SEPTA announced yesterday that it might raise fares 11 percent on July 1 - the first day of its 2008 fiscal year - to begin dealing with its $129 million budget hole.

That fare hike, with no service cuts and no change in the $2 base cash fare, is projected to generate $35 million, giving the state Legislature until September to come up with the remaining $94 million.

If the Legislature fails to authorize that money, SEPTA says it will raise fares 31 percent and cut service 20 percent to fulfill its legal mandate to balance its budget.

SEPTA's millions of riders won't be the only ones suffering if the cash-strapped transit agency is forced to invoke its "doomsday" fare hikes and service cuts.

A report released today by the nonpartisan Economy League of Greater Philadelphia, projects that the city would lose 43,800 jobs and $1.67 billion in net earnings over the next few years, while the suburban counties SEPTA serves would lose 14,500 jobs and $868.5 million in earnings.

Steven T. Wray, executive director of the public-policy research organization, said that if SEPTA implements its "doomsday" fares and service cuts, the five-county region it serves also will suffer a major decline in housing and property values.

The Economy League projects that property in the city would depreciate 6.5 percent, losing $2.89 billion in net value, while property in Bucks, Chester, Delaware and Montgomery counties would depreciate 6.6 percent, losing $4.45 billion in value.

"Perhaps most revealing in these staggering numbers is the impact SEPTA has upon businesses and citizens who do not ride SEPTA," said SEPTA General Manager Faye Moore, "and who generally feel that the public-transportation system does not directly - or even indirectly - impact their lives, businesses or taxes."

Moore said that SEPTA does not want to slash service while inflating fares 31 percent, "but no one has suggested viable alternatives that are within SEPTA's power to control. Our present choices are tough and limited."

Riders would immediately feel the pain of higher fares and longer delays between fewer buses and trains, Wray said.

Those that opt for cars instead of mass transit will pay the escalating costs of gas, parking and maintenance, he said.

More traffic jams and longer wait times on mass transit mean more lateness to work and more leaving work early to get home at a reasonable time.

"All those have real costs," Wray said, "and a negative effect on the local economy."

Another negative, he said, is SEPTA's need since 2003 for tens of millions of capital dollars to pay for its operating expenses.

"That's like taking out a home-equity loan to pay the heating bill," Wray said, instead of making essential repairs and upgrades.

"We are approaching the tipping point," he said. *