A SEPTA Regional Rail conductor in Philadelphia.

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In a dramatic about-face, SEPTA is pulling the plug on its controversial King of Prussia Rail project after federal officials expressed doubt that the transit agency could afford the $3 billion-plus rail extension.

The transit authority on Friday afternoon announced it has been denied funding from the Federal Transit Administration’s New Starts program, which had been expected to cover up to 60% of the cost. All activity related to KOP Rail is on “pause.” 

In discussions this week, the FTA “raised concerns about whether SEPTA could fund its share of the project,” including potential cost overruns, per agency spokesperson Andrew Busch.

Officials blamed the state and the five counties that support SEPTA — Philadelphia, Delaware, Montgomery, Bucks and Chester — for providing it with too little money to maintain and expand its infrastructure, compared to what other large transit urban agencies around the country receive.

“SEPTA’s capital budget has been underfunded for decades. This has left the authority with significantly fewer resources than peer agencies to pursue system expansion while also addressing critical infrastructure needs,” SEPTA General Manager and CEO Leslie S. Richards said in a statement. 

Rising project costs worsened by inflation and high interest rates also contributed to the decision, the agency said. 

The estimated cost had mushroomed from $1.08 billion in 2017 to $2.08 billion as of last year, and SEPTA said Friday that the latest projection was $3.02 billion.

What was KOP Rail supposed to be?

SEPTA proposed building a 4-mile spur off of the existing Norristown High Speed Line, with five new stations. It would reach the King of Prussia Mall via the Pennsylvania Turnpike before continuing 1.3 miles east to First Avenue and Moore Road.

The new line was championed almost exclusively by political and business leaders. King of Prussia Business’s Improvement District, created in 2011, revived a dormant, 50-year-old proposal for the rail extension, and shepherded it through a decade of community outreach and environmental review.

Supporters argued the project would revolutionize travel to the largest job center in Philly’s suburbs, attracting 9,768 daily rides and $636 million in annual economic activity.

Environmental review was completed after Richards, a former Montgomery County commissioner, became SEPTA’s general manager in 2020, and the FTA greenlit the project for final design. 

Why was it controversial?

Transit advocates criticized SEPTA’s planning process, which rejected routes along open land or existing highways or tracks, in some cases because of opposition from nearby homeowners. Those decisions needlessly inflated the project’s cost, critics said.

The agency defended its final route choice, saying the new spur would connect several communities with just four miles of track, would allow SEPTA to use an existing maintenance facility and trains, and had a cost comparable to other similar projects.

Advocates also lamented the land use around the proposed stations, which most commuters would have had to reach by car instead of by walking. The King of Prussia Mall, for example, showed no interest in building around proposed nearby stations, for example by redeveloping a parking lot into housing or office space. 

Recent criticism has additionally focused on the high cost for the relatively small number of largely suburban transit riders who would benefit. 

By comparison, the proposed Roosevelt Boulevard Subway through Northeast Philadelphia, while somewhat more costly, could see 100,000 daily customers, most of them city residents. 

Transit advocates have said the money could also be better spent on buying new subway cars, speeding up plans to modernize SEPTA’s trolleys, or improving Regional Rail service.

What happens now?

Just last month SEPTA approved a $125 million construction and design contract for the King of Prussia spur, part of a $390 million budget allocation for the project this year. That contract won’t be executed and all other KOP Rail activities have been halted.

Next month the agency will release its annual capital budget and long-term program, and provide details on how it will use the money that was being reserved for the canceled extension.

“With the funding we have currently, SEPTA must prioritize essential infrastructure work and safety and security improvements to maximize the reliability and effectiveness of our aging system,” Richards said.

In addition to new trolleys, SEPTA plans to acquire new trains for the Market-Frankford Line, and it has been gradually making more stations wheelchair-accessible, among other projects.

Yet Richards continued to defend the King of Prussia project, arguing it would have eased highway congestion and reduced air pollution.

“We are disappointed,” Richards said. “King of Prussia Rail would have delivered real benefits to our city and region by providing reliable public transportation connecting our three largest employment hubs in Center City, University City, and King of Prussia.”

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Meir Rinde is an investigative reporter at Billy Penn covering topics ranging from politics and government to history and pop culture. He’s previously written for PlanPhilly, Shelterforce, NJ Spotlight,...