The Trump administration has issued an order for New York City to halt its controversial congestion pricing system by March 21, sparking a legal and political standoff between federal and state authorities.
The measure, which imposes a £9 toll on vehicles entering central Manhattan, has been in effect since early January, aiming to reduce traffic and generate revenue for public transport.
The U.S. Department of Transportation (DOT), under Secretary Sean Duffy, formally rescinded federal approval for the program, arguing that it imposes undue financial burdens on working-class Americans and small businesses.
In response, New York Governor Kathy Hochul and the Metropolitan Transportation Authority (MTA) have vowed to resist the directive, citing environmental and economic benefits.
Federal Order Challenges New York’s Congestion Pricing Initiative
The congestion pricing plan, approved by the Federal Highway Administration (FHWA) under the previous Biden administration, came into effect on January 5.
The toll applies to most vehicles entering Manhattan below 60th Street, with exemptions for emergency and public service vehicles. The MTA reports that the scheme has reduced daily traffic by 10%, with approximately 60,000 fewer vehicles entering the zone each day.
On February 20, FHWA Executive Director Gloria Shepherd issued a letter instructing the MTA to terminate the program in an “orderly manner” by March 21, following Secretary Duffy’s decision to revoke its federal approval.
The administration argues that the toll is an unfair financial strain on commuters, particularly those without access to the subway system.
President Donald Trump, celebrating the move, posted on Truth Social: “CONGESTION PRICING IS DEAD. Manhattan, and all of New York, is SAVED” The administration maintains that the policy disproportionately impacts drivers from working-class areas and suburban commuters, who rely on private transport.
In response, the MTA has filed a lawsuit in federal court, challenging the administration’s authority to revoke approval. According to Janno Lieber, MTA chair, the FHWA lacks legal grounds to reverse its prior decision without due process.
“Once it’s begun, there’s all kinds of case law in federal courts about the procedures that the federal government has to use to take away an approval to reverse a decision. None of this complies with that, and that’s why we are so comfortable that this is a strong case, and we’re going to win.” Lieber said.
Economic and Environmental Impact at the Centre of Debate
Supporters of congestion pricing argue that the policy is delivering tangible benefits, both in traffic reduction and economic activity. According to MTA data, revenue from the £9 toll totalled £48.66 million in January alone, putting it on track to generate £500 million annually for public transport upgrades.
Advocates also highlight environmental benefits, as fewer vehicles on the roads contribute to lower emissions and improved air quality in Manhattan. The MTA’s financial reports indicate that 95% of congestion pricing revenue is collected during peak traffic hours, reinforcing its role in discouraging unnecessary car trips.
Despite federal intervention, the MTA has continued toll collection, stating that only a court order could force an immediate shutdown.
Governor Hochul, who has met with Trump at the White House to discuss the issue, remains firm in her stance. “New Yorkers do not back down,” she said. “Public transit is facing an existential threat from Washington right now, whether it’s the overall funding or whether it is the attack on congestion pricing,”
The lawsuit is expected to be a lengthy legal battle, with implications for transport policy nationwide. Similar schemes exist in London, Stockholm, Milan, and Singapore, but New York’s case marks the first major test of congestion pricing in the United States.
