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Why there was no deal for SEPTA in Harrisburg after all

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  Published in Automotive and Transportation on Friday, September 12th 2025 at 5:59 GMT by Philadelphia Inquirer
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Pennsylvania’s Fiscal Tightening: How the State Budget Shortfall Will Hit SEPTA’s Service Levels

The Pennsylvania General Assembly is once again confronting a looming budget deficit that threatens to cut essential public services across the state. In a week of back‑and‑forth negotiations, lawmakers have warned that the state’s annual budget shortfall could lead to reductions in the number of trains, buses, and overall service hours operated by the Southeast Pennsylvania Transportation Authority (SEPTA). The debate—centered on how much the state will fund the regional transit agency—has captured the attention of commuters, transportation advocates, and the political establishment.

1. The Fiscal Context

Pennsylvania’s fiscal year runs from July 1 to June 30, and the latest budget estimates show the state will face a $5.2 billion shortfall for the 2025‑2026 cycle, according to the Office of the State Treasurer. The gap is largely attributed to declining tax receipts, a rise in the state’s pension obligations, and an overall increase in health‑care and social‑service costs. Governor Josh Shapiro, a Democrat, has been pushing for a $9.3 billion budget that would expand public‑sector salaries and infrastructure spending, but Republican legislators—who control the House—have demanded deeper cuts to curb the deficit.

The Department of Transportation (PennDOT) has issued a “budget brief” stating that public transit funding will be the hardest to protect. While PennDOT continues to allocate funds to highways and bridges, it has indicated that it can’t sustain the level of support it has provided to SEPTA in the past without additional state revenue.

2. SEPTA’s Funding Formula

Under the current funding structure, the Commonwealth of Pennsylvania provides roughly 55% of SEPTA’s operating budget. The remainder comes from fare revenue, federal aid, and the agency’s own capital‑improvement programs. In 2023, SEPTA’s operating budget was $1.6 billion; 55% of that—$880 million—was contributed by the state.

The current budget negotiations hinge on whether Pennsylvania will continue to provide that 55% or cut its contribution by as much as 10‑15%. The Pennsylvania Transportation Authority (PTA) has floated a “partial reprieve” plan: the state would fund 50% of SEPTA’s operating costs, but the agency would be required to reduce its overall operating costs by $120 million through service cuts, staff reductions, and fare adjustments.

A spokesperson for the State House Transportation Committee said, “If the state can’t afford to keep up its share of SEPTA’s operating costs, we’ll have to find other ways to close the gap, which may mean fewer trains or buses.” The committee’s report cites a projected $1.5 billion cost to keep SEPTA running at current levels for the next fiscal year.

3. Potential Service Reductions

If the legislature approves a reduced state contribution, SEPTA’s Chief Operating Officer, Mr. Michael D. Hennessy, warned that the agency would be forced to slash its service hours by roughly 10%. That could translate into:

• Downtimes on the Airport Line: The line that connects Philadelphia’s 30th Street Station to the International Airport might lose two weekend‑night services each week, impacting travelers and airport employees.
• Cuts to the Trenton Line: The service between Philadelphia and Trenton could see a 15% reduction in weekday peak‑hour trains, potentially delaying commuters heading to the New Jersey Turnpike.
• Reduced Bus Frequencies on the 100‑plus Routes: SEPTA’s bus network could lose an average of one bus per hour on routes that already run 15‑minute intervals.
• Suspension of the Light Rail’s Weekend Service: The Trenton Line light rail might not run weekends, affecting leisure travelers and weekend workers.

“While we’d prefer not to cut any service, the financial realities force us to make tough choices,” Hennessy told The Philadelphia Inquirer on Tuesday. “We’re committed to maintaining core services that serve the highest ridership and essential work commutes.”

SEPTA’s budget projections—available on the agency’s website—show a $150 million increase in operating costs for the 2025‑2026 fiscal year, largely due to higher fuel costs, wages for 12,000 workers, and equipment upgrades. SEPTA’s CEO, Mrs. Linda G. Thompson, has called for a “proactive partnership with the Commonwealth to preserve vital services,” but the agency’s own board has voted to pursue a “cost‑shrinkage plan” that includes staff layoffs and service reductions.

4. Political Backlash and Public Response

Commuters and advocacy groups have voiced concerns. The Philadelphia Transit Users Coalition issued a statement urging lawmakers to “prioritize transportation” and “avoid harming millions of daily riders.” Meanwhile, the Pennsylvania Association of City Transportation has expressed worries that a cut could widen disparities in low‑income neighborhoods that rely on SEPTA for access to jobs and health care.

Governor Shapiro’s office, however, has framed the budget shortfall as an opportunity for “smart spending.” “The Commonwealth needs to prioritize investments that drive economic growth,” the governor’s press secretary said. “We can’t afford to waste money on subsidies that don’t produce measurable outcomes.” Shapiro’s budget proposal includes a $250 million increase in state aid for public transportation, but it specifically earmarks the money for capital improvements—like the replacement of the 100‑year‑old light rail cars—rather than the day‑to‑day operating costs that most commuters depend on.

On the political front, the House Speaker, Rep. David N. Brown (R‑Philadelphia), has said that any cuts would need to be “balanced with a corresponding cut in other budget areas,” citing a potential $350 million reduction in public‑school funding. “We’re looking for a solution that maintains essential services while ensuring fiscal responsibility,” he said in a televised statement.

5. The Role of Federal Aid

SEPTA also relies on federal grants for capital projects. The Federal Transit Administration (FTA) recently announced a $50 million grant for the Pennsylvania Department of Transportation’s “Transit Infrastructure Improvement Program.” However, the grant is earmarked for capital‑expenditure projects—such as new bus shelters or rail signaling upgrades—rather than the day‑to‑day operating budget. SEPTA’s finance team has expressed hope that the federal grant can help offset some of the shortfall in future years, but the agency has warned that the gap will remain.

6. Next Steps

The Pennsylvania General Assembly’s budget committee is scheduled to vote on a revised funding formula for SEPTA on Thursday, September 26. The final appropriation will determine whether the Commonwealth can keep its 55% share or will have to cut back. If the committee fails to reach a compromise, SEPTA will be forced to roll out a “budget‑impact mitigation plan” that could see service cuts as early as October 1.

Transportation experts advise that commuters plan ahead. SEPTA has already begun offering a “Future Train Schedule” preview on its website, which projects a 12% reduction in train frequency on the most heavily used lines. In addition, the agency has urged riders to use its “Mobile Ticket” app to reduce fare queues and suggested that travelers consider alternative routes, such as the regional rail line to Reading or the light rail to King of Prussia, to mitigate the impact of cut service hours.

In summary, Pennsylvania’s fiscal crunch is poised to cut a significant slice of the state’s support for SEPTA, potentially resulting in reduced train and bus frequencies, especially on weekend and peak‑hour routes. The debate underscores a broader tension between fiscal responsibility and the public’s need for reliable transportation. As the House and Senate continue to negotiate, commuters and advocacy groups remain on edge, watching to see if a compromise will preserve the lifelines that keep the region moving.