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Can Gov. Shapiro’s SEPTA proposal save SEPTA? It depends.

In his budget address, Gov. Josh Shapiro acknowledged SEPTA's role in the state economy. His proposal to fund transit will need to approval by the state House and Senate — and it won't be easy.

A SEPTA worker mopping the floor as commuters get off at the Walnut Street stop for the Broad Street train line in Philadelphia on Wednesday.
A SEPTA worker mopping the floor as commuters get off at the Walnut Street stop for the Broad Street train line in Philadelphia on Wednesday.Read moreTyger Williams / Staff Photographer

Now comes the hard part.

Gov. Josh Shapiro proposed an infusion of $282.8 million a year in new state funding for public transit in his Tuesday budget address, as SEPTA, Pennsylvania’s largest system, prepares for possible 20% service cuts and a 30% fare increase.

The fate of the plan depends largely on navigating the politics of the nation’s only remaining politically divided legislature and whether public alarm creates pressure to act, according to people working closely on the issue.

A similar transit funding proposal did not make it into the budget deal in December. It passed the House, controlled by Democrats, and stalled in the GOP-majority Senate.

As Shapiro noted in his speech, deep cuts to SEPTA would be a crushing blow to Philadelphia and its economy, with repercussions for the state’s finances.

“It is the strongest start we could have,” said SEPTA chief Leslie S. Richards, a former state Transportation secretary, noting the three standing ovations in the transit section of the speech. “I have never experienced anything like that in Harrisburg.”

SEPTA projects a $240 million deficit this year, triggered by the exhaustion of its share of the federal operating money doled out to help transit agencies weather the pandemic. It would initially get $160 million under Shapiro’s proposal, if it passes.

But that’s no sure thing. What a governor wants hardly ever emerges whole, as lawmakers in the state House and Senate rewrite proposals to include their priorities during the ebb and flow of the legislating.

But Shapiro gave transit funding — and SEPTA, in particular — more attention in his second budget address than he did in his first and likely more than any previous governor did, veterans of capital politics said. He argued for public transit as one in a series of proposed investments to help Pennsylvanians and the economy of the state.

Officials and advocates who have been laboring to get state help for SEPTA and other transit agencies cheered the governor’s involvement, saying it could provide some rare momentum. Shapiro was not publicly vocal on last year’s funding bill.

State Rep. Ben Waxman (D., Philadelphia) said that having public transit funding in the conversation among state policymakers can only help. “It’s a positive thing to put a marker down, to say it is something we value,” Waxman said.

What Shapiro proposed

To pay for the increase, the governor wants to increase by 1.75 percentage points the slice of sales-tax revenue going each year to the Public Transportation Trust Fund.

Last year’s failed bill would have raised more money by boosting the allocation of state sales tax revenue for public transit to 6.4%, up from the current 4.4% — an increase of 2 percentage points.

A Shapiro administration official said there were several reasons for trimming the proposal.

“One, obviously, is your total affordability,” said the official, who was not authorized to be quoted by name. “That’s something the governor has talked a lot about. There’s [also] a local element to this, getting local, regional governments involved, as well.”

The governor said he was pushing the counties in SEPTA’s service area, including Philadelphia, “to meet the moment” and increase their contributions to the agency to generate an additional $24 million yearly.

“That’s an important thing to message. The state can’t do it all,” said Connor Descheemaker, coalition manager of the advocacy group Transit Forward Philadelphia. “This is such a fiscally conservative proposal when we have such a big budget surplus.”

Shapiro said that transit and other investments in education and economic development, among other things to help state residents, are more important than the $14 billion budget surplus. He said his budget would not raise taxes and would leave $11 billion in the rainy day fund.

The fight for state dollars

“What [Shapiro] has put forward is absolutely fiscally irresponsible and unsustainable,” said Senate Majority Leader Joe Pittman (R., Indiana), speaking of the governor’s budget as a whole, not just transit funding. “If he wants to get rid of our surplus in our Rainy Day fund, we should then return it to the people who gave it to us in the first place. And that’s the taxpayers.”

In addition, there will be strong competition for state money, starting with funding local school districts, in response to a Commonwealth Court ruling that the current system unconstitutionally shortchanges students.

“Every budget has different focus items that are highlighted and traded and negotiated,” Richards said. “It remains to be seen what the hot items will be and how the negotiations take place.”

Staff writer Gillian McGoldrick in Harrisburg contributed to this article.