N.Y. Lawmakers End Session Without Replacing Congestion Pricing Revenue

In a searing rebuke to Gov. Kathy Hochul, Democratic lawmakers in the State Senate announced on Friday that they would be leaving Albany for the year without plugging the funding gap left after she backtracked on adopting congestion pricing in Manhattan.

The decision leaves a billion-dollar hole in the Metropolitan Transportation Authority’s budget, imperiling planned projects and raising grave questions about the future of public transit in the nation’s largest city.

Senator Andrea Stewart-Cousins, the majority leader, told reporters late Friday that her caucus had not been able to rally around any of the budget proposals being offered in the session’s final hours. She said they were “trying to figure out a way” to both ease congestion and provide funding for the authority, which oversees the city’s subway and buses and some commuter rail lines.

The senators’ announcement follows two days of frantic negotiations since Ms. Hochul said she wanted to halt the tolling plan “indefinitely” over concerns that it could hamper New York’s economic recovery from the coronavirus pandemic.

The congestion pricing plan, which had been set to take effect on June 30, would have charged most drivers $15 to enter Manhattan’s central business district south of 60th Street, with the goal of reducing pollution and traffic and creating $1 billion a year in revenue for the struggling authority

Several hours after the Senate’s announcement, Ms. Hochul made her first public appearance since saying she would halt the congestion pricing program. She praised the legislative leaders, saying she had worked closely with them over the session, touting accomplishments on housing and social media.

She said that she had secured commitments from the leaders to take action on the authority’s funding at some point, even if legislation had not emerged.

“We don’t need to take immediate action,” she told reporters, adding: “I am prepared to continue working with them from this moment on.”

A Senate spokesman described the agreement somewhat differently, saying it was a commitment “to keep talking, I guess.”

The Senate Democrats’ decision puts Ms. Hochul and the authority in a difficult position.

Without a new funding stream, not only are the authority’s planned capital projects in question, so are its day-to-day operations. And although Ms. Hochul controls the authority board, the members have yet to formally vote to halt the plan. That has led congestion pricing advocates to pin their hopes on the unlikely possibility that the board could defy the governor and proceed with the tolls as planned.

On Friday, Ms. Hochul dashed those hopes, telling reporters that no board vote was necessary.

Carl E. Heastie, the Assembly’s Democratic speaker, suggested earlier Friday that his members were open to a various options, including holding a special session or revisiting the issue next year. “You have to make a decision on raising revenues,” he said.

Lawmakers were blindsided when news broke late on Tuesday that Ms. Hochul had abandoned the plan she had so recently championed.

The shock quickly turned into anger as the ramifications of the decision not to move forward with congestion pricing without a viable alternative for transit funding, became clear.

“Derailing this important program at the last moment and asking the Legislature to come up with an alternative funding mechanism in less than 48 hours is irresponsible, and inconsistent with the principles of good governance,” Senator Michael Gianaris, the deputy majority leader, said in a statement.

Zellnor Myrie, a Democratic state senator from central Brooklyn who is exploring a run for mayor, criticized the governor for what he called “a profound lack of leadership,” particularly when the city’s public transit system is in such dire need of a financial infusion.

And in an op-ed for The Daily News, Senator Liz Krueger, a sometime ally of Ms. Hochul’s, called the governor’s decision “a staggering error” that could violate state law.

The rhetoric signaled a deterioration of a once-celebrated relationship between Ms. Hochul and Democrats in the state Legislature. When Ms. Hochul took office in 2021, she worked to win the trust of state lawmakers, promising a new era of transparency and collaboration.

But a series of decisions since then — from Ms. Hochul’s repeated and public push to roll back the Legislature’s signature bail reform legislation to the Senate’s refusal to confirm her top choice for chief judge of the Court of Appeals — eroded much of the good will.

Ms. Hochul suggested that the funding gap created by her congestion-pricing decision could be filled with a payroll tax on New York City businesses. But lawmakers balked at that plan, which would have shifted the financial burden from commuters onto city residents.

Lawmakers and the governor’s advisers said she had grown increasingly concerned in recent weeks over congestion pricing’s disapproval among New Yorkers. A Siena College poll in April of about 800 registered New York voters found that 63 percent opposed the measure.

An additional concern, she said, was the city’s recovery from the pandemic, which has left office occupancy rates low. Ms. Hochul has said many times that she would like to see New York City busier, particularly in its commercial districts. Congestion pricing critics said the tolls would further deter workers from returning to the office.

Even as Ms. Stewart-Cousins announced that her members would leave Albany without taking action, she left open the possibility of returning for a special session.

“We do come back, as things warrant,” she said, adding: “We will continue to work on this issue because it’s important.”

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