perhaps he can revolutionize the MBTA.
When Dan Grabauskas left the Registry of Motor Vehicles in 2002 to run, unsuccessfully, for state treasurer, Stephen Doody, his chief of staff, signed on as campaign manager, living on a $500-per-week stipend and no health insurance. Now a business development consultant, Doody has no regrets. “I believed in Grabauskas, lock, stock, and barrel,” he says.
He’s not the only one. Boston Mayor Thomas Menino lauds Grabauskas’s professionalism. Sen. Susan Tucker, an Andover Democrat, who worked with Grabauskas on Registry reform, says, “I believe that he is one of those rare public managers who blends bipartisanship, good leadership, and management skills to get results.”
Now, as general manager of the MBTA since May 2005, Grabauskas even gets praise from an unlikely source: the often-combative Boston Carmen’s Union. Steve MacDougall, president and business agent for the T’s largest labor group, and other union leaders sat down with the general manager shortly after his arrival. Grabauskas heard employee complaints about dilapidated facilities with leaking roofs—and restrooms with broken toilets, sinks, and a shortage of hand towels—and he immediately ordered repairs. The unions aren’t accustomed to that kind of responsiveness from management, says MacDougall.
But it isn’t his ability to make friends that got Grabauskas the T’s top job, one that he stepped down from an even bigger job (state secretary of transportation) to take. It was his transformation of the Registry, once the state’s most notorious outpost of bureaucratic Neanderthalism. If Grabauskas could turn the RMV into a public sector exemplar, he can revolutionize the MBTA. Or so his fans are hoping. Behind the accolades are great expectations—and, for Grabauskas, plenty of risks.
“The RMV was triple-A,” says Doody, referring to baseball’s hierarchy of leagues. “The MBTA is the big leagues.”
Indeed, Grabauskas has his hands full at the nation’s fifth busiest transit authority. He must balance restoring fiscal stability at a debt-racked agency with political pressures to expand the network of trains, subways, and buses in every direction. Then there is the matter Grabauskas himself considers job one: getting the system into a “state of good repair,” transit-speak for addressing maintenance, repair, and replacement issues that have long been neglected.
And not a moment too soon. Many riders are mad as hell about problems ranging from service snafus to employee rudeness. Some of them say they aren’t going to take it—or the MBTA—anymore.
Will the miracle worker of the Registry be able to transform the T into a model transit agency—one that is efficient, customer-friendly, and able to satisfy demands from all quarters? Or has Dan Grabauskas, public sector fix-it man, finally met his match?
TAKING CHARGE
“Millions of people interact with the Registry each year—not by choice—but because it is required by law,” Grabauskas said in statement shortly after his September 1999 arrival at the troubled agency. That people had to do business with the Registry whether they liked it or not gave the agency no reason to reduce long lines and improve gruff service. The RMV had become a political liability for then-Gov. Paul Cellucci, and a Lawrence Eagle-Tribune series, based on a six-month investigation, detailing the interminable waits at the Registry (originally denied by RMV officials) helped prompt the resignation of then-Registrar Richard Lyons. The governor “needed somebody to fix it, and Dan Grabauskas’s name kept coming up,” says Doody.
Grabauskas was named head of the Registry the same week the Legislature’s Joint Committee on Public Safety recommended a slate of reforms, including longer office hours and improved staffing, following its own investigation of RMV excesses. Declaring zero tolerance for business as usual, Grabauskas worked with customers at RMV offices, listened to complaints on a radio call-in program, spearheaded computer network upgrades, and replaced senior administrators many employees thought were untouchable—a move Doody calls “the shot heard round the Registry.” By February 2001, most customers were served within 20 minutes, down from an hour or longer.
But using the MBTA is a choice, not a legal obligation, and riders are voting with their feet. Current weekday ridership is between 1.1 million and 1.2 million, but The Boston Globe reported in August that about 100,000 fewer people are now riding the T on a typical weekday than in 2000. Grabauskas blames the still-sluggish economy and other factors, but transit advocates say the hemorrhaging will continue if system improvements do not materialize.
“If the MBTA continues down the track that they’ve been going of increased fares, decreased service, [and] failing maintenance, people are going to continue to flee the system,” says Jeremy Marin, an associate regional representative of the Sierra Club.
your employees into being nice.”
