In Depth With Daus: NYC’s Congestion Pricing Is Working. Is Your City Next?

BY MATT DAUS

One year into implementation, New York City’s congestion pricing program has transformed from a proposal to a policy that touches at least a half million daily trips, thousands of regulated vehicles, and the financial health of the for-hire industry and New York City’s transit agency, the Metropolitan Transportation Authority (MTA). Early debates focused on economic and environmental concerns—even drawing the ire of New Jersey lawmakers and President Donald Trump, who vowed to kill the initiative—but now the program’s impact on congestion and revenue is clear.

This assessment matters for the taxi, for-hire vehicle (FHV), and bus industries. These sectors are essential mobility providers, not discretionary users. A year later, many are asking whether congestion pricing effectively manages its goal without placing disproportionate burdens on the services that keep the city moving.

What Congestion Pricing Was Supposed to Do
Congestion pricing—which has its supporters and detractors—aims to reduce traffic and pollution in Manhattan’s central business district (south of 60th Street), improve bus speeds and transit reliability, and create a dedicated revenue stream for public transit investment. By pricing road access, travel becomes more predictable and streets safer, while the MTA gains funding for upgrades, modernization, and state-of-good-repair work.

With the program fully operational for a year, it is now possible to assess who is paying, how much, and whether that aligns with policy goals, particularly for essential mobility providers operating within the congestion zone.

What the Public Data Show So Far
Public data indicated early success. New York Governor Kathy Hochul called congestion pricing “transformational,” citing reduced traffic, improved quality of life, and $550 million in net revenue for transit upgrades. NYC Mayor Zohran Mamdani and the MTA noted faster travel times, safer streets, cleaner air, and billions in capital investment now moving forward.

Key findings:
❱ 27 million fewer vehicles entered the Congestion Relief Zone (CRZ) in 2025, an average daily reduction of 73,000 vehicles (~11%).
❱ Morning rush-hour speeds were up more than 20% at major tunnels and bridges.
❱ Weekday vehicle speeds in the CRZ rose 4%, while weekend speeds improved by 6%.
❱ MTA bus speeds increased 2.3%, reversing a multi-year decline.
❱ Truck speeds rose 5.6%, and vehicle miles traveled within the CRZ declined 7.1%.
❱ Subway trips surged by 9%, express bus trips up 7.8%, and local bus trips were up 8.4%.
❱ Preliminary studies indicate reductions in air pollution, greenhouse gas emissions, crashes, injuries, and fatalities.
Traffic volumes also declined on major corridors that feed into Manhattan, including the Brooklyn-Queens Expressway, Cross Bronx Expressway, and Major Deegan Expressway, with faster travel on approaches from New Jersey.

Impacts on Taxis and FHVs
The MTA’s first-year evaluation shows congestion pricing had little direct impact on taxis and high-volume FHVs like Uber and Lyft. Under the per-trip charge plan, HVFHVs pay $1.50 per trip, while other traditional FHVs pay $0.75 per trip.

❱ Taxi and HVFHV activity within the CRZ remained relatively stable.
❱ Yellow taxis increased 7% (650 vehicles per month) while HVFHVs declined 3% (2,750 vehicles per month), largely due to industry trends pre-dating congestion pricing.
❱ Total taxi and HVFHV trips rose ~1.4% year-over-year.
Revenue contribution: Taxis, HVFHVs, and green cabs account for ~27% of congestion pricing revenue ($149.5 million of $550 million), highlighting the program’s dependence on the for-hire industry.

Legal Challenges
Initial lawsuits seeking to block the program were rejected, allowing tolling to proceed. The primary remaining legal challenge comes from the federal government, with a preliminary injunction allowing operations to continue. Additional suits from trucking interests and New Jersey remain active, addressing toll structures, vehicle classes, and proportionality.

Lessons From the Global Stage (TRB Session Recap)
On the day congestion pricing launched in 2025, my colleagues and I pondered these questions at a Transportation Research Board (TRB) session held that brought together policymakers, regulators, and researchers from cities that have implemented similar programs, offering NYC a valuable perspective. A follow-up TRB session was held earlier this year, which examined NYC’s 2025 congestion pricing implementation, presented early data on travel behavior and economic impacts, and identified lessons learned and insights for other cities considering similar pricing strategies, such as San Francisco, Boston, and Chicago. Although these proposals are several years old, talks could resume based on NYC's success—especially as these cities face budget deficits.

Several themes emerged. First, congestion pricing tends to work best when it accommodates essential and commercial users. Second, legal challenges are common in nearly every jurisdiction but rarely derail programs entirely; instead, they shape how programs evolve. Third, static pricing structures often underperform, while programs that are regularly monitored and adjusted tend to achieve better outcomes.

Perhaps most importantly, these sessions underscored that congestion pricing is not a “set it and forget it” policy. Successful programs adapt as travel patterns shift, economic conditions change, and impacts on specific user groups become clearer. The question is whether the city and state are prepared to adapt accordingly.

What’s Next for Congestion Pricing
Taxis, FHVs, black cars, and buses are not the source of the gridlock the program was designed to address; they are part of the solution. Reduced tolls or complete exemptions during gridlock alert days for these transportation options may make them more affordable and shift trips from private vehicles to these more efficient, shared mobility choices.

For long-term success, policymakers must adapt the system based on evidence. Key recommendations include:
❱ Reduce tolls or exempt taxis, FHVs, black cars, and buses during gridlock days to shift trips from private vehicles.
❱ Improve transit in neighborhoods outside the target zone and subsidize first/last-mile mobility services, including wheelchair-accessible vehicles.
❱ Evaluate economic impacts on professional drivers and delivery services to ensure costs are not simply passed to consumers.
❱ Assess environmental impacts independently to confirm congestion pricing benefits.

Dynamic pricing, scheduled reviews, and stakeholder engagement can make congestion pricing a true congestion-management tool rather than just a revenue instrument.

Lessons for Other Cities
❱ Dynamic, adaptive pricing is more effective than fixed tolls.
❱ Engage stakeholders—including taxis, FHVs, delivery, and bus services—to avoid disproportionate burdens.
❱ Complementary transit improvements maximize benefits and equity.
❱ Prepare legally and politically; programs face ongoing litigation and oversight.
❱ Recognize that local transport providers’ viability is linked to program success.
NYC demonstrates that congestion pricing can reduce traffic, generate funding, and improve mobility—but only if cities plan for flexibility, equity, and industry support.   [CD0326]