The State of New Jersey was making token subsidy payments to the CNJ by 1962 or 63. Nothing close to covering the actual losses the CNJ was incurring on the commuter operations. They went into receivership in 1967, and both C&O/B&O and the N&W loaned (and sold) older power to them.
In 1972 the Chessie System sold their interest in the Reading to three businessmen from Chicago. They basically wiped their hands of the whole northeastern mess with that move, and at the same time, the CNJ came out with the Timpany red scheme (named for the new trustee).
The Commonwealth of PA had no direct rail-assistance programs at the time. The Passenger Service Improvement Corporation (formed in 1965, owned by the City of Philadelphia) was the only safety net for the RDG and PRR/PC in SE PA.. The PSIC had by 1976 turned into SEPTA, but whether or not they were covering the full losses of the two railroad serving the city, I don't know (but I doubt it!).
MJK
telephone, telegraph, and tell a railroader
-S.E. Miller