And many transit riders are skeptical that Grabauskas, or anyone else, can tame the T. In September, the MBTA held a public meeting regarding transportation services for seniors and people with disabilities, as part of an 18-month service assessment by transit accessibility consultants. At the meeting, transit officials give a rundown of the good news: 180 of 280 rail stations are accessible to the disabled; older buses will be replaced with nearly 770 state-of-the-art vehicles; and a new computer scheduling system for The Ride, a door-to-door service for more than 65,000 riders with disabilities, is online. But most of the nearly 70 attendees pile on with complaints about rude drivers, transportation arriving too early or too late, and out-of-service elevators forcing some riders with disabilities to reboard trains, find an accessible stop, and backtrack to their original destinations.
“This is hogwash,” says 74-year-old Somerville resident Marjorie Francis as she strides to the podium, ignoring a microphone held by a T official. “Mr. Grabauskas may be doing well, but talk is cheap. [He] is new, [but put] a good apple in a barrel with rotten apples and what happens?”
The T officials put on their best game faces, jot notes, but do not respond to her comments or any other individual comments. Afterward, Francis says she doesn’t expect any changes. “Mr. Grabauskas needs to clean house,” she says.
And the housecleaning has begun.
The general manager is sitting in his office, dutifully answering questions about himself and where he wants to take the transit authority, when an aide hands him a sheet of paper. He briefly studies the words and gives his approval. He says nothing at the time, but the contents of that paper, the aide later confirms, are reflected in a small item in The Boston Globe the next day announcing the firing of chief operating officer Anne Herzenberg, a 21-year MBTA veteran. Herzenberg, who declined to comment for this story, is the first senior manager dismissed by Grabauskas. Later, asked if other personnel changes are in the offing, Grabauskas responds, “Oh yeah,” and nods his head.
“I don’t care how you got here or who your patron is. If you are willing to work and take on the responsibility of the new way we are trying to do things, then we are happy to have you aboard,” says Grabauskas. “But if you aren’t cutting it or working hard, then you’ll be gone.”
The general manager’s admirers say that behind his affable demeanor is a demanding taskmaster, one who is unlikely to put up with the MBTA status quo. “His absence of institutional knowledge, in my view, can be a huge plus to turn this organization around,” says union chief MacDougall.
“Broken,” “dysfunctional,” and “rife with cronyism”—these are words typically used to describe the MBTA’s organizational culture, where many employees expect to outlast general managers. The T is a “punishment-centered bureaucracy,” steeped in penalties, not solutions, says former employee Ellin Reisner, a sociologist by training, who worked as an assistant to former general manager John Haley and in various other positions. There are many talented people at the agency who do not feel able to contribute, says Reisner, now with the Somerville Transportation Equity Partnership. “I had an operator say to me once, ‘I come to work; I drive a bus. I have a brain, but nobody is interested.’”
Grabauskas concedes that “there is not a lot of trust from one level of bureaucracy to the next.” He says he aims to decentralize authority among his nearly 6,000 employees.
Front-line morale is poor, confirms MacDougall, and that contributes to problems between riders and employees in stressful situations. From January to June 2005, employee rudeness consistently outranked late service in complaints directed to MBTA Customer Relations.
“You cannot intimidate your employees into being nice,” says MacDougall. “[But] that has been the philosophy of the MBTA for a thousand years.”
MBTA employees, especially bus drivers, are in situations that are impossible to begin with, says Khalida Smalls, program director for the T Riders Union, a group formed by Alternatives for Community & Environment (ACE) that claims more than 500 members. Smalls says that riders and drivers “take their frustrations out on each other when they are angry about something that neither of them have any control over, because they are not the ones [determining] how often the bus should run or how many buses should be on that particular route.”
Grabauskas understands that it is management’s responsibility to equip MBTA employees with the skills to interact with “everybody from paupers to princes,” he says. He sees a window of opportunity to provide improved customer service training with the new automated CharlieTicket/ CharlieCard fare collection system, currently in use on the Silver and Blue lines and scheduled for expanded systemwide deployment in 2006. So far, not all has gone smoothly. There has been a spate of assaults on newly trained Blue Line customer service agents by would-be fare evaders, problems with malfunctioning gates, and complaints about difficulties in depositing currency and bills in the new bus fareboxes. But Grabauskas is convinced that moving the former fare collectors out of their stuffy, unfriendly, bulletproof boxes to help riders navigate the new system will improve customer relations.
