HARRISBURG — Republicans who control the Pennsylvania Senate passed a bill Tuesday evening that would pull hundreds of millions of dollars from a special public transit fund to help struggling agencies cover operating costs.
Top Democrats say the legislation essentially cuts funding for transit by robbing a fund that pays for long-planned capital projects and is dead on arrival in the state House.
“While Governor Shapiro appreciates Senate Republicans finally acknowledging the need to fund mass transit systems across the Commonwealth, this is clearly not a serious, long-term proposal that can pass both chambers,” Manuel Bonder, a spokesperson for Democratic Gov. Josh Shapiro, said in a statement. “It’s time to get back to the table and keep working at it.”
SEPTA, the sprawling transit agency that serves Philadelphia and its suburbs, says it will move forward with significant service cuts if lawmakers don’t OK additional funding by the end of the week.
The state Senate bill would dedicate nearly $600 million to transit agencies’ operations over two years, a level of support that echoes Shapiro’s proposal. But it would do so by pulling funds out of the commonwealth’s Public Transportation Trust Fund, from which all transit funding flows.
Those funds are already earmarked for large projects, Democrats say. On the state Senate floor Tuesday, Sharif Street (D., Philadelphia) called it “a cut to mass transit masquerading as funding.”
The bill would also require all agencies to increase fares and broaden the role of the relatively new special prosecutor for SEPTA crimes, a position championed by Republicans.
Joe Picozzi, Philadelphia’s only Republican state senator, called the upper chamber’s proposal a temporary solution and asked his colleagues not to let the “perfect be the enemy of the good.”
“We do not have time for a forever solution,” Picozzi said on the floor of the chamber. “This bridge will get us through 2026.”
The bill passed 27-22.
In a statement, state House Majority Leader Matt Bradford (D., Montgomery) said the bill is “not a serious solution” and “will not pass the House.”
“Raiding the trust fund and redirecting capital funding without sufficient sustainable and recurring revenue will not avert this funding crisis,” Bradford said.
The upper chamber also passed a spending plan Tuesday that would fund the government at its current level for the next year. Pennsylvania’s budget is more than six weeks late, and schools and county-run social service programs say they’ll be in trouble if the state waits much longer to authorize new spending.
The bill would resume those payments, and state Senate Republican leaders say they could revisit major budget components later and potentially increase funding. It passed 27-22.
Appropriations Chair Scott Martin (R., Lancaster) said the budget bill is “looking to get money out the door” to schools, counties, and nonprofits.
“It’s important, as this drags on, that money flows,” Martin said on the floor. “But we still have much work to do.”
State Senate Minority Leader Jay Costa (D., Allegheny), meanwhile, said the bill is “not going to happen.”
State House Democrats backed him up. In a joint statement, Democratic leaders from the lower chamber said GOP senators had “failed to do their job.”
“This budget does not fulfill our constitutional obligation to adequately and equitably fund our public schools and it fails to support critical programs and services such as mass transit. We have a multi-billion-dollar surplus and the governor presented real opportunities to grow our revenues, which the Senate has ignored,” they wrote, adding that they would continue to work toward a “real solution.”
How did we get here?
Republicans who control the state Senate have said any new transit spending must come with a dedicated funding stream. For months, the likeliest source of that revenue appeared to be the regulation and taxation of slot-like skill games.
But in June, Pace-O-Matic, a skill games company that has spent considerable time and money lobbying the legislature, accused GOP Senate leaders of pressuring lobbyists to drop it as a client. The company, in turn, has been accused of intimidating lawmakers.
This political battle has made a deal less likely.
State House Democrats on Monday passed a bill that would increase the amount of state sales tax revenue transferred to public transit by 1.75 percentage points. In a nod to Republican priorities, it would also authorize $600 million in bonds to fund road construction, about half of which would be earmarked for rural areas, and add accountability standards like tracking large agencies' enforcement of fare evasion.
It passed 108 to 95 with support from a number of Republicans, mostly from Southeast Pennsylvania, where SEPTA funding is a pressing concern.
However, state Senate Majority Leader Joe Pittman (R., Indiana) said the bill did “nothing to advance a common sense solution.”
Pittman said he met with Shapiro last week and left “feeling like we were making significant progress.” But he said public appearances by the governor and the state House urging action on SEPTA funding were counterproductive.
That was why, Pittman said, the state Senate was brought to Harrisburg “to consider options to address the consequences of a budget impasse.”
Looming funding impacts
SEPTA, which serves more than 700,000 daily riders across Southeast Pennsylvania, says it will move forward with its first phase of service cuts on Aug. 24, barring legislative action. This 20% cut to all SEPTA services would include getting rid of 32 bus routes, reducing the number of train trips, and axing heavily used special express trips, like those to sporting events.
Other, smaller transit agencies across the commonwealth have said they are in a similar financial position.
A late budget also means the state has already begun to miss payments, primarily to schools and to counties.
State Budget Secretary Uri Monson recently told a long list of providers that receive state funding, from tech schools and libraries to ambulance services and homeless shelters, that at least $2.5 billion would be affected over the next six weeks.
Matt Vanoy, a school board director at Sharon City School District in Mercer County, told reporters that the district “is not in a terrible spot as of [Tuesday.]” Vanoy said the school has enough cash on hand to sustain itself through about four or five months into the fiscal year, assuming its revenue and expenditures are similar to last year.
But he added that the district is delaying purchases and looking at cutting some outright if the impasse continues.
“You’re hurting kids and you're impacting your instructional programs by delaying or cutting those purchases,” Vanoy said. “It's not a crisis for us at this moment, but the longer this drags out, it certainly could become one.”