In a major reversal, Gov. Kathy Hochul says Penn Station’s renovation will no longer include controversial office towers.

The plan was to have the construction funded through property taxes, but demand for office space is now dwindling, not growing.

What You Need To Know

  • Gov. Kathy Hochul says a plan to pay for Penn Station’s revitalization through large office towers in the area is dead, for now

  • Instead, the new plan will focus on renovating the train station without so much development nearby

  • The decision was made as the demand for new office space has decreased

The plan to modernize Penn Station has languished for years as government officials wrangled over the best way to move forward.

At issue was a plan to build several nearby office towers which would generate revenue to fund the construction.

But now Hochul is offering a new approach, and local leaders have signed on.

“We are no longer tolerating delays. New Yorkers know my feelings. I have not been shy talking about how this is inferior. It’s crowded. It’s congested. It’s unpleasant, and New Yorkers deserve to have the bright light coming in and shine upon them,” Hochul said at a press conference on Monday.

The original proposed office towers were controversial for many reasons. Local residents and store owners say the use of eminent domain would have forced them out and destroyed important landmarks. Some of those protesters were at Hochul’s event Monday.

The other issue is that demand for more office space is on the decline. So relying on that tax revenue in the current environment was risky.

“We have to deal in the realities we are in. And I want to get this done,” Hochul said. “This is the building I am focusing on here and now, with this phasing of this.”

Without private sector funding, the governor and others are looking to the state and federal government to provide resources and dollars.

“Federal funding will be instrumental to this project’s success and I will continue to aggressively seek to use infrastructure law and other federal grants, so we can transform Penn into the world-class transit of that New Yorkers deserve,” Rep. Jerry Nadler of Manhattan said.

In other news, sources confirm that the federal government has given final approval in regards to New York’s congestion pricing plan and no further study will be needed.

Congestion pricing will charge vehicles a fee to enter Manhattan below 60th Street. Hochul has a scheduled event Tuesday to announce more details.