STATE OF DISREPAIR
Still, more face time with customers will mean nothing if breakdowns and delays thwart the best-laid travel plans—and if the T mishandles the bottlenecks that do occur.
During rush hour on a late September morning, a homeless man survives being hit by an outbound Red Line train at Park Street Station in downtown Boston, halting service on the system’s busiest subway line. Four stops away in Cambridge at Harvard Station, inbound passengers whisper about what they’ve been told is a “medical emergency” downtown and continue to pack the platform despite hazy, blue smoke wafting through the tunnel—later found to be caused by a small trash fire along the rails. No T official appears to take charge of an inbound platform jammed with people waiting for trains that are not coming, but a fare collector continues to sell tokens to newcomers, including parents pushing children in strollers.
Some commuters exit the station in search of fresher air and some other way to get where they’re going. At a bus stop in front of Harvard Yard, another crowd waits for the Red Line replacement shuttle buses that are now rumored to be coming. But with no shuttles in sight, getting to Park Street Station boils down to a choice between two scheduled bus routes to gain access to the Green Line.
Grabauskas says reliability, or the lack thereof, is the number one complaint he personally hears from T passengers. Achieving reliability is fundamentally a matter of getting the 100-plus-year-old transit system into a state of good repair, and that’s a topic that animates Grabauskas. He darts from his chair to point out a section of track displayed on a nearby table. It is engraved with a purchase date of 1913. Installed on the Green Line’s C branch two years later, it was removed in October 2005, when the T replaced three miles of track along the 4.6-mile-line.
In fiscal 2006, the authority will spend $352.5 million on total maintenance needs. But the MBTA’s backlog of deferred maintenance, repair, and replacement projects totals $2.7 billion; the transit authority would have to spend an estimated $450 million each year just to keep from falling further behind, according to MBTA data cited in a March 2005 report of the Transit Subcommittee of the state’s Transportation Finance Commission—a 13-member body created by a 2004 state law to develop long-range financing plans for all modes of transportation.
Over the next five years, the T will spend millions of dollars replacing elevators and escalators, upgrading signals and switches between JFK/UMass and Park Street stations on the Red Line, and renovating numerous stations. Then there is the “abysmal” public address system—Grabauskas likens it to “Charlie Brown’s teacher”—that is slated for overhaul. Told by his staff that PA upgrades in major subway stations would take four years, Grabauskas says he has “beaten them down” to 17 months. “Other [improvements] you’ll see little by little,” he says.
But Mark Richards, editor of Badtransit.com, an MBTA watchdog Web site, argues that years of mismanagement have compromised the authority’s ability to address its repair needs or any other problems. “You can’t pour money into something that has incompetence at its core,” he says.
Former governor and longtime Green Line rider Michael Dukakis has noticed cosmetic changes at his Longwood stop, recently painted for the first time in years, he says. But chronic problems, such as escalator breakdowns, still rankle him. “If you are not repairing escalators on the weekends, then what are you doing?” he says.
TOUGH CUSTOMERS
The T’s frequently out-of-order elevators and escalators were among the problems targeted by the new general manager on his first day on the job, as he called them “a disgrace” and vowed to create a new position—“director of vertical transportation”—to keep tabs on their operation. But in November, the MBTA board gave Kone, the embattled maintenance contractor, another five-year, $33 million contract. Not only was the company the low bidder, says Grabauskas, but its performance is getting better.
He leafs through a stack of daily reports he receives on elevators and escalators, showing, for example, the number of elevators in service systemwide as 98.7 percent one day and 97.6 percent on another. “The numbers are bearing out that there has been a tremendous improvement,” says Grabauskas. “But that’s not an excuse for us to sit back on our hindquarters and not do more.”
or working hard, then you’ll be gone.”
Escalator and elevator problems have contributed to the T’s legal woes. In 2002 the Greater Boston Legal Services filed a class action lawsuit against the MBTA alleging deficiencies in services for people with disabilities. As this story goes to press, the lawsuit is nearing settlement, according to Todd Kaplan, a staff attorney in the GBLS Cambridge office. Grabauskas is the first general manager who believes the system should be 100 percent accessible, according to the attorney.
