T board divided on means-tested fares

MBTA OFFICIALS on Monday offered up a potential timetable and an estimate of costs for offering discounted fares to low-income riders, but the T’s oversight board appeared split on the best way to proceed.

Two members of the five-member Fiscal and Management Control Board – Brian Lang and Monica Tibbits-Nutt — said they favored moving ahead with a pilot of so-called means-tested fares next year as a way to put pressure on the Legislature to provide funding for a full rollout a couple years down the road.

The approach runs counter to current thinking at the T, which holds that means-tested fares should not be launched without a separate source of funding for them. The price tag is fairly significant, with T officials on Monday estimating that the cost could run as high as $112 million a year to provide discounted fares to riders with incomes at 200 percent of the federal poverty level.

The cost estimate includes a number of variables. The T estimated the startup cost would range between $7 and $13 million and between $52 and $85 million annually in terms of lost revenues and administrative costs. If service is expanded to accommodate expected higher ridership, the cost would jump to between $72 and $112 million a year, the T estimated.

Lang said he appreciated the cost implications, but he said the MBTA has been waiting for the Legislature to step forward with funding for years with no luck. He suggested it might make more sense for the T to pilot means-tested fares on its own next year and use the success of the pilot to put pressure on the Legislature for full funding. “Let’s take a little bit of a risk,” he said.

Tibbits-Nutt seconded the idea. “At some point we need to take a leap of faith,” she said.

MBTA General Manager Steve Poftak said he opposed launching means-tested fares without first securing a dedicated revenue stream from outside the agency to pay for them.

Tim Sullivan, another member of the control board, said he thought launching a means-tested fare pilot next year was a bad idea, particularly because the current board is expected to go out of existence in June and be replaced with a new board. He said that new board is already facing significant challenges, including looming deficits of several hundred million dollars caused by the absence of operating funds for the new Green Line extension and South Coast Rail. He said adding a means-tested fare pilot to the mix would be unwise.

“There’s this massive fiscal hole out in the future and in that context we’re going to try to create political pressure? I think this is going to land with a huge thud,” Sullivan said.

Joe Aiello, the chair of the control board, steered clear of a decision at Monday’s meeting, recommending that the board wait until June when T officials can report back on what a slimmed-down pilot project might cost.

Pressure is growing for the T to offer its services without fares or with discounted fares. At a forum on Monday, most of the Boston mayoral candidates supported some form of free fares. Acting Mayor Kim Janey is backing a fare-free pilot on a bus route running down Blue Hill Avenue and also pushing for means-tested fares. During Monday’s meeting of the control board, she submitted a video during the public comment period in which she called for a means-tested fare program. “We need an affordable public transit system,” she said.

T officials prefer a means-tested fare program rather than free fares because the means-tested fares can target aid just to those who need financial assistance and because they are cheaper to implement. At a recent control board meeting, T officials estimated the cost of providing free bus service would range between $97 million and $137 million in its first year without adding new service to reduce overcrowding. Adding more service to avoid overcrowding would drive up the cost to between $184 million and $486 million.