The Southeastern Pennsylvania Transportation Authority (SEPTA) (hereinafter referred to as the Borrower) was established by legislation in 1963 and is responsible for the planning, acquisition, operation, construction, improvement, maintenance, and management of public transportation routes. In 1965, the Borrower merged with two predecessor agencies – the Passenger Service Improvement Corporation and the Southeastern Pennsylvania Transportation Company. In 1966, it began operating the Reading Company and Pennsylvania Railroad commuter lines. In 1983, it assumed the operating rights of Conrail and acquired tracks, vehicles, and other assets.
The Borrower is one of only two transportation authorities in the United States that manages all five major modes of transportation: buses, subways and elevated railways, commuter trains, light rail, and trolleybuses. At the same time, the Borrower also carries out maintenance, replacement, and expansion projects for public transportation infrastructure.
New Fare Collection System Project
Because the current fare collection system no longer meets the Borrower's needs, much of the existing equipment dates back to the 1920s, even predating the Borrower's system operations. A 2006 report on the current fare collection system showed that the Borrower's existing system was nearing the end of its service life. Maintenance of fare boxes and turnstile systems is limited by the availability of spare parts, and electronic and computer operating systems cannot be upgraded to current standards. Regional rail, special community transportation, and parking rely on manual procedures, which poses risks to revenue, and limits the conversion and reporting of effective ridership and revenue data. The ability to modify pricing policies, manage passenger behavior services, and implement mixed fares is constrained by insufficient system processing capabilities. Furthermore, the fare collection systems used vary by mode of transport, with very few systems being integrated.
Job Creation for the New Fare Collection System
VantagePoint, located in Philadelphia, is an independent consulting firm that provides financial and strategic management consulting to public, private, and non-profit organizations. VantagePoint's scope of business includes high-level strategic planning, financial policy with detailed financial analysis, data management, and project management. Its client base covers government, transportation, medicine, higher education systems, professional services, waste management, and non-profit organizations. The Borrower commissioned VantagePoint to conduct a feasibility study to evaluate the impact of capital investment and operational status on the local, regional, and Pennsylvania economies upon the completion of the new fare collection system.
Purpose of the Loan
Prior to the closing of the first unit sale in the first phase, the partnership will enter into a loan and security agreement (hereinafter referred to as the Loan Agreement) with the Borrower. Pursuant to the Loan Agreement, the loaned funds will be used for the new fare collection system program.
[Note]:
1. All project information is subject to the official offering documents;
2. EB-5 investment involves risks, and applicants should make independent judgments.
