Hochul promotes congestion pricing while considering new taxes

Governor Kathy Hochul celebrated the implementation of congestion pricing on Friday, calling it a positive move for New Yorkers. She spoke near Union Square, where supporters gathered to advocate for tolls aimed at reducing traffic in lower Manhattan. The $9 tolls are expected to help raise $15 billion for the Metropolitan Transportation Authority (MTA) to improve the city’s transit system. During her speech, Hochul emphasized the benefits of reduced traffic and cleaner air. She encouraged New Yorkers to appreciate the improved public transit but acknowledged that further funding is necessary to maintain it. She also hinted at the possibility of introducing new taxes for the MTA. Hochul is considering increasing the payroll mobility tax, particularly for large businesses in New York City, as part of a strategy to fund the MTA's extensive five-year capital plan. Currently, businesses with payrolls over $437,500 pay a 0.6% tax, but proposals suggest a new rate for businesses earning $10-$15 million could raise an additional $2 billion. Business leaders have strongly opposed any tax increases, arguing that they would hurt local companies already facing high costs. Heather Mulligan, of The Business Council of New York State, stated that more taxes are not a solution to the MTA's problems and criticized the overall high tax burden in the state. Meanwhile, uncertainty looms over potential federal funding for the MTA. The U.S. Transportation Secretary recently threatened to withdraw support unless the agency meets safety requirements and compliance with congestion pricing deadlines. Despite the conflicts, there are reports of ongoing negotiations between Hochul and the Trump administration, potentially leading to a broader agreement involving major infrastructure projects. As Hochul wrapped up her celebratory bus ride, she noted the ongoing challenges ahead and indicated that the debate on congestion pricing is not finished.