Congestion pricing countdown: Hochul has to fill the $15 billion hole she put in the MTA’s budget

Early voting is underway and Election Day will soon be here, with Nov. 5 looming large for the future of the subway. There is a big mess that Gov. Hochul needs to fix — a mess she created — once the election is over.

The subway opened 120 years ago today, Oct. 27, 1904, and as happened earlier during the past century, the trains are in trouble, as last week state Comptroller Tom DiNapoli had some grim findings about subway finances.

After getting rocked by COVID, with a huge dip in farebox revenue and the phase out of the federal emergency backstop, the MTA was looking over what they called a “fiscal cliff.” It took a lot of struggle to get Albany to own up to its responsibilities, but to her credit, Hochul won a financial support package in the spring of 2023 that put the MTA’s books in balance.

On track, to use a pun.

But then on June 5 of this year, it was Hochul herself who pulled the emergency brake, in a moment of panic, to derail congestion pricing due to start just 25 days later, on June 30.

The $15 per car fee for driving south of 60th St., which was to bring in $1 billion a year, which could be bonded out to generate $15 billion for the capital plan, was gone. That’s a big problem that we and others pointed out on June 5, when Hochul said all would be fine.

Five months later, all is not fine, as DiNapoli reports: “The pause on congestion pricing has created a $15 billion funding shortfall in that capital program, which may create additional operating budget costs from higher maintenance costs ($260 million annually) and higher debt servicing costs ($300 million
annually).”

Subway ridership, despite some happy talk from the MTA about breaking post-COVID records of 4.3 million per day, is still at only about 70% of the pre-COVID norm, when there were another 1.5 million daily trips. As a comparison, the missing 1.5 million trips is greater than three times the total daily ridership of the country’s next larger subway system, in D.C. After more than four years, work from home for many is permanent and those people just aren’t riding the subway twice a day at $2.90 a trip.

Hochul did her “pause” to help Democrats with suburban House races in New York. We don’t think it will matter in those contests. But congestion pricing may matter at the top of the ticket. Come a new administration in the White House on Jan. 20, 2025, there might be an order to the federal Department of Transportation to rescind its approval. If the program had been running since June that would have been much harder to achieve.

Hochul is being sued by advocates who support congestion pricing, which is a requirement of state law. Her private lawyers’ replay to the suit was moved from Oct. 15 to Nov. 15, when 10 days after Election Day, we assume the outcome of the presidential election will be known and maybe the fate of congestion pricing, which she put at risk.

As for the missing $15 billion that has DiNapoli worried, the governor told an interviewer last week that she’ll have a replacement plan by year’s end. That’s only two months away.