“He totally gets it. He understands what it takes,” says Kaplan. “Whether he can do it is a big question.”
Grabauskas has a better sense of the level of frustration among riders than his predecessors, says Jodi Sugerman-Brozan, a spokesman for the 24-member MBTA Rider Oversight Committee, an advisory group of transit advocates, members of the general riding public, and T officials. Grabauskas insists he reads his e-mails (at gm@mbta.org), which average six or seven per day, and responds personally to about one out of 10. But Smalls, of the T Riders Union, complains that Grabauskas is growing more distant by the day. When he first came on board, she says, the general manager told her that his “door was open.” No more, she says. “You call him now, and you don’t get a return phone call.” Smalls is disappointed. “I’m really hoping that we can work together to get through some of these things, but it is not looking too promising right now,” she laments.
Much will be riding on how Grabauskas handles adjustments associated with the new automated fare collection system. The MBTA expects to increase revenue as a result of curbing fare evasion. But the automated-fare system could also accommodate other changes now under consideration, such as reduced fares when transferring between trains and buses. The T is soliciting input from the rider committee, but it wants the new fare structure to be “revenue neutral,” meaning it would have to generate the same amount of money as the current one. That could mean an increase in the base fare, last increased in 2004, in order to offset possible price breaks with transfers.
“It’s going to look like a fare increase [imposed] with new technology,” says Sugerman-Brozan, who also coordinates On the Move, a “transportation justice coalition” that, like the T Riders Union, is under the umbrella of ACE. And with Grabauskas already hinting at an overall fare hike in the offing, riders could get hit with a double whammy. “What it’s going to feel like is two back-to-back fare increases,” she says.
of disrepair on a 100-year-old system.
It will be even worse if riders feel they’re getting nothing for the higher fares, says Smalls. “They are not going to be happy about a fare increase,” she says, “but they might be OK with it if the level of service is actually being improved as well.”
“The riders are going to be tough,” says former MBTA general manager Michael Mulhern, Grabauskas’s predecessor. “They are going to expect that the MBTA is going to be kept affordable, they want good, reliable service, and they want constant improvements in service.”
‘THE ELLIOT RICHARDSON OF STATE GOVERNMENT’
Pleasing everyone may be impossible, but if anyone has shown he can make people happy, it’s Dan Grabauskas.
He was born in Worcester, in 1963. Grabauskas’s grandparents and his father, then a toddler, had fled their native Lithuania for Germany during World War II, spending two years in a work camp. In 1949, the family emigrated to Boston, settling finally in central Massachusetts.
“We spent a lot of time thanking God we were Americans, not liking communists very much, and taking our liberty and what-have-you pretty seriously,” says Grabauskas, who is the oldest of four children. After Lithuania achieved independence, he returned to his ancestral homeland, working with the country’s democratic reformers, and later served stints as an election observer in Bulgaria and Nigeria.
Former Lunenburg Republican state senator Mary Padula hired the College of the Holy Cross graduate as her chief of staff in 1986. He later became her deputy secretary when she assumed the Executive Office of Communities and Development secretariat.
“You could tell he was into government,” says Padula. “He cared about it. He was constructively critical of it.” From there, Grabauskas went on to positions in Health and Human Services, Economic Development, and the top slot at Consumer Affairs and Business Regulation, before being dispatched to the Registry by then-Gov. Cellucci.
Grabauskas is the “Elliot Richardson of state government,” having excelled in so many agencies, says David Tibbetts, the former state director of economic development, who tapped Grabauskas to lead his staff.
In 2002, Grabauskas tried to convert his acclaim as government jack-of-all-trades into votes, becoming the Republican nominee for state treasurer, a post vacated by Shannon O’Brien in her bid for governor. But he was beaten handily by Democrat Tim Cahill. Grabauskas says that campaign taught him that pursuing statewide office is “incredibly difficult” without personal wealth. “I’m not willing to sell my soul,” he says.
