Congressional delegation should butt out

Congressional delegation should butt out

Focus on T’s retirement fund, not privatization efforts

HERE’S ONE THAT COULD BE A JOKE, except it actually happened.  Every member of Massachusetts’ congressional delegation recently thought it would be a good idea to sign a misguided letter to Gov. Charlie Baker and Secretary of Transportation Stephanie Pollack urging them to avoid saving money and improving service quality at the MBTA.

The letter chides state officials for not maintaining the decades-old monopoly imposed by the Commonwealth’s anti-privatization law when it comes to the MBTA’s bus maintenance operation.  “We as elected officials do not attempt to insert ourselves into the substance of collective bargaining between management and a bargaining unit,” they wrote, before proceeding to do exactly that.

The letter ignored the fact that because of a three-year exemption from the anti-privatization law, the T has come close to facing down a $250 million deficit.  That translates to more money invested in the core system—signals, switches, all the stuff that makes the trains and buses work better.  Is the delegation against that?

In 2015, the latest year for which data are available, the T once again had the highest maintenance costs in the nation per hour of bus operation.  Reducing those costs to the average of five “peer” agencies, as determined by a database partially funded by the Federal Transit Administration, would have saved about $44 million.

MBTA maintenance costs were more than 70 percent higher than the average of the five peers.  The T also had the highest vehicle maintenance labor salaries per hour of bus operations, again more than 70 percent above the average of its peers.

Outsourcing bus maintenance is a routine and growing practice throughout the transit industry, and most of the Commonwealth’s Regional Transit Authorities are among the agencies that do it.  Adding to the bizarreness of the delegation’s letter is the fact that the privatized workforce will almost certainly be unionized, as is the case at every RTA that purchases bus maintenance services.

A better use of the delegation’s time and energy would be to work on saving the MBTA Retirement Fund, which is at risk of insolvency.  The fund’s condition is far more important than the question of which union employees should maintain the buses.

About two thirds of T funding comes directly from taxpayers.  Whenever more money is needed to keep the MBTA Retirement Fund afloat, the T is responsible for providing three quarters of it.  Despite the fact that MBTA employer contributions have more than doubled over the last decade to $87 million annually, the pension’s unfunded liability has grown from less than $50 million in 2005 to over $1 billion today.

Unlike other state workers, MBTA employees are part of the Social Security system.  Among public entities that are part of Social Security, the MBTA Retirement Fund is almost unique in that it isn’t an “integrated” system, meaning that pension payouts are not reduced to account for retirees’ receipt of Social Security benefits.

With a $7.3 billion maintenance backlog and billions more in debt, the T basically faces three options: Cut service, raise fares once again, or enact reforms such as restructuring the MBTA Retirement Fund as an integrated Social Security/pension system with offsets that take pension benefits into account.

Meet the Author

Meet the Author

Massachusetts taxpayers would be far better served if, instead of seeking to score political points by urging state leaders to favor existing MBTA bus maintenance workers over their unionized private counterparts, members of the Commonwealth’s congressional delegation backed efforts that will stave off T service cuts and further fare increases.  Retirement system reforms are at the top of that list.

Jim Stergios is the executive director and Charles Chieppo is the senior media fellow at the Pioneer Institute, a free-market-oriented think tank. 

  • Euclidoris

    “…urging them to avoid saving money and improving service quality at the MBTA.”

    Come on, you know full well that is not what the intent of the letter was. If you are going to misrepresent the position of our elected officials, at least make it believable.

    “Adding to the bizarreness of the delegation’s letter is the fact that the privatized workforce will almost certainly be unionized”

    So it’s OK for taxpayers to fund out-of-state union workers, but not MBTA union workers. Got it.

    “Outsourcing bus maintenance is a routine and growing practice throughout the transit industry”

    Ah, the classic ‘everyone else is doing it!’ argument. Is that the best you can do?

    “A better use of the delegation’s time and energy would be to work on saving the MBTA Retirement Fund, which is at risk of insolvency. The fund’s condition is far more important than the question of which union employees should maintain the buses.”

    This is completely irrelevant to the argument against keeping the maintenance of buses within MBTA jurisdiction. Why not mention the MBTA’s abysmal capital spending record? Between routine maintenance for rail infrastructure and procurement of new vehicles, riders have endured delays and cancellations because of the agency’s inability to consistently meet demand for work to keep the system in a state of good repair. Perhaps the fact that there are no solutions offered in this article, simply complaints and grandstanding, is the reason you switched topics so suddenly. Who knows.

