SEPTA plans to borrow $250 million for rail cars, station makeover

Posted: January 21, 2011

Facing hefty bills for 120 new railcars and a planned makeover of the dilapidated Wayne Junction station in Germantown, SEPTA is planning to borrow $250 million.

The trip to Wall Street's bond markets would be SEPTA's first borrowing for new projects in 12 years.

The new money would provide $208 million for new Silverliner V railcars, spare parts, and training, and $23 million for the reconstruction of the Wayne Junction facility, SEPTA finance officers said Thursday.

If the SEPTA board approves the borrowing at its meeting next Thursday, the agency hopes to have the money within four months, assistant treasurer Tom McFadden said.

SEPTA plans to repay the money over 25 years with anticipated grants from the Federal Transit Administration.

The first six of 120 new Silverliner V cars have been delivered to SEPTA, but only three are in revenue service. The other three are still being tested on SEPTA tracks.

SEPTA hopes to have the remaining 114 new railcars by the end of the year, but the assembly plant in South Philadelphia has been plagued with problems that have repeatedly delayed delivery.

The total cost of the cars and spare parts and associated training and management is $330 million, of which $122 million is being funded with FTA grants.

The cost of the Wayne Junction project is $27.2 million, of which $4 million is being funded by an FTA grant.

The reconstruction of the 110-year-old Wayne Junction station and adjacent facilities was one of 22 SEPTA projects put on hold when state funding was cut last year. But SEPTA officials feared losing the $4 million in federal funding if they didn't proceed with the Wayne Junction project now.

SEPTA has relatively little debt, compared with other transit agencies, and the new borrowing will bring SEPTA's total indebtedness to $565 million, chief financial officer Rich Burnfield said.

Currently, SEPTA spends about $36 million a year on debt service.

SEPTA last borrowed money for new projects in 1999, when it borrowed about $262 million for new cars for the Market-Frankford subway-elevated line.


Contact staff writer Paul Nussbaum at 215-854-4587 or pnussbaum@phillynews.com.

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