When Mitt Romney took office as governor at the start of 2003, he named Grabauskas secretary of the Executive Office of Transportation. Sen. Steven Baddour, a Methuen Democrat who took over as Senate chairman of the Joint Committee on Transportation at roughly the same time, says they both had “huge” learning curves, but that it wasn’t long before Grabauskas got up to speed. “He just got it so quickly,” the senator says.
As transportation secretary, Grabauskas managed an agency with $1.4 billion in operating expenditures, a $1.4 billion capital budget, and more than 8,600 employees. Of his principal accomplishments at EOT, Grabauskas points to the start of construction on the Sagamore Rotary Flyover project, intended to reduce congestion at Route 3 and the Sagamore Bridge; improvement of communication among the transportation secretariat’s four agencies; and his work on Gov. Romney’s 20-year, $31 billion draft transportation plan, the first comprehensive examination of statewide transportation needs. (The last large-scale transportation study, completed in the 1970s, covered only the region inside Route 128.)
However, with the balance of power in transportation decision-making shifting to the Office for Commonwealth Development, which oversees transportation, housing, and environmental agencies, the EOT has followed rather than led on transportation initiatives. In addition, Grabauskas missed being a hands-on manager. “I enjoyed the Registry, being hands-on, trying to make a difference in reducing the aggravation in people’s lives,” he says.
As secretary of transportation, Grabauskas was also chairman of the MBTA board of directors. When Mulhern announced that he was giving up the general manager’s post, Grabauskas resigned his cabinet position to become a candidate for the job. There was no indication at the time that anyone else was seriously considered, and in a unanimous vote, the board of directors appointed Grabauskas to the post. Gov. Romney tapped MassHighway commissioner John Cogliano to move into the secretary’s slot.
Grabauskas rides the T to get around town for meetings and events, but it’s not how he gets to work. He drives every morning to the Transportation Building, in Park Square, from the home in Ipswich he shares with his partner, Paul Keenan, a Harvard University associate dean. “I live about as far from the Ipswich [commuter rail] station as you can get,” Grabauskas says. In addition, his 12-to-13-hour workdays don’t fit well with a train schedule, he says. But before moving to the North Shore in 1997, he says, he commuted to Boston from Arlington by bus and Red Line for about 10 years.
T-ORIENTED DEVELOPMENT
Rail station projects keep Grabauskas on the move. An Orange Line trip to Jackson Square in Jamaica Plain finds the general manager joining a group of young artists to mark the completion of a two-year mural project. The station and the neighborhood around it were both neglected during the 1980s, but today the area is on the verge of a development boom. The MBTA, the state, and the city of Boston have designated Jackson Square Partners as the developer of parcels adjacent to the station. The project includes 430 units of mixed-income housing, a youth and family center, retail, and office space for local nonprofit groups.
Rep. Jeffrey Sanchez, a Boston Democrat who represents the neighborhood, says Grabauskas’s ability to deliver on earlier T commitments gives him hope that improvements will continue apace. “Grabauskas wants to keep taking about Jackson Square,” he says.
He could have many Jackson Squares to talk about. “Transit-oriented development” is a linchpin of the “smart growth” policy being pursued by the state’s Office for Commonwealth Development and its secretary, Doug Foy. From the state’s point of view, subway stops and commuter-rail stations should be hubs of activity, with a mix of residential and commercial uses within walking distance of public transportation. Such an approach is intended to spur development in a less sprawling, car-oriented fashion. To facilitate the development of surplus land around transit stations, the MBTA and Foy’s office plan to make available $30 million in grants to communities and other organizations to stimulate mixed-use project development.
But in transit-oriented development, as in other state policies, the devil is in the details, and advocates of this approach are leaving nothing to chance. Take the Urban Land Institute Boston’s Transportation Priorities Task Force, established last March to influence the state’s transportation agenda in a way that reflects transit-oriented development goals. Preliminary studies by the task force found that, in the city of Boston alone, there are 78 development projects of 100,000 square feet or greater with the potential to affect T ridership, with 55 situated within a quarter mile of mass transit. Yet the impact of this transit-oriented development on the transit system itself has not been taken sufficiently into account, task force members say.
Grabauskas is increasingly inaccessible.
