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Governor Hochul Stopped Congestion Pricing—Can She Even Do That?

The governor has created an "impossible mess" for MTA board members and state legislators.

Manhattan Gridlock

(joiseyshowaa / Flickr)

When Governor Kathy Hochul indefinitely postponed congestion pricing on Wednesday, you might have been wondering: Can the governor do that?

The answer to that question lies in part with the state legislature, who will have to help the governor come up with a way to raise the billions of dollars that congestion pricing was supposed to garner, but most crucially, it lies with the board that oversees the MTA, whose members are variously appointed by the governor, the mayor, the unions, and suburban county executives. 

After all, it was the MTA board that voted 11-1 in March to approve the congestion pricing scheme that was, according to state law, supposed to raise $1 billion every year for the MTA's capital expenses, starting on June 30. This is money the agency has been relying on to make essential repairs to subway infrastructure, buy new electric buses, make stations accessible to all New Yorkers—you name it. The board, whose members have a fiduciary duty to the MTA, approved these expenditures—including $500 million for the now potentially useless toll readers—assuming that congestion pricing was going to happen, but now that it is not, there is currently no plan for replacing this $1 billion. Without this money now, in a few years, New Yorkers will be experiencing another Summer of Hell.

Does the MTA board have to bow to the governor? According to the Public Authorities Reform Act of 2009, these MTA board members must act independently. The law says that while board members "may take into consideration the views and policies of any elected official or body, or other person" they should "ultimately apply independent judgment in the best interest of the authority, its mission and the public." It's hard to argue they are applying their "independent judgment" if the governor has publicly ordered them to reverse a plan they voted 11-1 to enact.

"I don't see how the board can [go along with the governor] as fiduciaries to the agency," Rachael Fauss, a policy director and MTA researcher for the good government group Reinvent Albany, told Hell Gate. "Delaying congestion pricing is the exact opposite of sound financial management."

So what power does the MTA board actually have in this moment? While outlets like the New York Times and the AP both reported that the board must vote on the governor's decision, board members Hell Gate spoke to were less sure. In her taped statement, Hochul did not mention the board at all, and flatly stated that she had "directed the MTA to indefinitely pause the program."

"Some people say, 'Yes, the board has to make that decision,' other people say, 'No, the governor can do that on her own.' I'm not 100 percent sure what the right answer is," board member Andrew Albert, who is a nonvoting member, told Hell Gate, adding that he found out about Hochul's announcement like everyone else—from reading the news—and that he was disheartened by the decision. "Just yesterday we had an air quality alert, unrelated to wildfires," Albert said. "We need to get all these cars off the roads." 

Some, including the nonvoting board member John Samuelsen, the head of the national Transport Workers Union, think the board will just roll over and do whatever Hochul wants. "The legal question aside, the practical reality is, that she probably can do this," said Samuelsen, who also sat on the advisory committee, known as the Traffic Mobility Review Board, that helped determine the fee scheme for congestion pricing. Samuelsen, who sharply criticized congestion pricing while he was sitting on the TMRB because of what he viewed as a lack of outerborough service improvements, called Hochul's move "a little bit of a travesty," because while the plan was imperfect, it was still necessary and important to the future of mass transit in the region.

"It didn't have to be this way," Samulsen said. "This could have been a wonderful moment. It could have been a moment in time that created a paradigm shift in commuter behavior in New York City."

Midori Valdivia, a voting board member who was appointed by the mayor, told us that she believes the MTA board should weigh in on the governor's delay.

"As I understand it, the MTA board members have purview on the future of congestion pricing, including any significant delays or pauses," Valdivia said. "There was so much emphasis placed on our continued stewardship of congestion pricing through public hearings, through engagement with the Traffic Mobility Review Board. It seems odd now that when it comes to discussions around significant delays or pauses, that MTA board members are not included in such discussions."

When we asked the MTA about the board's role and the 2009 law, spokesperson Tim Minton referred us to the governor's office, which has not responded to our list of questions.

It seems as if the MTA itself, if not its board, is already going along with the governor: The transit agency's attorneys have alerted the judge overseeing several of the lawsuits filed by congestion pricing opponents to stop the plan that they "no longer anticipate implementation of the program" on June 30. 

Now, the MTA might be facing a different set of lawsuits filed by congestion pricing's supporters, designed to force the state to do what it said it was going to do and turn the program on as planned.

"Everything is on the table. Congestion pricing, and the transit system, and the city's future are absolutely that important," Danny Pearlstein, the policy and communications director of the Riders Alliance, one of the main groups fighting for the program, replied when we asked if they were planning on suing.

Pearlstein suggested that the governor's decision could "still result in such an impossible mess that it brings her down."

"This very well might bring her out of office in various different ways, but one of them is the chaos sewn throughout MTA governance," Pearlstein said.

This outcome would be ironic, given that the governor reversed her support for congestion pricing precisely because she wanted to avoid political disaster and protect Democrats in the SUV-laden suburbs, reportedly at the behest of Representative Hakeem Jeffries. ("This was really a political decision," one consultant told Politico. Samuelsen, the TWU head, put it this way to Hell Gate: "It doesn't take a rocket scientist to figure out the polls, and especially in the contested congressional districts, which I guess, are far more important than the congestion pricing pieces here.")

However, this strategy didn't work when Hochul vetoed a wind energy bill in the fall to appease Long Islanders and protect Democrats—those Democrats lost anyway.

If congestion pricing is actually dead (at least temporarily), the state legislature will have to come up with a supplementary revenue stream, and they have two days left in the session to do so. Rumors are flying that Hochul will try to push a payroll tax increase instead, though state lawmakers are reportedly resisting the idea.

"It’s still unclear to me (and everyone I’ve asked) by what mechanism Hochul is going to indefinitely delay a law," one source in the State Assembly texted us, referring to the 2019 act of the legislature that created congestion pricing. "So my guess is they’re going to try to stick something in a Big Ugly."

Hochul has also promised that revenue from casinos will go toward funding mass transit, but those casinos are years from opening. Unless…the governor speeds up the licensing process, which is currently slated to kick off in 2025. Could New Yorkers see the simultaneous death of congestion pricing and the rebirth of Steve Cohen's Citi Field casino? In Kathy Hochul's Albany, anything is possible. 

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(Top photo: joiseyshowaa/Flickr)

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