SEPTA on Thursday approved a $1.49 billion operating budget and a $675 million capital budget for the coming fiscal year.

The budget, which will take effect July 1, includes no fare increases. The agency maintains a schedule of increasing fares every three years, and hikes are due in fiscal year 2021.

The budget includes a projection of declining ridership revenue, reflecting public transportation’s challenges nearly nationwide in competing with ride-share companies and private vehicles. The agency anticipates almost $467 million in fare revenue, almost $3 million less than was budgeted for the current year.

SEPTA’s expenses will increase by about $32 million from the current year, with labor costs being the majority of that increase. SEPTA plans to save money on injury and damage claims, budgeting almost $5 million less than it expected to spend in the current year. SEPTA has said an increase in video surveillance on vehicles and in stations has cut back on the number of fraudulent claims, while new infrastructure and vehicles have improved safety.

Revenue covers about 36 percent of SEPTA’s operating costs. The largest single outside source of money is Pennsylvania, which provides $762 million for the operating budget. Federal money is the second largest source, at $221 million.

The state also provides about $352 million in capital funding, 52 percent of the capital budget. Federal money is the second-largest contributor to the capital budget, $221 million.

SEPTA’s capital budget shrunk by $74 million due to a decrease in money available from a multi-year EB-5 loan, raised from foreign investors in exchange for residency rights in the United States. Capital funding is likely to be the topic of much debate in the coming years. State money for transit relies on payments to PennDot from toll revenue from the Pennsylvania Turnpike, which are due to significantly shrink in 2022. Transit officials are gearing up for a legislative battle to secure dedicated funding.

SEPTA’s capital budget includes more than 120 projects scheduled for the next seven years. SEPTA is allocating about $44 million to restore rail service between Elwyn and Wawa by 2021. The face-lift for the transit hub beneath City Hall is scheduled to continue through 2025 at a cost of $146 million. The agency expects to spend $1.2 billion between now and 2031 on a wide-ranging program to upgrade Regional Rail and subway stations. These can range from making stations more accessible to people with disabilities, to new stations at stops like Conshohocken and Paoli.

For much of this year, SEPTA’s state funding was under threat from a lawsuit that challenged the legality of using toll revenue to pay for transit. The agency prepared a pared-down capital budget of $422 million that would have jettisoned many planned expansions and improvements. That suit was dismissed in April, though the plaintiffs have filed a notice of appeal.