More hurdles for bus maintenance outsourcing

More hurdles for bus maintenance outsourcing

Internal reforms showing promise, past privatization efforts struggling

THE MBTA’S POLITICALLY CONTROVERSIAL PLAN to outsource three bus maintenance garages encountered more obstacles on Monday as the agency grappled with negative fallout from two past privatization efforts and learned internal reforms at some garages appear to be yielding significant savings and improved operations.

The T put out a request for proposals to operate three bus maintenance garages in Lynn, Quincy, and Jamaica Plain in July, but only one company, First Transit, submitted a bid. First Transit has a checkered history in Massachusetts after walking away from a contract to operate the T’s paratransit service. The Cincinnati-based company ultimately reached a $7.3 million settlement with the attorney general to resolve the issue.

Democratic lawmakers from Beacon Hill and Congress, siding with union members who work at the garages, have repeatedly called on the T to back off its plans to privatize the facilities. Sen. Marc Pacheco of Taunton led the charge on Monday at a meeting of the T’s Fiscal and Management Control Board, telling the control board it would be “outrageous” to hire First Transit. Rep. Tackey Chan of Quincy gave the board a letter signed by 46 lawmakers raising concerns about the T’s contracting process and demanding all correspondence between the T and First Transit during the paratransit contract negotiations and the more recent bus maintenance negotiations.

“With past privatization efforts leading to downgrades in service and travel, this measure represents a dismal step backwards in the quality of service to be received by daily users of the MBTA,” the letter said.

T officials have refused to back off their privatization strategy, saying they are pursuing a three-pronged strategy of outsourcing, internal management reforms, and concessions from the union representing bus maintenance workers.

Despite the T’s stay-the-course pronouncements, privatization of the three bus maintenance garages appeared to take a hit on Monday as the T grappled with two past outsourcing initiatives that haven’t gone smoothly. The T on Friday decided to officially part ways with Global Contact Services, a company hired to manage rides for customers with disabilities. MBTA General Manager Luis Ramirez said the agency decided to dump Global now but retain the firm’s services until June when the T expects to transition to a new vendor.

The T had hoped Global, which was hired to consolidate three call centers into one, would save the agency $1 million during the current fiscal year. Instead, T officials said, the paratransit contract is running $13 million over budget and problems with pickups and drop-offs have continued.

A second contract with Republic Parking of Tennessee to manage the T’s parking garages and lots is also stirring concern after the agency’s director of parking abruptly resigned and sent a 30-page statement to managers detailing poor management oversight of the vendor.

Joseph Aiello, the chairman of the control board, on Monday acknowledged some “hiccups” with the T’s oversight of Republic. He asked T managers to deliver a presentation on the lessons that can be learned from the Global fiasco and any problems that might be occurring with the Republic contract.

“A lot of these things happened on the board’s watch,” Aiello said.

The argument for privatization of the bus maintenance garages also was weakened somewhat by a presentation to the control board on successful internal efforts to implement management and workplace reforms at the Cabot and Charlestown bus maintenance garages and the Everett repair shop.

The T is counting on $8 million in bus maintenance savings this fiscal year and a total of $21 million over the course of an entire year. T officials said the $8 million savings target is within reach, but indicated they may fall short of the annualized target, in part because repair costs are likely to rise as some newer buses come off warranty and some of the workforce reductions have been accomplished by transferring employees to other garages.

Still, employment at all of the T’s bus maintenance garages has fallen from 516 to 482, and new internal reforms at the Cabot and Charlestown garages in Boston and the Everett repair shop are improving operations while driving down costs. Progress is occurring even as maintenance workers are contending with outdated and broken equipment.

Bill Griffiths, the T’s senior director of fleet maintenance and strategy, highlighted situations where repair lifts didn’t work properly and fluid dispensing systems were broken. Griffiths said workers often had to roll over 55-gallon drums of oil to their work stations and pump fluids into buses manually. At the Everett repair shop, Griffiths said, T employees, with the help of outside consultants, threw out 220 tons of obsolete materials that were no longer needed.

Griffiths said the T, when it recently purchased new Red and Orange Line cars, spent money readying the existing maintenance shops to accommodate the new vehicles. “I don’t think we’ve done that on the bus side at all,” he said.

Ramirez, the T’s general manager, appeared shocked at the condition of some of the bus maintenance facilities. “I find it appalling that we have some of these situations,” he said.

Brian Shortsleeve, a member of the control board who has been a strong advocate for privatization initiatives, said the T should continue to pursue internal reforms, to explore outsourcing options, and to work with its unions to find savings.

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Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

“It’s great to see the progress,” Shortsleeve said of the report from Griffiths. “But I think it indicates that we’re scratching the surface when it comes to how much opportunity there is to save money.”

Shortsleeve said the fact that just one company bid on the bus privatization contract doesn’t deter him. “We’ll see where industry stands,” he said. “But competition is a good thing. It will enable us to understand what industry can deliver versus our current numbers, which are trending the right way. This is the first year in which bus maintenance costs have gone down in 15 years, independent of fleet age. Bus maintenance costs have always gone up, even when the fleets were newer. This indicates the T is getting really serious about driving productivity. It’s great.”