Motorists Now Must Pay to Enter the Heart of Manhattan
At 12:01 on the morning of January 5, 2025, New York City’s Metropolitan Transportation Authority (MTA) activated the first congestion pricing program in the United States by charging motorists a toll to enter Manhattan below 60th Street – the core of the world’s most congested city.

Traffic in Manhattan decreased by 7.5 percent in the week after New York City’s congestion pricing plan took effect, according to preliminary traffic data released by MTA on January 13.
More than 700,000 vehicles enter Manhattan’s Central Business District every weekday, and average travel speeds are just seven miles per hour in that district and 4.9 mph in Midtown.
These achingly slow traffic speeds have meant 117 frustrating hours per person per year sitting in gridlock, concluded a 2018 study commissioned by the nonprofit Partnership for New York City, which mobilizes private sector resources to build New York City’s reputation as “a global center of economic opportunity, upward mobility, and innovation.”
Researchers have calculated the economic costs of traffic congestion in Manhattan at $20 billion a year, with drivers and their passengers eventually being stuck with the costs of burning fuel, stop-and-start wear on brakes and tires, and nearly $2,000 a year in wasted time.
But in the week New York launched its congestion pricing program, some 219,000 fewer vehicles entered Manhattan’s Central Business District than in the weeks before the launch.
“The Congestion Relief Zone has been in operation since midnight – 1,400 cameras, over 110 detection points, over 800 signs and 400 lanes of traffic and it’s all gone smoothly,” said MTA Chair and CEO Janno Lieber as January 5 ended.
After the program’s first week, Lieber was pleased with the results. “The early data backs up what New Yorkers have been telling us all week – traffic is down, the streets feel safer, and buses are moving faster,” he said. “Positive change wasn’t guaranteed, and it’s exciting to hear commuters, including drivers, talking about how much time they are saving since the program kicked off a week ago.”
Congestion Pricing and How It Works
In 2020, New York City was the most congested city in the United States, according to the Urban Mobility Report published annually by the Texas A&M Transportation Institute. And New York gridlock has only gotten worse now that the Covid pandemic has receded.
The new toll to enter the Central Business District, now also known as the Congestion Relief Zone (CRZ) varies by time of day. The MTA is encouraging motorists to sign up for the E-ZPass to get the lowest toll rate, discounts, and tunnel crossing credits. For E-ZPass drivers, the peak toll for entering the CRZ is $9.00 and the overnight rate is $2.25. Click here for more information on toll rates and the entire congestion pricing program.
If a driver does not have an E-ZPass transponder in the vehicle, tolling cameras will take an image of the vehicle’s license plate and a Tolls by Mail bill will be sent to the address of the vehicle’s registered owner on file.
The tolls collected will be used to improve public transportation, and there is plenty of room for improvement. Opened more than 100 years ago on October 27, 1904, the New York City subway is one of the world’s oldest public transit systems, and one of the most used and abused.
But the MTA sees riches where many riders see ruin. The Congestion Relief Zone is the “most transit-rich area in the United States,” which enables more than 85 percent of area commuters into the zone to rely on public transit, the MTA explains.
MTA operates 94 subway stations, 99 MTA bus routes, and 2,500 regional commuter trains a day on the Long Island Rail Road, Metro-North Railroad, New Jersey Transit, and PATH, the heavy rail rapid-transit system that links Manhattan and New Jersey.
The new toll is projected to keep 80,000 vehicles from entering Manhattan’s Congestion Relief Zone every day. This means less traffic, cleaner air, and safer streets, while yielding $15 billion for critical transit investments to improve life for the millions of people who rely on the MTA every day.
“Thanks to congestion pricing, MTA Construction & Development will undertake a generational investment to transform public transit in New York,” said MTA Construction & Development President Jamie Torres-Springer. “We’re ready to get these projects started, and we’re ready to deliver them better, faster, and cheaper than ever before.”
In 2022, the MTA announced a trial of hydrogen fuel cell buses, funded by a grant from the New York State Energy Research and Development Authority. The first two buses, the Xcelsior CHARGE H2 made by New Flyer, will be launched in the Bronx this year.
The MTA says it will purchase only zero-emission buses from 2029, and expects the entire bus fleet to be zero-emission by 2040.
MTA Bridges and Tunnels President Cathy Sheridan calls the start of congestion pricing “historic.”
“Congestion pricing will not only benefit mass transit users, but less congestion means safer streets for both pedestrians and motorists – aligning with our own efforts of moving traffic safely and efficiently on our nine iconic crossings,” Sheridan said.
“The implementation of congestion pricing is historic – helping reduce congestion in our Central Business District, allowing for safer streets, while providing much needed resources to New York City’s transportation and transit systems while improving air quality for millions of New Yorkers and visitors,” State Department of Transportation Commissioner Marie Therese Dominguez said.
