SEPTA is once again finalizing plans for significant cuts and possible fare increases if new mass transit funding is left out of Pennsylvania’s budget.
Details will be released next month, Erik Johanson, the authority’s senior budget director, told lawmakers Wednesday. However, an initial phase would incorporate 20% across-the-board service reductions, mirroring the limited schedules in place during the height of the coronavirus pandemic, he said.
Such a course of action would place SEPTA into a well-publicized “death spiral” of cuts, fare hikes and ridership losses that could result in the authority permanently shuttering routes, stations or entire lines.
“You really do reach this moment when you can’t come back,” Johanson said. “There’s only so much you can cut before you have to start abandoning infrastructure.”
Reopening tracks, repair facilities and stops that go unmaintained for a period of time is very difficult, he added, even if funding eventually materializes. So far, SEPTA is attempting to craft cutbacks that would be more easily reversible.
Austerity measures – including pay and hiring freezes for administrative and managerial positions – has allowed the authority to reduce its anticipated budget deficit to $213 million, from $240 million, for the next fiscal year, which begins in July, according to Johanson.
Much of the shortfall would be covered under a spending plan offered last month by Gov. Josh Shapiro.
His proposed budget would boost statewide transit funding by an estimated $292.5 million, through allocating an additional 1.75% of sales tax revenue to public transportation. The governor’s team projects that total would grow to more than $330 million by the end of the decade.
As by the largest transit agency in the Commonwealth, the bulk of those dollars would flow to SEPTA. Johnson said Shapiro’s plan would grant the authority six years of “fiscal certainty.”
But a similar proposition in the governor’s budget presentation last year failed to make it into the final agreement. Shapiro in November stepped in to “flex” $153 million in federal highway money to prevent a planned 21.5% fare increase and a 20% service cut.
The GOP state Senate majority has pushed for an infusion of driver-focused infrastructure funding to go accompany any transit funding, with some Republicans from far outside the city expressing skepticism over SEPTA’s operations.
Johanson spoke to a friendly crowd Wednesday. State representatives, mainly from Philadelphia, and City Council members gathered in the Navy Yard for a hearing of the House Democratic Policy Committee.
“We’ve essentially been having this conversation (about transit funding) for the past three years up in the House of Representatives,” state Rep. Morgan Cephas, of West Philadelphia, said. “House Democrats are standing at the ready to continue to make it a priority this budget session.”
In talks with GOP lawmakers, SEPTA officials stress the importance of Philadelphia’s economy to the overall Commonwealth and the amount of contracting the authority does with Pennsylvania-based companies, Johanson said.
Last budget cycle, “we made education funding our centerpiece,” added Rep. Joe Hohenstein, whose district includes parts of Frankford and the River Wards. “My opinion is that this year the budget needs to make transportation, and in particular transit funding, we need to make this the centerpiece.”