“If you put 430 units of housing in Jackson Square, will that exceed the Orange Line’s capacity? Will the trains have to run more often? Will the trains have to be longer?” asks Mossik Hacobian, the task force’s co-chairman, who participated in the initial Boston Redevelopment Authority–facilitated Jackson Square planning discussions. While Hacobian doesn’t fault the process, he argues that planners did not ask key questions about how transit-oriented development would affect the T’s bottom line, especially its operating deficit.
“Not once did it occur to anyone that the transit system might actually have an impact on the amount of development” or vice versa, says Hacobian, who is also executive director of Urban Edge, a community development corporation. According to BRA spokesman Meredith Baumann, the MBTA was “at the table” during the plan’s planning phase; now that a developer has been designated, its proposal will undergo more extensive consideration of its impacts on the Orange Line and other issues and will include additional community review.
WHERE THE T GOES, CONTROVERSY FOLLOWS
In a sense, transit-oriented development simply compounds the controversy that attends any MBTA expansion plan. Recent transit projects, including the Silver Line and the $497 million Greenbush commuter-rail extension, have been hamstrung by community wrangling.
And there’s plenty more expansion to come. Looming large on the MBTA’s agenda are commitments surrounding the Big Dig. The estimated $770 million revised package of projects includes the Green Line extension to Somerville and West Medford; additional stations and other improvements on the underused Fairmount Line; and at least 1,000 new parking spaces at commuter-rail stations. State officials have dropped plans to restore the Arborway Line in Jamaica Plain and to build a Red Line–Blue Line connector downtown, but that decision has resulted in two lawsuits. Conservation Law Foundation is suing to force the state to uphold the original 1990 Big Dig transit agreement, which CLF negotiated. Recently, Partners HealthCare and its downtown hospital, Massachusetts General, also filed suit over the Red-Blue connector. In addition, CLF intends to push for projects that the state Department of Environmental Protection has added to the T’s plate as mitigation for the delays in completing the original transit commitments, such as adding 18 new Orange Line cars and improving signals on that line.
“The Commonwealth has made an immense investment in our auto traffic through construction of the Big Dig, and a complementary transit investment is needed to protect air quality as well as promote mobility for transit and roadway users,” says CLF staff attorney Carrie Russell.
In a sense, the MBTA faces flak whether it wants to build a project or drop one. But Grabauskas says major public works projects will always cause a ruckus. “You can’t put a curb cut in or a sidewalk, or [put up] a telephone pole without getting dozens of people coming out to a community meeting,” he says. “Well, now, imagine if you’re doing a massive restoration of a rail line or a tunnel that is a couple miles long.”
Stephanie Pollack, coordinator of the Urban Land Institute transportation-priorities task force and a senior research associate at Northeastern University’s Center for Urban and Regional Policy, contends that transit projects do more than rip up streets. The former CLF staffer says they transform neighborhoods, affecting traffic patterns, housing prices, and other aspects of community life. “You don’t build local support by sort of explaining to people over and over again why they should like a project,” she says. “You build support by convincing them that you’ve heard their concerns and you actually have a way of addressing them.”
But one person’s mass transit lifeline is another’s boondoggle. The $670 million New Bedford/Fall River extension of the Stoughton commuter rail line is a project that political and business leaders from that region have sought for years (“South Coast railing gets commuter line on track—sort of,” CW, Summer ’04). But that plan is destined for a court battle if the state pursues a route through the Hockomock Swamp, the largest freshwater vegetated wetland in Massachusetts, insists Kyla Bennett, director of Public Employees for Environmental Responsibility’s New England chapter.
Former governor Dukakis says that targeting old urban communities is the best smart-growth strategy. “You’re not going to turn Fall River, New Bedford, Lawrence, Worcester, and Fitchburg into thriving, vibrant communities that accommodate growth, both residential and business, unless they have first-rate commuter rail connections to the capital city,” he says.
Still, others complain that transportation needs in and around the capital city have suffered as a result of rail expansion principally serving suburban commuters, pushing to the back burner projects like the Urban Ring bus rapid transit plan, which would provide crosstown connections linking Boston, Brookline, Cambridge, Chelsea, Everett, Medford, and Somerville that the present network lacks.
