Drama in Chicago and Philadelphia: The Transit Fiscal Cliff Has Arrived

June 6, 2025|Philip Plotch

With unprecedented service cuts looming, the transit agencies in Chicago and Philadelphia are taking remarkably dramatic– and public– stances to stave off regional crises.

For the past three years, Eno and others have been warning about an impending fiscal cliff for transit systems. Boston and Philadelphia are now standing at the edge of that cliff. During the COVID-19 pandemic, ridership and fare revenue plummeted leaving massive operating shortfalls for agencies across the country. Congress helped plug this hole. In March 2020, the Coronavirus Aid, Relief, and Economic Security Act provided $25 billion in emergency funding for transit agencies. Subsequent legislation provided an additional $45.5 billion. But this lifeline was always meant to be temporary.

Although transit ridership continues to recover, it still lags pre-pandemic levels. The number of passenger trips in 2024 were 7 percent higher than the year before. However, bus ridership is only at 86 percent, and rail ridership at 72 percent of pre-pandemic levels. As a result, both agencies are now discussing major cuts to transit services while also leading public campaigns for funding needed to avoid those cuts.

Chicago

Three years ago, the Chicago area’s transit agencies — Chicago Transit Authority (CTA), Metra, and Pace Suburban Bus – faced an estimated annual shortfall of approximately $730 million starting in 2026. That gap has since grown to $770 million and the region faces a fast-approaching deadline to address it.

The scale of the potential transit cuts necessitated to address this shortfall is unprecedented. Without new revenue, CTA would be forced to suspend service on at least half its rail lines beginning in 2026. It would close or drastically reduce service to more than one-third of its rail stations and eliminate more than half its 127 bus routes, leaving 500,000 CTA riders without a nearby bus stop. CTA’s acting president, Nora Leerhsen, refers to these cuts as “unconscionable.”

The Regional Transit Authority (RTA), the public agency that coordinates the region’s transit agencies, is no longer working quietly behind the scenes to shore up funding. Instead, it is leading an ad campaign and imploring residents to contact their legislators and tell them to “Save Transit Now.”

RTA has issued stark warnings: “Chicago region’s transit system will be decimated—leaving one in five workers in the City of Chicago without the use of transit for their daily commute; ending all weekend bus service for Pace customers; eliminating early morning and late evening service for Metra; wiping out nearly 3,000 transit jobs; and dealing a devastating blow to the regional economy.” Leanne Redden, RTA’s Executive Director warns, “This isn’t just a transit crisis—it’s a regional emergency.”

The transit agencies are hoping that the state comes to the rescue, but the Illinois legislature’s spring session recently ended without authorizing any new funding. The State Senate did pass legislation that would impose new taxes on deliveries, rideshare trips, and electric vehicles, but the State House did not act on it. Legislative leaders are now considering returning to Springfield for a special summer session to address the transit crisis.

Philadelphia

In the Philadelphia region, a consensus on funding transit services has also remained elusive. The Southeastern Pennsylvania Transportation Authority (SEPTA) is staring down a $213 million budget deficit, starting July 1. Last year, SEPTA avoided a 21.5 percent transit fare increase when the Pennsylvania governor, Josh Shapiro, directed an emergency one-time transfer of funds from the state highway program.

Without new funding, SEPTA is preparing for deep and widespread cuts. All regional rail, subway, and trolley metro lines would see up to a 20 percent reduction in service and the elimination of all service after 9 PM. Many bus routes would face similar service reductions. Even more alarming is that service would be eliminated on 50 of SEPTA’s 151 bus routes, 5 of its 13 regional rail lines, and 1 of its 6 metro lines.

To spur action, SEPTA launched a dramatic public awareness campaign, including a video imploring the public to speak up. SEPTA made the impacts of inaction clear with an interactive map that allows the public to understand exactly how the cuts would impact them.

The clocks are ticking in Harrisburg (the state capital) and Philadelphia. The deadline to pass Pennsylvania’s state budget is the 30th of June.

Progress in other cities

Some transit agencies have been able to secure sufficient funding to avoid draconian service cuts. For example, Minnesota passed a landmark transportation law which dedicates about $450 million annually in sales tax revenue to transit, and provides funding for rail expansion programs. The new bill also ties the state’s gas tax to inflation.

New York took action to avoid a crisis at the Metropolitan Transportation Authority (MTA) which operates New York City’s subways and buses, as well as Metro-North Railroad and Long Island Rail Road. The state increased the regional payroll tax from 0.34 percent to 0.6 percent and reduced the number of employers who are exempted from paying it. These funds are dedicated to the MTA’s operating budget. To help finance the MTA’s capital program, New York also instituted a new congestion pricing program in January.

To learn more about the fiscal cliff, see Eno’s related publications: