How chairman got SEPTA on the track to become No. 1 transit agency

STEVEN M. FALK / STAFF PHOTOGRAPHER The new Silverliner V cars were among the accomplishments cited by the American Public Transportation Association in awarding SEPTA its Outstanding Public Transportation System honor.
STEVEN M. FALK / STAFF PHOTOGRAPHER The new Silverliner V cars were among the accomplishments cited by the American Public Transportation Association in awarding SEPTA its Outstanding Public Transportation System honor.
Posted: February 27, 2013

BACK IN 1995, Pat Deon, a Bucks County businessman newly appointed to SEPTA's board of directors, had his first meeting with General Manager Lou Gambaccini - who had spent decades as a living legend across the Delaware River, where he helped create New Jersey Transit.

But SEPTA might as well have been on a different planet.

"Lou says to me and the other new board members, 'Well, you know we're $75 million in debt, and I'm sure you recall the FBI investigation,' " Deon said.

Deon was flabbergasted. "I can't remember a lot of stuff," he recalls telling Gambaccini, "but I would've remembered those three initials."

Deon, SEPTA's board chairman, laughed heartily at the memory, sitting in his no-frills office on Market Street near 12th, behind a desk distinguished by his "El Presidente" nameplate and the crystal 2012 Outstanding Public Transportation System award - the Oscar of the subway/bus/trolley world - signifying that SEPTA is the best damn transit agency in the U.S. of A.

The American Public Transportation Association award recognizes how far the much-maligned agency has come since Deon first met Gambaccini in the cash-strapped '90s.

"The problem with SEPTA was, they spent like the federal government but they couldn't print money and they couldn't tax anybody," deadpanned Michael J. O'Donoghue, a board member for 18 years before retiring in 2012.

"The perception of SEPTA was that it was fat, inefficient, slothful, a black hole into which money was being poured," he said. "The feds got out of the money-lending, money-giving business to transit. We started going down a slippery slope real fast."

Deon said that when Gambaccini realized "we were on the cusp of being an activist board and weren't going to vote for stuff we didn't understand," he took Deon out to lunch, offered to put him in charge of a board committee and in a final attempt to win him over, said, "And we're both Italian."

Deon remembers telling Gambaccini, "But at least Mussolini made the trains run on time."

Deon laughed again and said: "That was the end of our relationship. I got moved to the child's table at SEPTA board meetings."

Gambaccini retired shortly thereafter. Deon became chairman of the board in 1999, and SEPTA began the long slog toward its transit Oscar.

When the Daily News attempted to contact Gambaccini to get his take on SEPTA in the '90s, a family member said he'd recently returned home from a hospital stay and wasn't up to doing an interview.

O'Donoghue said that when Deon became board chairman, he knew government funding would continue to be a dry well until SEPTA could show a balanced budget and some fiscal common sense.

"No longer could we sit on the board and say, 'Spend the money and more will be coming from Daddy,' " O'Donoghue said. "If someone tells you, 'You're 210 pounds and you should be 180,' you go, 'Yeah, yeah, yeah.' But if the doctor says your heart's going bad, boom! You're on that right away."

Deon said his main focus was, "How are we going to keep SEPTA alive?"

Business sense

He had purchased his father's Bucks County beer distributorship when he was 18, and ran it until he sold it to his son. He helped his father in the commercial real-estate business. He and Eagles broadcaster Merrill Reese bought a small radio station - WBCB (1490-AM) in Levittown - which, he jokes, was so small it survived by selling "dollar a holler" ads.

So Deon knew a business couldn't survive by running up huge deficits and then begging for bailouts. And just like his radio station and his beer distributorship, SEPTA was a business.

SEPTA has not run up a deficit in any year since Deon became chairman. His two long-tenured general managers - first Faye Moore, now Joe Casey - were former chief financial officers.

Under Deon, SEPTA has been audited by government officials more than a dozen times and has come up lean and clean. Deon jokes that the worst thing they found in one audit was that the board ate an upscale brand of potato chips with lunch.

