PA: Facing deep service cuts, PRT considers a request to divert capital projects money to plug its budget gap

 In the midst of a 70-day-old state budget impasse, an opportunity that presented itself on Monday might allow Pittsburgh Regional Transit to avoid a planned 35% service cut and a fare increase.

Gov. Josh Shapiro — who described negotiations for the long-overdue budget as being down to the "minutiae" — directed his administration to allow the Philadelphia region's transit agency, SEPTA, to use capital projects money to fund operations, an option that could be available for Pittsburgh as well.

PRT spokesperson Adam Brandolph said it was considering making a request for a similar waiver and that it would only be a stopgap measure. But Sen. Jay Costa of Allegheny County, the top Democrat in the chamber, said that if the waiver was sought and received, it would free up enough money to avert the cuts and sustain operations at PRT for two years.

Neither Mr. Brandolph nor Mr. Costa said exactly how much money PRT might seek if it asked for a waiver. But approval of the SEPTA waiver will let that agency use up to $394 million in capital assistance funds for operations.

"I am encouraging it," Mr. Costa said of the potential PRT waiver request. "Whatever would avert the route reductions and the fare increases."

The state has been without a budget since July 1. Pressure is building on Mr. Shapiro, a Democrat, and leaders of the Republican-run Senate and Democratic-led House to end a stalemate that has stopped billions of dollars in payments to entities around the state, from schools to local governments to public transportation.

The transit funding was one of the most incendiary issues on the negotiating table. It was unclear Monday whether securing an agreed-upon source of transit funding would become a breakthrough that leads to a deal.

During an appearance in Philadelphia, Mr. Shapiro told reporters "we are down to discussing, really, what I would consider minutiae." He said he has been "running back and forth between the House and the Senate all summer to try and find common ground" and, with the transit issue squared away, it was time to tie everything else together.

In the Capitol, Republican Senate Appropriations Committee Chairman Scott Martin of Lancaster County said he hoped for compromise, that the parties are still talking, and that there was a flurry of negotiating activity over the weekend.

He reiterated Republicans' position that the state is bringing in about $47 billion in revenue a year which, after tax refunds, becomes about $45 billion — far less that the $51.5 billion in spending proposed by Mr. Shapiro in February.

Mr. Martin also said that he was once a county commissioner during a previous state budget impasse, which required the local government to deal with a temporary stoppage of money that was crucial to some county agencies.

"There is always a sense of urgency" to complete negotiations, he said.

Democrats and Republicans in the Capitol have shoved back and forth on the transit funding issue for years. SEPTA — by far the largest recipient of state money among Pennsylvania's transit agencies — implemented service cuts last month that were halted by a judge's order.

Mr. Shapiro blamed Senate Republicans, whom he said repeatedly failed to approve a House-passed bill to give the state's transit agencies a $293 million funding increase, using a bigger diversion of state sales taxes. Senate Republicans in early August passed their own bill that would put about the same amount into transit, in part by dipping into the trust fund that is intended for capital projects such as critical infrastructure upgrades and new equipment.

Democrats labeled the Republican bill a nonstarter. Late Friday, though, SEPTA announced it would seek a waiver from the state to use money from the fund.

Republicans said Democrats could have said "yes" much earlier and saved the Philadelphia-area public a lot of headaches. They called the situation a "manufactured crisis."

On Monday, Democrats including Mr. Shapiro rejected that contention. Among other things, they said the Republican bill would have taken money from current capital projects. Mr. Shapiro said the $394 million that SEPTA will have access to is "future capital dollars that have not yet been earmarked for particular projects."

Mr. Brandolph, the PRT spokesman, emphasized that any waiver request and approval would not fix the agency's long-term financial situation.

PRT, he said, faces "a $100 million operating deficit that will grow each year without additional funding. Using capital funds for operations would delay critical projects and limit future improvements. We will never compromise the safety of our riders or employees."

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