Governor Shapiro’s SEPTA Bailout is Another Failure of Leadership

Harrisburg, PA, November 22, 2024 — Gov. Josh Shapiro today announced a plan to divert federal funds to bail out the Southeastern Pennsylvania Transportation Authority (SEPTA).

At a press conference in Philadelphia, Shapiro said he is taking unilateral executive action in ordering PennDOT to direct $153 million of federal highway capital funds, meant for seven highway projects across the commonwealth, to provide a bailout to SEPTA.

This follows a resolution passed by the Philadelphia City Council, which begged him to take this action.

Commonwealth Foundation Senior Vice President Nathan Benefield issued the following statement in response:

“Governor Shapiro’s decision to divert federal highway funds from their intended purpose to bail out SEPTA is another failure of leadership. Rather than work with both chambers of the legislature on a compromise that would provide accountability for SEPTA mismanagement and address infrastructure issues across Pennsylvania, he’s leading from behind and taking orders from the Philadelphia City Council. Shapiro cannot continue to blame others for his ineffective leadership. Yet again, he’s bypassing the legislature instead of keeping his promise to deliver bipartisan leadership as the governor.

“SEPTA has repeatedly failed to serve customers, residents, and taxpayers, and not because of state funding issues. Even before this new bailout, Pennsylvania taxpayers and drivers were footing the bill for SEPTA’s bureaucracy. Shapiro’s bailout attempts to avoid the deep issues he and SEPTA leaders must address. They have refused to deal with rising crime and quality of life violations, nor have they evaluated routes in decades. SEPTA leadership should focus on streamlining service, finding efficiencies, and relying more on fares and local support—like most major metropolitan transportation systems.”

Today’s bailout announcement is just the latest high-profile example of Shapiro failing to lead when the people of Pennsylvania need him the most:

• Expressing concerns about the effects of the Regional Greenhouse Gas Initiative (RGGI), Shapiro promised to work with the legislature on a solution to higher energy prices. He failed, and energy prices have continued to rise while he fights in court for the ability to keep Pennsylvania in RGGI.
• Despite his campaign promise to support Lifeline Scholarships to help students in Pennsylvania’s worst-performing schools get a better education, Shapiro line-item vetoed the program from the state budget, going back on a deal he made with the Senate.
• Shapiro also pledged to accelerate the reduction in the state corporate net income tax, but he hasn’t made any progress.

As ridership has declined by 20 percent, SEPTA’s operating budget has increased by 9.3 percent since 2019. State funds account for 49.9 percent of SEPTA’s funding. This is disproportionately high compared to other large mass transit agencies. The state share for New York City’s Metropolitan Transportation Authority (MTA) is 9.2 percent, for the Chicago Transit Authority (CTA) 26.5 percent, for the New Jersey Transit Corporation (NJ Transit) 26 percent, and for Boston’s Massachusetts Bay Transportation Authority (MBTA) 30.5 percent.

Only 19 percent of SEPTA’s funding comes from fares, a lower share than MTA’s 38 percent, CTA’s 22 percent, and MBTA’s 22 percent. Local government sources account for a meager 7.4 percent of SEPTA’s revenue.

For more on mass transit problems and potential solutions, read our fact sheet.

Learn more about Shapiro’s progress in fulfilling his promises here.

Commonwealth Foundation experts are available for interviews on this subject. Please contact Josh Kaib at jmk@commonwealthfoundation.org to arrange an interview.

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