Study: Dire impact if SEPTA cuts back

Steep hikes in SEPTA fares and cuts in service would hurt the entire region, depressing property values, costing thousands of jobs and increasing business costs, according to the Economy League of Greater Philadelphia.

SEPTA's proposed "Plan B" budget would cost current transit riders $182 million a year, drivers $39 million a year, and cost Philadelphia 43,800 jobs, the Economy League reported in a study presented yesterday to the Greater Philadelphia Chamber of Commerce. Mayoral nominee Michael Nutter was among those at the presentation.

Business, labor and political leaders from the five-county region have been urging the state legislature to come up with a new dedicated funding source for SEPTA and other mass transit agencies in Pennsylvania. Gov. Rendell has suggested a tax on oil company profits to pay for transit funding, but the idea has made no headway in the legislature.

Without a $100 million increase in state aid, SEPTA proposes to raise fares by an average of 31 percent, cut service by 20 percent, and lay off 300 to 400 employees. SEPTA estimates it would lose 20 percent of its riders, about 40 million passengers a year.

Under that "Plan B," the base cash fare for buses and subways would increase to $2.50 from the current $2, and tokens to $1.80 from the current $1.30. Regional rail prices would also rise, with the peak one-way fare for a Zone 3 trip increasing to $5.50 from the current $4.50.

Even if the state comes to the rescue, with $100 million in addition to the $300 million it currently provides, SEPTA plans to raise fares, but by much less. The overall increase under "Plan A" would be 11 percent, but the base cash fare would remain at $2, and the cost of a token would rise to $1.45.

SEPTA last raised fares in 2001.

"This is counterproductive to economic growth," said Steven T. Wray, executive director of the Economy League. "This is about not just transit riders, it's about drivers, it's about property values. It affects people everywhere in the region, not just in Philadelphia."

Among the costs Wray cited:

Property values in Bucks, Chester, Delaware and Montgomery Counties would depreciate by 6.6 percent, or $4.45 billion. A typical suburban home would lose $6,687 in value.

Property values in Philadelphia would depreciate by 6.5 percent, or $2.89 billion. A typical city home would lose $7,431 in value.

State personal income tax revenues would be reduced by $27 million.

City wage-tax revenues would be reduced by $60 million.

Job loss in Philadelphia would be 43,800 jobs, with $1.67 billion in net earnings. Many of those jobs would move to the suburbs, but the five-county area would still lose 14,500 jobs and $868 million in net earnings.

Business impacts would include loss of workers, difficulty staffing night and weekend shifts because of scarce transportation, and increased demands and costs for parking.

Wray said SEPTA had done its part by reducing its workforce and increasing operational efficiency. Since 1996, he said, SEPTA has reduced its number of workers by 14 percent and increased vehicle revenue miles per employee by 45 percent.

"SEPTA operates at a level of efficiency that ranks among the top performing systems in the United States," the Economy League report said. In 2005, the report said, SEPTA ranked high among large U.S. transit agencies in fare recovery, collecting 41.9 percent of its operating expenses from the farebox. SEPTA trailed only New York's MTA and NJ Transit.

SEPTA's board is scheduled to vote on the proposed fare increases on Thursday. The agency's new budget is to take effect July 1.