During the years of environmental reviews and toll-setting processes, hundreds of public meetings and 19 public webinars were held across the 28-county region, with a special focus on environmental justice.
Ten public hearings were held, and more than 102,000 comments were received from the public.
As part of a multifaceted public education campaign, 11 public webinars were held in December 2024, going over eligibility and how to apply for discounts and disability assistance. Ads appeared in 46 newspapers covering nine languages and aired on multiple radio stations in 10 languages.
Converting Drivers to Public Transit Enthusiasts
Getting motorists out of their cars and onto public transit takes money to upgrade subways and buses to make them frequent, convenient and safe for riders; the MTA has factored that into the congestion pricing puzzle.
Under congestion pricing, drivers will be tolled anywhere from $9 to $23 to enter the Manhattan core south of 60th Street. The tolls, by law, must bring in at least $1 billion in annual revenue for the Metropolitan Transportation Authority to finance signal upgrades and repairs in the capital plan.
Eighty percent of the revenue generated by congestion tolls will go to capital improvements on New York City subways and buses, 10 percent will go to Metro-North Railroad, and 10 percent will go to the Long Island Rail Road.
A phased-in toll plan that starts at 40 percent of the eventual toll enables the MTA to issue $15 billion in bonds to fund the MTA’s 2020-2024 Capital Plan and advance critical capital projects that help subway, bus, commuter rail riders, and motorists.
Governor Hochul paused the program in June, worried that it would damage the city’s recovery. But she brought it back in November with a 40 percent reduction in the tolls, down to $9 from $15.
Yellow cabs and Uber will pass along new fees linked to congestion pricing to passengers. Many vehicles in the tolling zone are taxis and cars for ride-hailing services.
The tolls will increase to $12 by 2028, and to $15 by 2031.
The new tolls will not be paid by the drivers of those vehicles, who are often struggling to cover their costs. Rather, passengers will be charged an additional amount for each trip into, out of and within the zone. Even before the new pricing began, passengers paid congestion-related fees of up to $2.75.
Riding in a taxi, green cab, or black car will now cost passengers an extra 75 cents in the congestion zone, which runs from 60th Street south to the Battery at the tip of Manhattan. The surcharge for an Uber or Lyft will be $1.50 per trip. Cars on Franklin D. Roosevelt Drive and on the West Side Highway, roads that define the edges of Manhattan, will not face charges as long as drivers stay out of the tolling zone.
The new plan is expected to generate about $500 million a year during its first three years, and then $700 million when fees first go up, then close to $1 billion a year when the original $15 toll is restored. The money will be used to secure $15 billion through bond financing, which would be paid back with tolling revenue.
The Pause That Refreshes the Plan
After Governor Hochul lifted her pause late last year, the MTA exercised the option to purchase 265 zero-emission buses, the largest order in New York history. This purchase builds on the 60 zero-emission buses that came last year and is in addition to the 205 zero-emission buses scheduled to arrive late this year.
“New York Power Authority (NYPA) and the MTA are working together to set a new standard for urban mobility and environmental stewardship as the nation’s largest bus fleet transitions away from fossil fuels,” said NYPA President and CEO Justin Driscoll. “NYPA is proud to help expand fleet vehicle charging infrastructure for electric buses in Queens and across the city to further reduce carbon emissions and enhance the quality of life for millions of New Yorkers by providing cleaner air and quieter streets.”
To support the expansion of charging infrastructure for the zero-emissions bus fleet, the MTA and New York Power Authority are building new electric bus charging stations, including commissioning automated overhead pantographs that are expected to be operational at the Jamaica Depot in the fall of 2027.
The design and buildout of the Jamaica Bus Depot incorporate the necessary infrastructure improvements to eventually support a full fleet of electric buses. The new depot will allow the elimination of carbon emissions associated with diesel fuel exhaust, yielding cleaner air for everyone.
The new Jamaica Depot will have a green roof, which will clean the air, absorb stormwater, act as a form of insulation, and reduce the depot’s energy use.
The new 40-foot zero emission buses will reduce greenhouse gases by upwards of 90 metric tons annually per bus. They feature lightweight electric traction drive systems that allow buses to recover up to 90 percent of energy during braking.
Starting in the spring, the MTA will upgrade service across 24 bus routes in all five boroughs, including eight express routes and 16 local routes. The MTA is redesigning all the boroughs’ bus networks to improve reliability, speed up commutes, and better serve the travel patterns of today’s riders.
With congestion pricing underway, the MTA is advancing more capital projects, including the Second Avenue Subway Phase 2 tunneling contract and improvements to the Verrazano Narrows Bridge ramps in Brooklyn.
Governor Hochul insists upon two changes – improving safety at New York City’s elementary school Intersections and reclassifying ultra-heavy Class 3 E-bikes as mopeds.
Crashes at intersections in New York City account for half of all traffic fatalities and 60 percent of pedestrian deaths citywide; limited visibility near crosswalks is a key contributing risk. Governor Hochul proposes to “daylight” crosswalks near the city’s elementary schools, keeping them clear of obstructions to protect children at their most vulnerable locations.
