SEPTA’s impact on the region and the state, as well as the transit system’s critical and unfunded needs, were the subject of discussion during a Pennsylvania House of Appropriations Committee meeting last week.
SEPTA General Mgr. Joseph M. Casey offered testimony and answered a wide-range of questions from state representatives. Casey said his purpose was to stress the “urgent need for comprehensive, dedicated, statewide investment in Pennsylvania’s transportation network – particularly public transit.”
SEPTA is a prime example. The Authority’s capital budget has been reduced to approximately $300 million – its lowest level in 15 years – forcing the deferral of dozens of improvement projects. These reductions come as SEPTA is experiencing its highest ridership in 23 years. Last year, 339.4 million trips were recorded on SEPTA’s buses, trains and trolleys. SEPTA serves more than 76% of all transit passengers statewide, but receives just 63% of state operating assistance for public transportation.
“SEPTA’s ability to meet the region’s growing reliance on public transportation is constrained by operating and capital budgets that have not grown to reflect the needs of an aging transit system,” Casey said. “Without adequate capital funding, SEPTA is unable to advance mission-critical projects, such as the rehab of aging power substations and bridges.”
Casey noted the importance of SEPTA to the local and state economy. SEPTA’s operations support a region that is home to 40% of the state’s economic activity and private-business payrolls.
House Appropriations Committee Member and Philadelphia Delegation Chair Cherelle L. Parker (D-Northwest) said Casey made a compelling case for the statewide benefits associated with increased public transportation investment.
“SEPTA’s impact on the state and local economy is undeniable,” said Parker, the Democratic Chair of the House Subcommittee on Public Transportation. “Every passenger trip SEPTA provides contributes in some way to the economy. Also, the Authority’s reinvestment across the state – $1 billion of goods and services purchased from Pennsylvania companies over the last four years alone – makes SEPTA an important economic partner for every region.”
Casey also pointed out SEPTA’s ongoing efforts to control expenses, including negotiating responsible labor contracts that reduce legacy costs, and efforts to explore all avenues available for keeping operating costs down. For example, the Authority has a long-term contract to purchase diesel fuel for $2.61 a gallon, which is significantly below prices at the pump. In addition, a growing number of SEPTA’s bus fleet of 1,400 are diesel-electric hybrids, which increase fuel savings.
“I was pleased my colleagues were able to learn more about SEPTA’s cost-containment measures and the steps they have taken to minimize legacy costs,” said Appropriations Committee Chairman William F. Adolph (R-Delaware). “From an operations and fiscal management perspective, SEPTA is a model of efficiency for other transit systems to follow.”
During the hearing, the representatives asked about SEPTA’s decision to purchase hybrid buses instead of CNG vehicles. Casey said it would be too costly to launch a CNG program, as an estimated $46 million in work would be need to convert just two of SEPTA’s bus depots. Casey did say, however, that SEPTA would be open to ideas for public-private-partnerships related to CNG.
Casey also pointed out that SEPTA has also aggressively pursued new sources of revenue in recent years, such as selling advertising at stations and on trains and buses. SEPTA’s annual advertising income has doubled since 2005, from $6.2 million to $15 million annually. SEPTA is also saving money on energy costs and other expenses by focusing on a Sustainability Program with a comprehensive triple-bottom-line (environmental-social-economic) agenda.
These efforts have helped SEPTA produce balanced budgets for 13 years in a row – although that streak is threatened by what would be a $38 million shortfall next year at current operational funding levels.