SEPTA’s former CEO Leslie Richards will keep getting paid in 2025 for ‘transition services’

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Leslie Richards is no longer the top brass at SEPTA, but the former executive is still getting paid, according to her contracts obtained by WHYY News.

In October 2024, SEPTA announced that Richards would be stepping down from her role as CEO in November 2024.

But the employment termination agreement shows Richards will be paid $436,722 until November 2025. In addition, she’s eligible for six months of job placement services and 384 hours of unused vacation time.

SEPTA inked its first contract with Richards in October 2019 for her to begin in January 2020. Richards earned $329,732 each year until January 2023. And if she was terminated before the contract expired, she would be owed the remaining balance.

The contract also included a SEPTA-provided vehicle and parking space at its Center City headquarters and commuter regional rail station, plus six weeks of paid vacation, pension and a performance bonus process.

In May 2023, SEPTA’s board reappointed Richards as CEO with a new contract set to expire in January 2027. The terms of the deal changed; if her employment were terminated, she would only be entitled to 12 months of her salary.

But her salary was bumped up to $425,000, with the potential for additional performance and retention bonuses worth another $220,000 if goals were met. That means she could have earned $645,000 by the end of 2025.

Some of Richards’ performance goals included launching the new SEPTA app by March 2024, improving customer survey results, reducing costs by $64.7 million through SEPTA’s efficiency and accountability program, winning  $100 million in grants, increasing SEPTA Key Advantage customers to 75,000 from 30,000, increase ridership and improve on-time performance, reduce crimes by 3%, curb accidents, employee injuries and rail derailments.

Kevin Murphy, professor of finance and business economics at University of Southern California Marshall, said the CEO contracts appeared to be standard for the industry – but that her leaving appears to be a termination rather than a resignation.

“It looks to me like they are just living up to that contract, it would be consistent with a separation that was led by SEPTA and not by her,” Murphy said. “That doesn’t sound to me like you can’t fire me, I quit. This sounds more like you, can’t quit, you’re fired. This is a termination.”

Richards did not respond to a request for a news interview for this story.

Charles Elson, founding director of the Weinberg Center for Corporate Governance and retired professor at the University of Delaware agreed with Murphy.

“A year’s salary is effectively a severance, they can label it transition, they can say she’s consulting, that’s not unusual,” Elson said.

The separation agreement details a joint non-disparagement agreement between SEPTA’s board and the former CEO.

Richards served as the CEO of SEPTA for five years, spearheading the organization through the COVID-19 pandemic that prompted much of its commuter ridership to stay home and work remotely. She led 9,500 employees at the agency. In addition, she was permitted to teach one course per semester as an adjunct professor.

She oversaw a bus network redesign, the transit agency’s Key Advantage system and brokered a deal with the state to secure $51 million of the expected $161 million funding SEPTA needed to keep operating.

But SEPTA was rapidly facing a fiscal cliff until Pennsylvania Gov. Josh Shapiro stepped in and reallocated $153 million of transportation project funding to stave off insolvency until June 2025.

In December 2024, Richards stepped into an expanded role as a professor of practice in the Department of City and Regional Planning at the University of Pennsylvania’s Weitzman School of Design.

Any leftover funds previously allocated for the CEO’s salary go back into SEPTA’s operating budget.

“Employee salaries and related expenses are paid for in SEPTA’s operating budget, which covers everyday expenses such as labor, fuel and power,” said Andrew Busch, spokesperson for SEPTA. “We have a separate capital budget, but those funds are specifically for maintenance and improvement projects.”

It was not immediately clear how much the interim CEO, Scott Sauer, who was previously the chief operating officer at SEPTA is paid in the new role. He earned about $288,600 as chief operating officer.

SEPTA is undergoing a nationwide search for its next CEO. The typical cost for executive recruitment could be between six months’ to a year’s salary of the role, Elson estimated.

SEPTA has also paid higher salaries than some of its larger peer transit agencies.

The NYC Metropolitan Transportation Authority CEO Janno Lieber earns $400,000. And Kris Kolluri overseeing New Jersey Transit is paid $280,000.

The highest-paid  transportation agency CEO nationwide is Washington Metropolitan Area Transit Authority’s Randy Clarke, with a $485,000 annual salary. The Los Angeles County Metropolitan Transportation Authority’s CEO Stephanie Wiggins earns $456,400.

This isn’t the first time SEPTA has paid former executives after they’ve left, Robert Lund Jr. was paid $297,076 in 2022, an investigation by the Philadelphia Inquirer discovered.