Additionally, the growing use of e-bikes in New York City means they must be used safely to avoid accidents. While existing regulations limit e-bike width and speed, they do not address maximum weight, which directly correlates with the severity of injuries in accidents. To address this issue, Hochul will propose reclassifying Class 3 e-bikes weighing 100 pounds or more as mopeds, which require a driver’s license and registration to operate.
An Idea Whose Time Has Come
Canadian-American William Vickrey of British Columbia, winner of the Nobel Prize for Economics in 1996, and a distinguished professor at Columbia University in New York City, is considered the father of congestion pricing.
He first proposed it in 1952 for the New York City subway system, recommending that fares be increased during peak times and in high-traffic sections and be lowered in off-peak times. Elected officials considered the proposal risky and the technology insufficient, so it went nowhere.
Later, Vickrey made a similar proposal for road congestion pricing. He considered time-of-day pricing as a classic application of market forces to balance supply and demand. Those who are able can shift their schedules to cheaper hours, reducing congestion, air pollution and energy use – and increasing the use of roads.
“One possible detection and billing method would use electronic identifier units carried in each vehicle, which would activate recording devices in or on the road. Computers would sort the information and determine charges; motorists would be billed monthly,” Vickery suggested.
And that is exactly how modern road pricing systems function.
Historic Steps for Congestion Pricing
Singapore was the first country to introduce congestion pricing on its urban roads in 1975, and this system was refined in 1998. Since then, it has been implemented in cities including London, England; Milan, Italy; Gothenburg and Stockholm, Sweden; and now in the central business district of Manhattan.
On January 5, Jake Moate was visiting New York City from London. Ever since he has been able to drive, congestion pricing has been in place in his home city. “In all honesty, you just get used to it,” Moate, 29, told the “New York Times” as he left a subway station in Brooklyn. He said he has not seen a “massive difference in the amount of traffic we have in London.”
Wesley Parnell, reporting from New Jersey, wrote on social media on the first day that congestion tolling was having the desired effect. “Traffic is often backed up on Delancey Street leading to the Williamsburg Bridge, a major throughway into Brooklyn,” Parnell wrote. “Today, there was no traffic, and cars were sailing into the borough.”
Millions Dedicated to Achieving Environmental Justice
New York City’s congestion pricing program provides $335 million for mitigation, including $148 million in regional mitigation measures and monitoring of traffic, air quality, and transit station elements.
In addition, the program has committed $100 million in funding for 13 underserved communities in need of environmental justice in the Bronx, Brooklyn, Upper Manhattan and New Jersey.
“MTA’s announcement shows that the congestion pricing is already working,” said Alok Disa, senior research and policy analyst at the U.S. public interest law firm Earthjustice. “The program is expected to raise up to $800 million each year to support critical upgrades, including placing the state’s largest order of brand-new electric buses that will help clean our air. It’s great to see these dollars in action, and this announcement is welcome news for New Yorkers who breathe in the toxic fumes from polluting diesel buses.”
Transportation is one of New York’s largest sources of diesel emissions, harming communities of color across the city, leading to increased asthma rates and cardiovascular disease, Disa said. By electrifying the city’s bus fleet, New York leaders are taking a critical step toward improving air quality and reducing climate pollution across the city.
And now for the icing on the cake. The State of New York has decided to subsidize the further electrification of the MTA fleet. The public transport operator will receive just under $20 million dollars from President Joe Biden’s Bipartisan Infrastructure Law, while the Federal Transit Administration will grant MTA another $70 million.
Additional approval came from the federal government as the Federal Highway Administration gave New York’s congestion pricing plan a thumbs up on November 22, 2024, after the MTA approved the plan in a 12-to-1 vote on November 18.
On December 4, 2024, New York’s Port Authority Bus Terminal got the green light from the Federal Transit Administration and the City of New York for a $10 billion upgrade. Construction is set to begin in Midtown this year, the first repairs there in 75 years.
“Transit is what makes New York the greenest city and the greenest region of the country,” MTA chief Lieber said. “And these new buses, along with all the infrastructure upgrades to bus depots across the five boroughs, mean New Yorkers all over will soon be breathing cleaner air.”
“We’ve made so much important progress thus far in electrifying our mass transit system as we move away from fossil fuels, and it’s incumbent on us as a city to double down on those efforts in 2025,” Queens Borough President Donovan Richards Jr. urged. “The purchase of these new zero-emission buses and the further electrification of the Jamaica Bus Depot is exactly the kind of investment that must define this new year, and I’m grateful to our partners at the MTA and New York City Transit for its efforts to make New York City the greenest big city in the world.”
“I look forward to even more announcements like these in the year ahead,” Richards said, “as we continue to leave no stone unturned in combatting climate change and ensuring environmental justice for all our communities.”
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