Pittsburgh Regional Transit Must Help Save Itself
Pittsburgh Regional Transit (PRT), facing a $100 million budget deficit in fiscal 2025-26, is threatening massive service cuts. And it’s squarely blaming the commonwealth’s transit funding policies for its woes.
State funding is “no longer able to meet the needs of Pennsylvania’s second-largest transit agency,” PRT complains.
But two researchers at the Allegheny Institute for Public Policy offer a major point of order that’s been glossed over by far too many in this debate. And that’s that PRT, holding something of an economic trump card that it has been loath to play for far too long, could take a major step in helping to right its own financial mess.
“As the Allegheny Institute has pointed out over the years, PRT’s bus expenses are among the highest in the nation,” reminds Eric Montarti, research director, and Alex Sodini, a research associate at the Pittsburgh think tank (in Policy Brief Vol. 25, No. 12).
To put PRT’s costs into perspective, the National Transit Database’s listing of the top 50 mass transit agencies (in terms of ridership) shows that fixed-route bus service was provided by 43 of these agencies in 2023.
“In Policy Brief Vol. 18, No.13, it was noted ‘operating expense per [vehicle] revenue hour should be considered the best cost measure since that is the fundamental cost of providing the service,’ the researchers reminded. “PRT reported a bus operating expense per vehicle revenue hour of $258.02. This was sixth-highest of the agencies. The average for the remaining agencies was $188.52.”
And here’s no small kicker:
“PRT operated just over 1.4 million annual bus vehicle revenue hours,” Montarti and Sodini note. “If PRT was operating at the average expense of the 42 other agencies, its bus expenditures would amount to $267 million, or $98 million (27 percent) lower than its actual 2023 expenditure of roughly $365 million.
“These savings alone would cover nearly the entire anticipated deficit,” the think tank scholars say.
By the way, Montarti and Sodini say that included in the group of the 42 other agencies are nine that PRT has utilized for its “peer agency selection” in its annual service reports—including agencies in Cleveland, Minneapolis and Seattle.
“The average operating expense per vehicle revenue hour for the nine agencies was $195.52—24 percent lower than PRT, which was the most expensive.”
And then there’s this equally significant kicker from the Allegheny Institute researchers:
“On bus operating expense, PRT ranked only behind agencies in much higher cost-of-living cities—such as Boston and New York City. “However, there are many higher cost-of-living cities with agencies with lower bus operating expense per vehicle revenue hour than PRT—such as Denver and Los Angeles.”
The commonwealth provided $302.1 million (56 percent) of the $539 million in subsidies and operating revenues in PRT’s current budget. Similar to the current fiscal year, Pennsylvania’s proposed FY 2025-26 budget includes a planned additional transfer of sales and use-tax dollars for mass transit.
Montarti and Sodini say PRT would receive roughly $40 million were this proposal to pass; for FY 2025-26 PRT says its anticipated deficit would be $100 million, well in excess of the amount from the transfer.
“So, does that mean the state will have to dig further?” the researchers ask, reminding that last year, the state’s largest transit agency – the Southeastern Pennsylvania Transportation Authority (SEPTA) – also planned service cuts and a fare increase only for the governor to “flex” $153 million in federal highway funds, which delayed those actions.
And according to news reports, there were seven highway projects not yet under construction from which the money was taken. All but one were outside of SEPTA’s Greater Philadelphia service area.
“Flexing federal funds, especially those meant for projects outside Allegheny County, is not a sustainable solution to PRT’s growing deficit,” Montarti and Sodini stress.
“PRT’s expenses are out of line and changes are long overdue. Hopefully, the Legislature will emphasize cost containment instead of business as usual,” they conclude.
PRT must help itself before it expects taxpayers to ride to its rescue yet again.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy ([email protected]).
