Philly transit agency SEPTA sets date to restore service as it seeks permission to use capital funds

Andrew Seidman, Abraham Gutman and Gillian McGoldrick, The Philadelphia Inquirer on Sep 5, 2025

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PHILADELPHIA — SEPTA, the Southeastern Pennsylvania Transportation Authority, has asked Gov. Josh Shapiro’s administration for authorization to fund its operations by tapping a pot of money intended for capital projects such as vehicle repairs and new rail fleets, according to a letter obtained by The Philadelphia Inquirer.

That money would help the transit authority restore service after a judge ordered the agency to halt dramatic cuts to a public transportation system used daily by hundreds of thousands of people in the Philadelphia area.

In a letter dated Friday to PennDot Secretary Michael Carroll, SEPTA General Manager Scott Sauer requested approval to use up to about $400 million in capital funds to support its operations and avoid service reductions for the next two years.

SEPTA expects to restore service Sept. 14, pending PennDot’s approval of the plan, said Andrew Busch, the authority’s spokesperson.

The state budget impasse

SEPTA says its elimination and shortening of dozens of bus routes and other cuts over the past two weeks were unfortunate but necessary to save money as it faces a $213 million budget deficit and lack of funding from the state legislature. The politically divided General Assembly has yet to pass a budget for the fiscal year that began July 1.

SEPTA’s request to PennDot on Friday appeared to closely align with a plan earlier proposed by the Republican-led Senate — one Democrats and the transit authority had initially rejected. Shapiro and Democratic leaders later said they were open to using the capital funding, provided a long-term funding source was established to backfill the account.

“It was our hope that the Legislature could come to an agreement and pass into law Governor Shapiro’s plan to increase recurring revenue and find a long-term solution for SEPTA,” the letter says. But, it continued, “given the legislative delay, and increasing fiscal pressures, we are faced with no other option than to request this waiver.”

Under PennDot regulations, with department approval capital funds can be used for operating purposes to prevent a reduction in service or fare increase, Sauer wrote.

As a result of Thursday’s court decision, he wrote, “SEPTA is required to continue to provide a level of service that is unsustainable without further operating funds.”

A spokesperson for Shapiro said his administration is “reviewing this request and determining next steps.”

Several top Senate Republicans had in recent weeks called on Shapiro to release the funds directly to the transit agencies, pushing him to use his executive authority to use the funds instead of requiring a legislative solution to help SEPTA roll back its cuts immediately.

The legal appeal

SEPTA filed notices Friday that it would ask a state appeals court to overturn the judge’s decisions, which came in response to a lawsuit that alleged the service reductions had an unlawful disproportionate impact on people of color and low-income riders.

The transit authority denies that the service reductions were discriminatory and says it has warned about the need for stable funding for two years.

The lawsuit, filed last week on behalf of a consumer advocate and two riders, claimed SEPTA had enough money sitting in a reserve account to maintain its regular service but chose to create a fake crisis in an effort to pressure lawmakers into handing over more funding.

SEPTA’s lawyers said the plaintiffs misunderstood its financial situation and that depleting its cash reserves would further destabilize the transit system.

After hearing two days of witness testimony and argument, Common Pleas Court Judge Sierra Thomas Street on Thursday ordered SEPTA to immediately halt all service cuts but said it could continue with planned fare increases.

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