borrowing on May 2, in the form of a one-year term loan for which the identity of the lender and the interest rate were redacted in the disclosure of the obligation on the Municipal Securities Rulemaking Board's EMMA website.

The $1 billion of borrowing in 2025 was in addition to $378.8 million of previously issued notes to finance infrastructure costs for congestion tolling, the report said.

As of November 19, $495.9 million of the proceeds have been spent on eligible transit and commuter capital projects, the report said.

The congestion toll arrived in New Year after years of contentious efforts, inspired in part by the creation of a congestion toll zone in London in 2003.

An effort by then-Mayor Michael Bloomberg ran aground in the state legislature in 2008.

But the idea never went away, driven in part by the MTA's deep need for capital funding to keep its aging subway system in a state of order.

That was the impetus for congestion pricing to be enacted and gain then-Gov. Andrew Cuomo's signature in 2019.

It still took almost six years before the toll gantries were turned on, after an environmental review process, multiple lawsuits that are not all resolved, and continued status as a political football for federal and state elected officials.

Hochul, who was effusive last week in celebrating the one-year anniversary, threatened the entire project in June 2024 when she put the tolls on pause three weeks before collections were to begin.

She reversed course after the 2024 election, announcing in November that congestion pricing would begin in January, though the rate was reduced to $9 for cars from $15, with the full rate to be phased in steps through 2031.

Congestion pricing must still survive politics-driven legal threats from two sides. The Trump administration is deeply hostile, and tried to retroactively revoke federal approval for the tolls in February.

The MTA sued to block that, and the judge overseeing the case has allowed toll collections to proceed as the case has been argued. Oral arguments in that case are scheduled for later this month.

Also remaining unresolved is New Jersey's separate lawsuit to block the tolls. Gov. Phil Murphy has said the toll creates environmental impacts in the Garden State, and unfairly burdens New Jersey drivers.

"That deal is a raw deal for our people," he said Nov. 20 in an interview on News12 New Jersey.

Murphy will leave office Jan. 20 after two terms, but his successor, Mikie Sherrill, also criticized congestion pricing when she was a member of Congress.

The Regional Plan Association, a civic group focused on environment, land use, and governance in the tri-state area says the New Jersey politicos, in their focus on car drivers, are ignoring their many residents who take transit across the Hudson.

"New Jersey bus riders coming into the Port Authority Bus Terminal are some of the biggest winners from congestion pricing in terms of time savings," RPA Executive Vice President Kate Slevin said at the Jan. 5 event.