As much as people badmouth the T, Grabauskas says, everywhere he goes people want it. Who sets the priorities? The MBTA, the Boston Metropolitan Planning Organization, and the Executive Office of Transportation’s planning office evaluate projects on criteria in seven categories, including rider utilization, cost-effectiveness, and air quality, as specified in the 2004 Program for Mass Transportation, the MBTA’s 25-year capital plan. The PMT ranks more than 80 projects from low to high priority. The Urban Ring and New Bedford/Fall River projects are “big, difficult choices,” according to Jason Roeder, a deputy secretary in the Office for Commonwealth Development.
FUNDING, BACKWARD AND FORWARD
After the choices are made, and the service provided, the T is left paying the bill. That’s because farebox revenues don’t cover the full cost of any MBTA service. The more the T expands, the more pressure builds on its budget.
“Unless we can address the operating deficit, the expansion projects are going to be controversial at best and possibly impractical and infeasible at worst,” says Hacobian, the Urban Land Institute task force co-chairman.
Some observers go further, arguing that the T should put system expansion aside and devote finite resources to the existing network. But that would mean saying no, something many political leaders are loath to do.
“No one is willing to put the kibosh on these projects,” says Charles Chieppo, a former policy director of the state Executive Office of Administration and Finance who served on the MBTA Blue Ribbon Committee on Forward Funding and a sharp critic of system expansion. “No one is saying, this has got to end.”
According to Paul Regan, executive director of the MBTA Advisory Board, the transit authority has no flexibility in either its capital or operating budgets. There is broad consensus among key state lawmakers and transportation finance analysts that the authority cannot pay both for system maintenance and future expansion projects without crippling its core operations.
The system expansion of the past has come back to haunt the MBTA budget in two ways. First, the capital costs of new stations and equipment live on in debt service, which now eats up roughly one third of the T’s annual budget—$345 million out of $1.2 billion in fiscal 2006. And then there is the operating cost of expanded service. With fares covering only a third of the T budget, more service simply means more of a shortfall.
For decades, the deficits were absorbed by the state at the end of each fiscal year, a process that gave T managers no incentive to get costs under control. But in 2000, the Legislature instituted “forward funding,” dedicating 20 percent of the state sales tax to MBTA operations as the sole state subsidy. In addition to farebox and revenue from other sources, such as advertising and parking lot fees, the authority also relies on assessments levied on the 175 municipalities in the T network, which will bring in $136 million this fiscal year. Now on a fixed budget, the MBTA can no longer be expected to fund all the expansion everyone wants it to undertake. So under Gov. Mitt Romney’s transportation plan, the state would cover the capital costs of future system expansion, after the completion of the Silver Line.
This pledge is “an important recognition of that reality and a positive step,” says Massachusetts Taxpayers Foundation president Michael Widmer, who chairs the Transportation Finance Commission’s Transit Subcommittee. But critics like Sen. Robert Hedlund, a Weymouth Republican who is a member of the Joint Committee on Transportation, say the state cannot afford to pay for expansion projects. Hedlund says the MBTA created its own problems by ignoring the recommendations of the Blue Ribbon Committee on Forward Funding and pursuing expansion projects such as the Greenbush commuter rail line—a project Hedlund opposed—based on political criteria rather than transportation merit. The debt service generated by Greenbush severely crimps the T’s ability to pursue projects such as New Bedford/ Fall River commuter rail, which he calls “financially impossible.” Even if the state were to bail out the T on the capital end of expansion—and central and western Massachusetts lawmakers’ support for such a scenario is by no means assured, he adds—the question remains whether the MBTA can cover the operational and maintenance costs of running new lines.
“When you have problems maintaining elevators and maintaining the Green Line, explain to me, how are you going to maintain this…unprecedented expansion?” says Hedlund.
The T’s operating budget remains problematic, with or without expansion. In part, that’s because the promised sales-tax subsidy never lived up to expectations. Under forward funding, sales tax revenues were projected to grow at least 3 percent per year. Lawmakers also set a $645 million floor for fiscal 2001, according to the Massachusetts Taxpayers Foundation/ Pioneer Institute report MBTA Capital Spending: Derailed by Expansion? But shortly after the forward funding plan was approved, sales tax revenues plummeted as a result of the recession.
