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Gov. Hochul still has no answers on how to make up loss of congestion pricing revenue

Twenty-four hours after Gov. Hochul tossed a hand grenade into the MTA’s capital budget by putting congestion pricing on an indefinite pause, there remained no clear plan on Thursday to fund the agency’s large-scale projects.

“We have set aside funding to backstop the MTA capital plan, and are currently exploring other funding sources,” Hochul said Wednesday in a pre-taped announcement, taking zero questions from press.

But the governor’s spokespeople provided no details Thursday when asked about the funding Hochul claimed to have set aside.

Asked how Hochul planned to seek “other funding sources” with the state legislative session scheduled to end Thursday night, a Hochul spokesman referred the Daily News to the Governor’s Wednesday statement, which provided no details.

The congestion pricing plan had been expected to generate $1 billion a year in tolling revenue, money which MTA officials had planned on borrowing against to fund $15 billion in capital projects.

Hochul said Wednesday that she was committed to completing those projects — which include everything from subway track maintenance and the purchase of new buses and train cars to tunneling under Manhattan to extend the Second Ave. subway.

But it remained a mystery Thursday where the money to follow through on those plans would come from.

“When you find out, let me know,” State Sen. Brad Hoylman-Sigal (D, Manhattan) told The News.

“I think there’s reluctance to do anything rash, following the announcement yesterday,” he said with a chuckle. “At least among my colleagues, but we’re waiting to figure out a path forward.”

One potential source of funding would be an increase to the so-called payroll mobility tax on large employers in the MTA’s operating region.

But the payroll tax was hiked for New York City businesses during MTA budget negotiations last year, yielding an additional $1.1 billion towards the agency’s operations, and several sources expressed skepticism Thursday that there was political will to raise it again.

“New York City members are aghast at the idea that we would now shoulder the burden for the entire MTA region, which includes 12 New York counties, two Long Island counties and two counties in Connecticut, not to mention New Jersey,” Hoylman-Sigal said. “It is the inverse proposal to what congestion pricing was supposed to solve, which is shared responsibility for the regional transit system.”

Sources with knowledge of the situation told The News that MTA brass was concerned there is no solid plan to fill the funding void. Multiple sources said that Hochul’s announcement caught the agency’s leadership — including MTA chairman Janno Lieber — by surprise.

A lack of funding would endanger a slew of MTA projects — both expansions of the system and overdue repair work.

Some $3.4 billion in federal funding for an expansion of the long-delayed Second Ave. subway will go away if the MTA can’t put up it’s own $4.3 billion in “local match” funding. Those dollars were supposed to come from congestion tolling.

The toll was also slated to pay for modern signalling systems on the A, C, B, D, F and M trains, speeding up service throughout the city.

A lack of funding would also preclude the purchase of 437 new R211 subway cars, the planned replacement for the 1980s vintage R68 cars on the B, D, N, Q, W and Franklin Ave. Shuttle lines.

An R211T train (Marc A. Hermann / MTA)
An R211T train (Marc A. Hermann / MTA)

However much money Hochul is able to secure, sources inside the agency said they would need more than a one-time lump-sum payment.

“The organization has a requirement to be fiscally responsible,” one agency official told The News. “Any alternatives have to provide for the sustainable fiscal health of the MTA.”


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