Time for one more Gambaccini story. James C. Schwartzman, a board member since 1991, once owned a company that sold advertising on jitneys down the shore, so he wondered why cash-poor SEPTA was the only transit agency he knew that had no ads.

"Lou told me, 'We will never have transit advertising at SEPTA while I'm here,' " Schwartzman said.

"I said, 'Why not? It produces millions in revenue.' Lou said something like, 'Transit advertising will ruin the aesthetics of my buses.' I thought, 'You got to be [frickin'] kidding me. Who thinks there are any aesthetics to your buses?' "

Eventually, the board saw Schwartzman's logic, and SEPTA has made more than $10 million a year from advertising ever since.

A big accomplishment during Deon's tenure has been the cessation of hostilities between the 15-member board's 13 suburban members and two city members.

Rina Cutler, who was appointed to the board by Mayor Nutter five years ago, said, "It was very clear to me that the city and SEPTA spent a long time poking each other in the eye, and that this relationship was not useful.

"I came from Boston, where people have such a love affair with transit, they wear T-shirts with an MBTA [Massachusetts Bay Transportation Authority] route map on them," Cutler said. "That model didn't exist here."

Cutler said she and Deon "have a healthy respect" for one another and "we don't poke each other in the eyes anymore."

Cutler (so famous for her combativeness that SEPTA's assistant general manager, Fran Kelly, quipped, "Pat should get a Purple Heart for dealing with Rina") said: "I could have decided I'm going to be a bulldog here, make a lot of demands. But it's better to be a sheepdog, herding folks in the right direction. Over time, trust develops."

Hearing Boston-bred Cutler's comments, Kelly cautioned a Daily News reporter, "Just make sure you spell SEPTA right, because she puts an 'R' at the end."

New trains, buses

SEPTA's chief financial officer, Richard Burnfield, said the Deon-era board's commitment to running SEPTA like a business with balanced budgets has attracted hundreds of millions of dollars in government funding that riders enjoy through new Silverliner V regional-rail cars ($330 million), 440 new hybrid buses ($232 million) and beautifully rebuilt subway stations such as Spring Garden and Girard ($30 million).

Burnfield said it's all about constant vigilance.

"We can't operate empty buses and go to Harrisburg and ask for money," he said. "So every year, we rank the bus routes from best to worst performing, and consider what to do about the worst. Even if only five people use a route, 100 people will come to the public meeting and tell us, 'We ride that bus.' You do? Well, gee, I haven't seen you there for a couple years."

Burnfield said SEPTA got $191 million in President Obama's federal stimulus funding because the farsighted board approved money to engineer big-ticket projects long before Congress approved the money to do them.

"We were able to do 32 projects because Pat and the board approved engineering them immediately after the [2008] presidential election," he said.

There was no parade down Broad Street when SEPTA won its 2012 national championship, no Pat Deon sitting atop the Budweiser wagon pulled by Clydesdales like Pat "The Bat" Burrell when the Phillies won in 2008.

That's OK with Deon. SEPTA's riders make 339.4 million trips a year.

"When I first came here, this was just a pitiful operation," Deon said. "For myself and the board, it was like turning around an ocean liner. But we did it."

Of course, the ocean liner's captain never stops scanning the horizon, looking for icebergs.

SEPTA's next high-stakes gamble is the long-awaited, $180 million New Payment Technology debit, credit or prepaid smart-card system to make buying a ride as simple as buying a cup of Wawa coffee.

Buses, trolleys and subway stations are being wired now. Pilot testing begins this fall for a 2014 public debut.

Deon said the new brand-name smart card will be a godsend to SEPTA's riders, including those who don't use banks. "Why should they pay $900 a year in fees at check-chasing trailers?" he said, when they can directly deposit their checks into the new smart cards and pay all their bills without exorbitant fees.

Deon's come a long way from his "dollar a holler" radio days in Bucks County. He doesn't need a parade down Broad Street to tell him SEPTA's No. 1.


On Twitter: @DanGeringer

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