In fiscal years 2002 to 2005, actual sales tax receipts were too low to generate the minimum guaranteed to the MBTA. After peaking at $654.6 million in 2001, the T’s 20 percent share of the sales tax dropped to $638.8 million, $26 million below its guarantee of $664.4 million for that year. Since then, sales tax receipts have inched up slowly, by 0.1 percent and 0.5 percent in 2003 and 2004, respectively, reaching the projected growth rate only in 2005, at 3.7 percent. The Legislature has made good on its guarantees of minimum funding, appropriating funds where necessary to make up the difference. But that still leaves the authority $77 million short compared with the projections forward funding was based on, according to the MBTA.
“If I had $77 million more right now, I’d have no deficit,” says Grabauskas. Compounding the T’s budget woes this year is the record-setting hurricane season, which spiked fuel costs. Partly as a result, the authority is grappling with a budget deficit approaching $27 million, though Grabauskas calls that a “moving target.”
When asked if forward funding should be tweaked, Grabauskas says yes. Roeder, of the Office for Commonwealth Development, says that’s not in the cards. The state’s assumption of expansion costs, as well as internal management reforms, should allow the MBTA to make do with forward funding, he says.
But Baddour, the Senate transportation committee chairman, would be willing “to make a pitch” to get the T more financial help from the state, and Grabauskas’s credibility on Beacon Hill could help, he says. “Dan is saying things that a lot of people don’t really want to hear, but need to hear,” Baddour says. “The T is in rough financial shape.” (Fiscal 2006 marked the first year since the introduction of forward funding that the MBTA plans to dip into its deficiency fund, to the tune of about $10 million, to address budget shortages.)
What shape that help would come in is unclear, however. One idea, increasing the gas tax, is seen as a political nonstarter, and few other alternatives have gained traction. For its part, the Transportation Finance Commission, which will publish its report on the state’s transportation funding needs in the first quarter of 2006, has suggested a number of options, including using highway toll revenues to subsidize mass transit, other user fees, real estate development on MBTA-owned property, and tax increment financing.
In the meantime, the general manager says he is looking at scaling back overtime pay, the use of consultants, and nonessential staff, as well as other cuts. The T has some of the highest payroll costs among US transit agencies, according to the Massachusetts Taxpayer Foundation/Pioneer Institute report. Pension contributions for fiscal 2006 are up nearly 40 percent over 2005, with health care costs up about 10 percent. But MacDougall says labor costs are not the problem.
“They’re an excuse by some to try to point to a place where you can gain efficiency,” says the union chief. Health care and wages are major issues in negotiations currently underway between the MBTA and the Carmen’s Union, whose contract, along with most of the other 27 T unions, expires at the end of June.
Unless Grabauskas can do something about the T’s chronic budget woes, his promises of improved services may come to naught. Faced with a $10 million deficit going into fiscal 2006, Mulhern discontinued Night Owl service and cut back subsidies to private suburban bus lines in his last year as general manager.
LAST STOP
The job of MBTA general manager is not for the faint of heart. None of the last three occupants of that post—Michael Mulhern, Robert Prince, or Patrick Moynihan—lasted five years. Grabauskas’s enthusiasm for his mission is obvious, but he hasn’t thought beyond a five-year window. “You also have to be realistic,” he says. “The burnout rate is pretty high.”
For Grabauskas, the MBTA could be a career-making, or derailing, proposition. While the general manager doesn’t explicitly rule out a future run for public office—it is “not totally impossible, but it’s a tough one” is how he puts it—he won’t be able to rest on his Registry laurels much longer. Though it’s rare to hear a discouraging word about Grabauskas, an uncanny state of affairs for any public official, at some point, the MBTA’s deficiencies will become Grabauskas’s. While some improved directional signage has sprung up in recent weeks, so far advocates and riders have little to point to in the way of concrete changes, in contrast to the quick fixes instituted at the Registry, though most concede it’s too early to pass judgment. Still, the stakes are high: If he succeeds in reinvigorating the T, he’ll be able to write his own CharlieTicket. If he fails, or even makes scant progress, his reformer’s mantle will begin to unravel. Among Grabauskas enthusiasts, the prediction is unanimous, if in some ways also ominous.
“He will whip the MBTA into shape,” says Doody, Grabauskas’s former RMV deputy. “He will get it done. And if he doesn’t, I don’t know who will.”
Mr. Nice Guy was fired from his last two jobs.