A U.S. District Court ruled against the Trump administration's attempt to block New York City's congestion fee, clearing the way for the tolling program to continue while broader legal challenges over federal authority and local transportation funding play out.

In February 2025, Transportation Secretary Sean Duffy had ordered the city to shut the tolling program down, arguing at the time that the Federal Highway Administration had the authority to withdraw its prior approval of the plan, and threatening to pull federal funds from New York if the city did not comply. More than a year later, U.S. District Judge Lewis Liman labeled the move "arbitrary and capricious, an abuse of discretion, and not in accordance with law," as part of a March 3 ruling that found the administration had overstepped its authority and failed to justify its reasoning.

"The democratic process worked," Liman wrote, referring to how New York's legislature had passed the toll, which was then signed into law by Governor Kathy Hochul, and approved for federal funds by the Biden administration in 2024. The first-of-its-kind program in the U.S. charges passenger vehicles and smaller commercial vehicles $9 once a day during peak periods, as well as $14.40-21.60 for commercial trucks depending on size.

In a statement released in the wake of Judge Liman's ruling, Hochul described New York City's congestion fee as a "once-in-a-lifetime success story," having helped reduce gridlock by as much 11%, cut down on emissions by 22%, and increase transit ridership by 7%, according to Metropolitan Transportation Authority data released in January 2026.

Duffy had previously claimed that the program represented a "slap in the face to working class Americans and small business owners," arguing that it unfairly targeted drivers commuting into Manhattan and would drive up delivery and freight costs for businesses operating in the city. Speaking to the Associated Press, the U.S. Department of Transportation said that it would be reviewing its legal options in the days ahead, which could include appealing the district court's ruling.