A closer look shows that SEPTA is being less than straightforward about its need for money this year, its goals, and the 25% fare hike it is proposing.
SEPTA as of June of 2023 had $539.2 million in an account it called a “service stabilization fund.” (It’s on the bottom of the page, where few see it) While the number has not been posted yet, projections based on past years show that in June 2024 SEPTA had over $650 million in the fund.
If SEPTA took 2.21% of its surplus cash, it would not have to raise fares.
Despite what the Inquirer wrote, SEPTA is proposing a 25% fare hike, one of the highest in its history and much more than its consultants have recommended in one year.
SEPTA’s Key Card web page doesn’t say riders get a discount for using the electronic card. While SEPTA has charged less to riders who have used tokens or passes for over 40 years, it has never called it a discount. Token passes and Key Cards lower SEPTA’s expenses and help SEPTA with “cash flow” issues, as riders pre-pay for services, giving SEPTA the use of millions of dollars before the expenses of operating the system.
The new fare structure continues to overburden riders who don’t have credit or debit cards and pay cash. A round-trip ride with two transfers for a Key Card rider will cost $5.00. For a cash rider, that same round-trip ride will be $10.00; twice as much. This also violates Philadelphia law, which requires businesses to accept cash and treat it equally as a charge or debit card.
The plan increases service on the regional rail lines, which, on average, serve wealthier riders. There will be 123 more trains. Bus riders on the City Transit Division, 99% of whom are in Philadelphia, will see continuing service cuts.
SEPTA is cutting those bus routes without making an announcement. Buses are canceled daily because SEPTA’s management has not hired enough bus drivers. As of May, SEPTA cut just under 10% of its bus service. SEPTA doesn’t list the savings it enjoys by cutting busses, but the number is known.
The Governor and the State legislature have said they will address the needs of public transit systems in the fall sessions. SEPTA says they are doing everything possible to ensure the funds are there and is “optimistic about an agreement on funding in Harrisburg.” It should be clear by now that SEPTA’s strategy isn’t working. Last year, the Governor announced that he would provide additional money for public transit systems across the state. When it came time to negotiate the budget, the Governor eliminated the proposal. This year it was the same. The Governor announced the plan and then dropped it during the budget negotiations. One of the things SEPTA has done is try and get Republican support for additional funding by hiring a Republican Party election-denying lawyer, hoping they will ensure republican support for public transit.
Even if the Governor and State Legislators add additional funding for public transit systems, SEPTA proposes to maintain the fare hike.
SEPTA’s logic is hard to follow.
If SEPTA raises fares and lowers the need for additional funding, will that make it more or less likely the State will find the funding for SEPTA? Has SEPTA decided that it will be, once again, unsuccessful in its lobbying for new funds?
Added to the confusion is the math SEPTA uses to close what it says is the budget shortfall created by the lack of state funding.
SEPTA is projected to get $161 million from the state. It received $47 million. The City of Philadelphia increased its subsidy by $7 million. SEPTA says it will save $20 million by not hiring some people and eliminating nonessential employee travel (why was SEPTA paying for nonessential employee travel to begin with?). The fare hikes will raise $14.4 million, and charging for parking at regional rail lines will add another $4 million.
Needed $161 million From the State
Received $47 million From the State
Received $7 million From the City
Projected increased fares $14.4 million Key Card users
Projected parking fees $4 million Drivers
Cost savings $20 million Not hiring workers
STILL NEEDED $68.6 Million
SEPTA will not run out of cash. Even if it eliminated the fare hike, it would still have enough money to cover this and next year’s operating budget.
Stabilzation Fund $650 million FY 2025
Budget Short Fall 2025: $83 million (Remaining: $567 million)
Budget Short Fall 2026 $100 million (Remaining: $467 million)
Left in fund 2027: $ 467 million
SEPTA will hold hearings on its proposed fare hikes on October 16th at 10 am and 4 pm. It is still being determined if the hearings will be meaningful. Will SEPTA be required to answer questions? Will the SEPTA board allow the riders to be represented? Will any member of the Philadelphia City Council attend to protect City riders from bearing the brunt of SEPTA’s failures?
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