    “…members of the Commonwealth’s congressional delegation backed efforts that will stave off T service cuts and further fare increases.”

    That’s precisely what they were doing. The MBTA proposed severe cuts to The Ride, the paratransit service, as a means to balance the budget.

    Why should support for union workers in Massachusetts and opposition to service cuts be mutually exclusive? The assertion that our representatives are simply pandering to their Democratic base is rich in irony coming from a conservative think tank that supports privatization. Really, you deserve the Trump Award for Excellence in Hypocrisy.

    Is it really so outrageous to suggest that the MBTA employ the same negotiation tactics that were successful with the largest train and bus operator union? Why is it acceptable then but not now?

    You want the MBTA to focus on reforming reforming the pension fund, yet you make no recommendations other than simply, “Enact reforms such as restructuring the MBTA Retirement Fund as an integrated Social Security/pension system with offsets that take pension benefits into account”

    Nowhere do I see support for moving the fund to Mass PRIM’s authority, as is the case with the vast majority of public retirement boards in the commonwealth. Are you opposed to unionized workers, or just any public agency in general? It would seem to be the latter, in which case I can see your partisanship from here.

    I’m glad to see that this publication respects your institution enough to publish your thoughts on the matter, because everyone else in the state thinks your partisan ways are a joke.

  • Euclidoris

    “…urging them to avoid saving money and improving service quality at the MBTA.”

    Come on, you know full well that is not what the intent of the letter was. If you are going to misrepresent the position of our elected officials, at least make it believable.

    “Adding to the bizarreness of the delegation’s letter is the fact that the privatized workforce will almost certainly be unionized”

    So it’s OK for taxpayers to fund out-of-state union workers, but not MBTA union workers. Got it.

    “Outsourcing bus maintenance is a routine and growing practice throughout the transit industry”

    Ah, the classic ‘everyone else is doing it!’ argument. Is that the best you can do?

    “A better use of the delegation’s time and energy would be to work on saving the MBTA Retirement Fund, which is at risk of insolvency. The fund’s condition is far more important than the question of which union employees should maintain the buses.”

    This is completely irrelevant to the argument against keeping the maintenance of buses within MBTA jurisdiction. Why not mention the MBTA’s abysmal capital spending record? Between routine maintenance for rail infrastructure and procurement of new vehicles, riders have endured delays and cancellations because of the agency’s inability to consistently meet demand for work to keep the system in a state of good repair. Perhaps the fact that there are no solutions offered in this article, simply complaints and grandstanding, is the reason you switched topics so suddenly. Who knows.

    “…members of the Commonwealth’s congressional delegation backed efforts that will stave off T service cuts and further fare increases.”

    That’s precisely what they were doing. The MBTA proposed severe cuts to The Ride, the paratransit service, as a means to balance the budget.

    Why should support for union workers in Massachusetts and opposition to service cuts be mutually exclusive? The assertion that our representatives are simply pandering to their Democratic base is rich in irony coming from a conservative think tank that supports privatization. Really, you deserve the Trump Award for Excellence in Hypocrisy.

    Is it really so outrageous to suggest that the MBTA employ the same negotiation tactics that were successful with the largest train and bus operator union? Why is it acceptable then but not now?

    You want the MBTA to focus on reforming reforming the pension fund, yet you make no recommendations other than simply, “Enact reforms such as restructuring the MBTA Retirement Fund as an integrated Social Security/pension system with offsets that take pension benefits into account”

    Nowhere do I see support for moving the fund to Mass PRIM’s authority, as is the case with the vast majority of public retirement boards in the commonwealth. Are you opposed to unionized workers, or just any public agency in general? It would seem to be the latter, in which case I can see your partisanship from here.

    I’m glad to see that this publication respects your institution enough to publish your thoughts on the matter, because everyone else in the state thinks your partisan ways are a joke.

  • CharlieBakersFish

    Perhaps these clowns should just continue to line the pockets of Trump and they should butt out of “PUBLIC TRANSIT” since it is funded by the tax payers.

