SEPTA could get more money from AP Senate Republicans in the new budget

Senate Republicans are open to increasing state funding for Pennsylvania’s public transportation systems, but they have yet to determine how much they are willing to spend, Majority Leader Joe Pittman (R-Indiana) said this week.

He said he didn’t think Gov. Josh Shapiro’s proposed additional $283 million for transit alone based on sales tax revenues was “attainable.” Pittman said he thinks the transportation package should include new spending on highway infrastructure, and lawmakers will need other revenue sources to offset those costs.

The comments come as SEPTA and other transit systems are pushing for more state funding to facilitate them operate. Transit agencies across the country are in dire fiscal straits as they have yet to recover from the ridership lost during and after the pandemic.

SEPTA projects a $240 million deficit this year due to exhaustion of its share of federal operating aid awarded to facilitate transit agencies survive the Covid-19 pandemic.

Public transportation is a potential sticking point in closed-door negotiations between Shapiro, House Democrats and Senate Republicans that will shape the final budget. Opposition from Republican senators helped stall a proposal for additional sales tax funding for transit last year.

Authority officials have said they are preparing for possible 20% service cuts in case more money doesn’t come to Harrisburg, but they also believe they could operate money from SEPTA’s reserve “service stabilization” fund to keep them afloat through the fall.

SEPTA, the state’s largest transit system, estimates it will initially receive about $160 million under Shapiro’s proposal, which will be funded by increasing the share of state sales tax revenues devoted to public transit.

Pittman said they are interested in tax revenues from regulating “games of skill” as a potential backstop for transportation funding. Arcade games are slot machine-like games that are currently untaxed and unregulated because they exist in a legal gray area. They have popped up in bars, gas stations and convenience stores across the state.

“I really think that regulating arcade games opens the door to a conversation about doing something about transportation and [highway] transportation infrastructure,” Pittman told reporters Tuesday in Harrisburg during an update on state budget negotiations.

Shapiro proposed a 42% entertainment tax.

Pittman added that finding a way to tax electric vehicles, which are not subject to the gas tax, could also facilitate fund transportation. And he did not rule out using sales tax revenues.

“Historically, I have never done anything in transportation without also doing this [highway] transportation infrastructure,” Pittman said. “That’s why I’ve been very clear that if we’re going to do these two things, it has to be done in tandem. I’m having a hard time figuring out where this revenue stream is coming from.”