MBTA: What went wrong and how to fix it

T Advisory Board picks the minds of a bunch of experts

THE MBTA Advisory Board, the group representing cities and towns in the transit authority’s service area, held a series of fascinating panel discussions on Tuesday on the future of the MBTA. What follows is a Q&A explainer based on those presentations.

Q: Let’s start with funding. Everyone seems to agree the T is underfunded. How did that happen?

A: Andrew Bagley, vice president for policy and research at the Massachusetts Taxpayers Foundation, said it started in 2000, when a blue ribbon commission sought to solve the MBTA’s revenue problems by giving the transit authority a dedicated revenue stream from the state sales tax. Sales tax revenues had grown at a 5 to 7 percent rate in the previous decade, so the committee thought the flow of money would be sufficient. Unfortunately, revenues grew at only 1 percent a year until fairly recently.

Q: How did the T cope with the lower amount of revenue?

A: According to Bagley, the MBTA initially cut the size of its capital budget and raised money by issuing bonds securitized by parking revenues. “What you have left are fare hikes,” Bagley said. “Fare hikes are so unpopular that we would see five to seven years transpire before there was agreement on the fare hikes, and some of those were substantial.”

Q: What’s the MBTA’s current financial predicament?

A: Bagley said expenses are growing at twice the rate of revenues, which have been hurt by COVID and the downturn in fare income. Federal funds and rising sales tax revenues have helped close the T’s budget gap the last couple years, but those solutions are running out. He is predicting a shortfall in the operating budget of $200 to $250 million in fiscal 2024, growing to $500 million in fiscal 2026.

Bagley said the capital budget is facing a similar future. The most recent numbers available suggest the MBTA needs to spend $25 to $27 billion on capital projects over the next 10 years just to maintain the existing system, but the transit authority can afford only about half that amount.

Q: What’s the solution?

A: In pure dollars-and-cents terms, Bagley says the state needs to find a revenue stream for the MBTA that is substantial and grows at least 3 percent a year. Expenses are on the rise. The T is trying to hire 2,000 more people at a cost of roughly $150 million a year, Bagley said. South Coast Rail and the Green Line extension are coming on line, with an operating cost of $30 to $40 million a year.

Q: Does the Legislature have any funding ideas?

A: Sen. Brendan Crighton of Lynn, the co-chair of the Legislature’s Transportation Committee, expressed interest in mobility pricing but shied away from getting into specifics. “There isn’t a silver bullet here,” he said. The senator does feel that riders cannot be asked to pay more, and should probably pay less. He favors instituting means-tested fares, or fares based on the income level of the rider. “My view is we can’t do it on the backs of the riders,” he said.

Q: Are any other revenue options being pushed?

A: Yes. Tim Murray, the president of the Greater Worcester Regional Chamber of Commerce and the former lieutenant governor, said he likes an idea put forward in CommonWealth by Jim Aloisi, the former state transportation secretary, who said the state should pick up half of the T’s $500 million-a-year debt service cost. Whatever funding mechanisms are selected, Murray said, the package needs to be comprehensive. “If we half-step this, we’re going to continue to have this discussion,” he said.

Q: Many people are clamoring for a better MBTA, but will Massachusetts residents support a major investment in transit?

A: Question 1 on the ballot would impose a surtax on income over $1 million that would go for transportation and education.

Q: Is more funding necessary?

A: Chris Dempsey, a transportation expert who recently mounted an unsuccessful bid for state auditor, said the incentives associated with transportation in Massachusetts need to shift. Over the last 31 years, he said, Massachusetts raised the gas tax 3 cents, or 14 percent. Over that same time period, he said, the MBTA raised commuter rail fares 250 percent. “The message we have sent to the people of Massachusetts over the last 30 years is drive more and take transit less. And people have responded to that message,” he said.

Q: Are some communities incentivizing transit properly?

A: According to Dempsey, New York collects tolls to cross major bridges and uses the proceeds to support transit. London has a similar approach, assessing fees on people who drive into the inner core of the city and using the money to help pay for transit. “We basically do the opposite here, where we don’t really ask drivers to pay for the costs that they impose on others,” Dempsey said.

Q: What kind of timetable is needed on finding a transportation funding solution?

A: Bagley said 46,000 people left the state last year, many of them turned off by the high cost of housing, congestion, child care, and on and on. He worries that unless riders start returning to the MBTA the situation will continue to deteriorate. “We’re going to have to talk about this pretty soon or we’re going to find out that people just don’t want to use our transportation system to live here,” “he said.

Q: Is the Legislature ready to act?

A: Crighton said 2023 has to be the year that the MBTA’s revenue problems are addressed. He also said the Legislature needs to find a way to promote regional equity, so all parts of the state, and not just eastern Massachusetts, benefit.

Q: Last Friday, Sen. Elizabeth Warren called for a top-to-bottom shakeup in the management of the MBTA. Did that come up during any of the panel discussions?

A: No. The solutions talked about were broad and systemic. Fred Salvucci, the former state transportation secretary, characterized the situation this way. “The central problem with the MBTA is that the dedicated funding was mis-estimated back in the year 2000,” he said. “The organization has not had enough money to properly maintain its assets, and if that’s not fixed it doesn’t matter what board structure or board manager you put in place. That has to get fixed.”

