SEPTA will receive $153 million from the state to prevent massive fare increases and service cuts until at least July.
Gov. Josh Shapiro ordered PennDOT to flex funding away from seven highway projects to aid the transit agency. While the money won't be enough to completely close its $240 million gap, it will buy SEPTA another six months to create a longer-term plan.
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The region's five counties also pledged to deliver addition funding, with Montgomery County being the only one to disclose a specific amount ($1.1 million). SEPTA said it will be meeting with county leaders later Friday to discuss contributions, but the agency said those dollars won't be enough to cover the remaining $47 million.
Shapiro announced the news alongside local leaders at Frankford Transportation Center on Friday morning. He said the seven highway projects where the funding is being diverted have not begun construction or even reached the bidding stages, and he still expects them to be completed on time.
"There's no reason to keep that money on our balance sheet when we can invest it in SEPTA," Shapiro said.
City Council unanimously approved a resolution Thursday calling on the state to transfer those funds toward SEPTA. Typically, the government recommends splitting federal funds 80% to highways and 20% to mass transit, but states do have some say in how they spend it.
On Thursday, SEPTA's board approved a 7.5% fare increase, which will still take place Dec. 1 despite this announcement, and it was set to begin hearings on Dec. 13 about an additional 21.5% bump. If Friday's announcement didn't deter the plan, a fare increase would have gone into affect Jan. 1 alongside service cuts. SEPTA said that it will consider a similar raise next year if no longer-term plan emerges.
According to Chief Operating Officer Scott Sauer, the 7.5% hike will add about $45 million in revenue. The transit agency also put a pause on the Bus Revolution plan, its route overhaul, will prolong a hiring freeze and limit contracted consulting.
Sauer said the additional state funding "plugs the hole," but that SEPTA's deficit remains large even with today's announcement.
"When we passed our budget back in July, we budgeted on the idea that we would be [publicly] funded," Sauer said. "It didn't happen. We're not going to do that again. That's why, next year when we come forward with a budget, we're going to budget based on what we know we have."
SEPTA also faces pressure from the proposed 76ers arena in Center City, which would require significant service increases to Jefferson Station. However, the transit agency said it can't support this additional cost, and the 76ers testified last week that they won't pay for the added operations, either. Sauer said outside sources will have to cover the cost.
"Certainly, somebody should pay," Sauer said. "We're not going to hand the bill to anybody, but somebody has to come in."
Earlier this week, SEPTA avoided strikes when it reached tentative contract agreements with two of it's largest unions: Transportation Workers Local 234, representing 4,000 of its bus, trolley and subway drivers, and SMART Local 1594, a group of 350 suburban operators of the Norristown High Speed Line, the Route 101 and 102 trolleys and buses. The new contracts include a 5% wage raise, increase in pension and bulletproof enclosures for bus drivers.
Both the contract approvals and the fresh funding are only temporary solutions for SEPTA's long-term health. However, many said they hoped today's work can spark more collaboration between agencies and the state legislature.
"I remain hopeful that the flexing that occurs today will result in a serious conversation that might result, and hopefully will result, in a transportation bill that will land on your desk next June, Governor," PennDOT Secretary Mike Carroll said.