  • Stephen Graves

    This from the Baker founded Pioneer Institute. Which he and his father founded back when then Governor Weld was exposed for his lies about the “savings ” of privatization. They may be considered an”independent ” think tank, but definitely not impartial!

  • c squared

    The funny thing Charlie and Jimmy here say the congressional delegation should butt out maybe they should follow their own advice. They feel the need to as they put it “butt in “. Why should we pay attention to them. Their so called studies are funded by the people who stand to gain these private contracts . Follow the money trail back.They claim to be non partisan what a joke.

  • CharlieBakersFish

    We know that Baker and his henchmen want to just profiteer off the back of the tax payers. Just look at people at the people running the T these days.

  • Euclidoris

    “…urging them to avoid saving money and improving service quality at the MBTA.”

    Come on, you know full well that is not what the intent of the letter was. If you are going to misrepresent the position of our elected officials, at least make it believable.

    “Adding to the bizarreness of the delegation’s letter is the fact that the privatized workforce will almost certainly be unionized”

    So it’s OK for taxpayers to fund out-of-state union workers, but not MBTA union workers. Got it.

    “Outsourcing bus maintenance is a routine and growing practice throughout the transit industry”

    Ah, the classic ‘everyone else is doing it!’ argument. Is that the best you can do?

    “A better use of the delegation’s time and energy would be to work on saving the MBTA Retirement Fund, which is at risk of insolvency. The fund’s condition is far more important than the question of which union employees should maintain the buses.”

    This is completely irrelevant to the argument against keeping the maintenance of buses within MBTA jurisdiction. Why not mention the MBTA’s abysmal capital spending record? Between routine maintenance for rail infrastructure and procurement of new vehicles, riders have endured delays and cancellations because of the agency’s inability to consistently meet demand for work to keep the system in a state of good repair. Perhaps the fact that there are no solutions offered in this article, simply complaints and grandstanding, is the reason you switched topics so suddenly. Who knows.

    “…members of the Commonwealth’s congressional delegation backed efforts that will stave off T service cuts and further fare increases.”

    That’s precisely what they were doing. The MBTA proposed severe cuts to The Ride, the paratransit service, as a means to balance the budget.

    Why should support for union workers in Massachusetts and opposition to service cuts be mutually exclusive? The assertion that our representatives are simply pandering to their Democratic base is rich in irony coming from a conservative think tank that supports privatization. Really, you deserve the Trump Award for Excellence in Hypocrisy.

    Is it really so outrageous to suggest that the MBTA employ the same negotiation tactics that were successful with the largest train and bus operator union? Why is it acceptable then but not now?

    You want the MBTA to focus on reforming reforming the pension fund, yet you make no recommendations other than simply, “Enact reforms such as restructuring the MBTA Retirement Fund as an integrated Social Security/pension system with offsets that take pension benefits into account”

    Nowhere do I see support for moving the fund to Mass PRIM’s authority, as is the case with the vast majority of public retirement boards in the commonwealth. Are you opposed to unionized workers, or just any public agency in general? It would seem to be the latter, in which case I can see your partisanship from here.

    I’m glad to see that this publication respects your institution enough to publish your thoughts on the matter, because everyone else in the state thinks your partisan ways are a joke.

  • QuincyQuarry.com

    I just happened to have spent some of this past Saturday helping a friend learn how to trim roses bushes in his yard.

    Oh, and my friend just happens to be a senior auditor type in State Auditor’s office.

    We, in turn, eventually got around to taking about the T. Confidences limit what could then be shared or can now be shared, but it’s still safe to suggest that there is still more than a bit fat that can be trimmed in some areas of the T’s operations as well as costs that can be reduced by merely doing things just less ineffectively that what has often long been done to date.

    For example, a lot of the employees at the T work hard – but not all of them nor are those who do work hard necessarily well-utilized. Be sure to note that no small part of this problem is one of mismanagement.

    In short, trim the fat as well as better utilize those who want to put in a honest day’s work effectively and it will be amazing what could result.

    • QuincyQuarry.com

      Oh, and as for the MBTA’s pension, as underfunded as it is, it could be worse. For example, it could be as underfunded as is the woefully underfunded City of Quincy employee pension fund. Quincy’s actuarial shortfall on its city employee pension obligations have GROWN on both percentage and dollars bases even as the stock market has both recovered and then soared to new all time record highs in the wake of the Crash of 2008.