SEPTA is pausing the King of Prussia Rail project following further review of rising costs, which have been exacerbated by inflation and high interest rates. The project is not recommended for federal New Starts funding in Fiscal Year 2024, and SEPTA will use resources that had been allocated for KOP Rail to bolster essential infrastructure work.

A major factor preventing KOP Rail from advancing is the lack of flexibility in SEPTA’s capital budget. In discussions this week, the Federal Transit Administration raised concerns about whether SEPTA could fund its share of the project, which would include any cost overruns. SEPTA’s capital budget is constrained compared to peer transit agencies that have more state and local funding available. SEPTA would not jeopardize other critical projects, such as the Market-Frankford Line fleet replacement, Trolley Modernization, or station accessibility improvements, to advance an expansion project.

With each year of delay, the cost of KOP Rail increases by approximately $100 million. As inflation and higher interest rates have set in, those numbers accelerated further. From August 2020 to August 2022, the project estimate increased from $2.08 billion to $2.6 billion. The estimate now stands at $3.02 billion.

The pause halts all activities on KOP Rail. A contract approved last month for final design was not executed by SEPTA. The Authority will provide details on how funds allocated for KOP Rail will be used when the proposed capital budget and long-term program is released in April.

-via Press Release