The Daily Dirt: Hochul debacle mirrors Shelly Silver screwup

Congestion pricing reversal eerily similar to massive political blunder in 1999

Gov. Kathy Hochul and the late Assembly Speaker Sheldon Silver (Getty)
Gov. Kathy Hochul and the late Assembly Speaker Sheldon Silver (Getty)

As the saying goes, history doesn’t repeat itself, but it often rhymes.

Take the political shit-show that erupted Wednesday in New York: Gov. Kathy Hochul canceled congestion pricing just as it was supposed to debut, after at least $507 million had been spent on the system.

It initially reminded me of then-New Jersey Gov. Chris Christie’s killing the ARC tunnel about $660 million into the project. Christie said he could not risk his state being on the hook for cost overruns.

The media and New Jerseyans treated that as a plausible excuse, even though he could have easily negotiated a contingency plan with New York and the Obama administration. Christie’s successor, Gov. Phil Murphy, last year called it “the biggest policy mistake of the past 50 years in New Jersey.”

The Trump administration blocked the replacement project, dubbed Gateway, which eventually got the green light from President Joe Biden. The new tunnel will run under Hudson Yards to Penn Station.

But there is a much closer parallel to the congestion pricing drama — one that most of New York’s political reporters are too young to remember.

Twenty-five years ago, state Democrats were worried that their candidate would lose a special election for a suburban Senate seat because of a tax on workers who commuted into New York City. At the time, the tax generated about $210 million a year for the city.

Republicans, mostly from outside of the city, controlled the Senate and had the votes to revoke the tax. But the Assembly, led by the late Sheldon Silver, was dominated by city Democrats who loved the tax because it didn’t hit any of their constituents.

Democratic Party leaders, however, badly wanted to win the special election in the Senate, so to prevent Republicans from making the commuter tax an issue in the race, they asked Shelly to repeal it.

The speaker put the votes together and voilà, the tax was gone. (Brooklyn’s Marty Connor, the Senate minority leader at the time, later said his conference passed the repeal assuming it would die in the Assembly, only to be shocked when it didn’t.)

A decade or so later, someone calculated that the commuter tax would be generating more than $400 million annually for the city, had it remained in effect. Today that figure might be closer to $1 billion, which is what congestion pricing would have raised.

Sign Up for the undefined Newsletter

The similarities don’t end there. Hochul obviously blocked congestion pricing because Democratic leaders feared it might cost them several House races in November. (She cited other reasons, but no one believes she meant them. Hochul herself seemed unconvinced, delivering her announcement looking as if her dog had just died.)

The final chapter of the story remains unwritten, but it could well match that of the commuter tax fiasco: Democrats lost the special election and were never able to reinstate the tax.

What we’re thinking about: Will Hochul try to bring congestion pricing back next year, when no federal or state elections are scheduled? Email me at

A thing we’ve learned: Nearly 90 percent of housing markets have more for-sale inventory than they did a year ago, with Florida, Texas and Denver seeing the largest increases, according to the ICE Mortgage Monitor.


— The second of Mayor Eric Adams’ three “City of Yes” proposals was approved by the City Council Thursday, replacing some obscure 1961 restrictions with more flexible zoning. In exchange for its vote, the Council extracted a promise from the administration to advance a rule change next year requiring Council approval for new last-mile delivery facilities. That could severely limit such projects and enhance the value of existing warehouses.

— Tenant activist group Chhaya blasted the Rent Guidelines Board for repeatedly allowing rent increases in rent-stabilized apartments. “It is remarkable that, regardless of operating income, insurance costs, or vacancy rates, the outcome is always the same: higher rents,” the organization wrote in a statement sure to leave landlords scratching their heads. The board’s approved increases have been in the low single digits and less than the jumps in owners’ operating costs.

— The East End village of Greenport is proposing to require home rentals be at least 30 days, which would virtually wipe out Airbnb’s business in the popular North Fork destination. At the same time, the town of Southold, which includes Greenport, is moving to impose a moratorium on hotel projects. The efforts give the impression that residents do not appreciate the extent to which local businesses, in particular the restaurants and shops that locals enjoy, depend on tourism.

Closing time

Residential: The priciest residential sale Thursday was $6.25 million for a 4,600-square-foot condominium at 100 East 53rd Street in Midtown East. Corcoran Sunshine Marketing Group had the listing. 

Commercial: The largest commercial sale of the day was $560 million for a RFR Holding’s 118,600-square-foot office and retail building at 980 Madison Avenue on the Upper East Side. 

New to the Market: The highest price for a residential property hitting the market was $38 million for a 6,500-square-foot condominium at 109 East 79th Street on the Upper East Side. Adam D. Modlin of the Modlin Group has the listing.