Q: Give me a little history lesson on MBTA leadership?

A: Dan Grabauskas, who served as the T’s general manager and then secretary of transportation from 2003-2009, said during his tenure the general manager ran the T and reported to a board appointed by the governor. He said the MBTA Advisory Board had significant authority as well, including the power to veto the T’s budget or cut – but not increase – individual line items.

Q: What happened after that?

A: The Legislature abolished the T board and combined its duties with those of the Massachusetts Department of Transportation board in a bid to streamline the bureaucracy.

Q: How did that work out?

A: According to Joe Aiello, who headed the T’s Fiscal and Management Control Board from 2015 until 2021, abolishing the T board was a mistake that accelerated a 20-year pattern of underinvestment in the MBTA and led to the collapse of the transit system during the 2015 snowmageddon. That collapse ushered in the Fiscal and Management Control Board, which was charged with taking a hands-on approach to overseeing the T. It was required to meet three times a month.

“We struggled to find a general manager,” Aiello said. “We had several interim general managers. We had one failed search for a general manager. We had a general manager that was a misfit between that person’s skills and what happened.”

Aiello said the board turned to Steve Poftak, the deputy chair of the control board, to fill the general manager position starting in 2019. “He took measures around safety immediately,” Aiello said. “He replaced the director of safety. He understood that that was a malignant problem at the T. “

Aiello said Poftak also collaborated with the outside safety panel headed by former US transportation secretary Ray LaHood that was brought in in 2019 to review safety procedures at the T. That panel concluded safety was a major problem, and Aiello said Poftak began addressing the situation. “He was beginning to make headway on safety when all of a sudden COVID comes and obviously changes the dynamic on how quickly you can change the culture and change the protocols,” Aiello said.

Q: The current MBTA board was created in 2021. It meets once a month and has adopted a more hands-off attitude. Is that working?

A: Aiello said he thinks the shift to a new board was premature. He said the new board needs to be more active, perhaps not as active as the Fiscal and Management Control Board – but active. “The place is still in crisis,” he said.

Q: What kind of oversight does the T need now?

A: There are lots of theories, but Aiello, Salvucci, and Grabauskas seemed to favor a board of largely gubernatorial appointees. Aiello says the MBTA needs a very strong general manager. Salvucci said he thinks the powers that were stripped from the MBTA Advisory Board should be restored and possibly strengthened, giving the advisory board the power to not only cut spending but increase it.

Q: What did the panelists think of the division within the state Department of Public Utilities charged with making sure the MBTA follows its safety protocols. The Federal Transit Administration, in its recent safety report, raised questions about its effectiveness and its independence.

A: The consensus seemed to be that the DPU division isn’t adequately staffed and has failed to do its job. Aiello said the LaHood safety panel came in to review safety issues at the T in 2019 and the DPU division was “completely unresponsive.” He added: “The safety function within the DPU is just a lost child.”

Q: What should be done with the DPU division?

A: Grabauskas, Salvucci, and Aiello seemed inclined to staff it up and move it elsewhere in the government bureaucracy. None of them thought incorporating it into the Department of Transportation was a good idea. (“There’s too many perceived and real conflicts of interest,” Aiello said.) Salvucci suggested putting the division under the oversight of the MBTA Advisory Board.

Q: While all the problems at the MBTA are being addressed, should expansion plans be put on hold?

A: Bagley said expansions to a core that isn’t working won’t accomplish much. He likened the situation to the last-place Red Sox trying to rebuild for next year. “It better be a good offseason,” he said.

Dempsey said the MBTA needs to improve its base operations and expand. “But I do think we need to be cautious,” he said.

Q: Any other thoughts?

A: Jascha Franklin-Hodge, the chief of streets in Boston, said expansion is necessary because continuing to fill streets and highways with cars is no longer possible. “There is no pathway to growth that involves dramatic expansion of traffic on our roads,” he said.

Q: As the MBTA regroups, what mode of travel should the agency focus the most attention on?

A: “The clear answer to that question is bus,” Dempsey said. “We do not pay nearly enough attention to bus riders. We give them the worst quality service and yet they are some of our most loyal customers.”

Dempsey said he is optimistic about bus service because it’s flexible to deploy and relatively inexpensive. “I would suggest it is also a way to connect cities,” he said.

Q: Did any of the other people on the panels have a suggestion?

A: Somerville Mayor Katjana Ballantyne called for a change in attitude among state leaders. “I want to be able to hear that our leadership in the state of Massachusetts says they want Massachusetts to have a world-class public transit system. I haven’t heard that.”

Q: Did any political candidate show up for the panel discussions?

A: Kim Driscoll, the mayor of Salem and the lieutenant governor running mate of Maura Healey, kicked off the panels with a brief presentation of her own. She appeared to be quite knowledgeable, raising the possibility that if the Democrats win the corner office next month she might play a transportation role in the new administration.

“Transportation needs to be about investing for the next generation, things we’ll never cut the ribbon on,” she said. “I’m hopeful to be in a position to influence it.”