SEPTA Board to Consider Increasing Price of Tokens, Paper Transfers

In an effort to stem the loss of revenue caused by the ongoing legal challenge to the discontinuation of paper transfers the SEPTA Board will consider a staff proposal to increase the price of tokens and paper transfers during its regular monthly meeting on September 27.

In accordance with the "Standard Plan A" fare increase proposal the price of tokens will be increased from $1.30 to $1.45 and the cost of paper transfers increased from $.60 to $.75. If the Board approves the proposal, the fare increase would become effective on or about October 1.

SEPTA has accumulated a City revenue budget shortfall of about $1.9 million through August as it has continued to issue paper transfers as ordered by the Court of Common Pleas. SEPTA calculates that under the current fare structure the revenue loss will continue at a rate of about $300,000.00 a week as riders continue to purchase tokens and paper transfers instead of purchasing weekly or monthly passes. As the price of tokens and paper transfers did not increase on the assumption that paper transfers would be eliminated, it is believed that some riders who were purchasing passes have now switched back to tokens and transfers.

Facing a projected budget deficit of $129 million in its Fiscal Year 2008 Operating Budget, the SEPTA Board approved an 11% across the board fare increase proposal (Hybrid Plan A). The majority of the fare increase became effective on July 1 and retained the price of tokens at $1.30 and the base cash fare at $2.00, increased the fees for TransPasses, and eliminated the use of paper transfers. SEPTA expected that approximately 75% of existing users of paper transfers, or about 25,000 weekday riders, would find it cheaper to shift to daily, weekly or monthly TransPasses.

SEPTA staff estimated that the plan would produce $35 million of additional revenue. To resolve the additional shortfall SEPTA relied on the receipt of additional state subsidies.

The fare increase is consistent with the recommendations of the PA Transportation Funding and Reform Commission which called for a "Partnership of Actions" to address the serious public transportation funding issues in the Commonwealth. Both the State Transportation Funding and Reform Commission and the HR 538 Transportation audit recommended that SEPTA implement periodic fare increases.

Following the Board's adoption of the Fiscal Year 2008 Operating Budget on July 18, 2007, Governor Rendell signed legislation establishing the Public Transportation Trust Fund. The receipt of state operating funds authorized under the Public Transportation Trust Fund is required to balance SEPTA's Fiscal Year 2008 Operating Budget.

The elimination of paper transfers was scheduled to begin on August 1, 2007; however, the City of Philadelphia filed an action in the Court of Common Pleas challenging the elimination of the paper transfers. On August 16, the Court granted the appeal and ordered SEPTA to continue to distribute paper transfers.

SEPTA appealed the Court of Common Pleas decision. The Commonwealth Court of Pennsylvania is expected to hold a hearing during the week of October 29. However, there is no set timetable for the court to make a decision on the issue, prompting the Authority to implement the fare increase as a stop gap measure.