T eyes new revenue-raising efforts
Higher parking fees, new developments possible in $40m plan
STATE HOUSE NEWS SERVICE
WITH THE GOAL OF BOOSTING its own-source revenues by about $40 million, the MBTA is looking at hiking parking fees, converting surface lots into developments, and maximizing revenues from telecommunications and utility companies that want to use the system’s rights of way.
“We’re trying to put everything on the table and quantify everything,” MBTA Chief Administrator Brian Shortsleeve told reporters ahead of a Fiscal and Management Control Board meeting on Friday. He said, “There’s a lot of opportunity out there.”
Shortsleeve said no decisions are imminent, but the goal is for the T, which now generates about $60 million through real estate and advertising, to be on pace to generate $100 million annually by the end of fiscal 2017.
Most of the T’s surplus property has already been sold off following a directive in the 2000 forward-funding law, said Mark Boyle, the authority’s real estate chief.
Boyle said the T would look to convert surface parking lots into a mix of transit-oriented development with new garages built to replace the lost spots. He said the T would typically sign 99-year leases to secure a steady stream of revenue.
MBTA officials have not yet determined how to go about restructuring parking fees, according to Boyle. A presentation suggested parking revenues could be boosted by $10 million to $15 million with “price adjustments” accounting for $6.6 million to $9.6 million, and other enhancements from operational improvements, outsourcing lot management, and adjusting capacity.
“We don’t have any specific fees that we’re studying at this time,” said Boyle, who added that the T had not raised fees since 2008 and stressed that officials would need to look at the “total cost of commuting” when considering changes.
Subway riders, under the current structure, can pay up to $7 per day to park at an MBTA lot while commuter rail riders can pay $4 per day to park, though they pay much more for the ride.
“The commuter rail ticket prices are much higher than the subway,” Shortsleeve noted. The MBTA’s parking fees are about average compared to peer agencies, according to the T.
The MBTA is looking at a projected $242 million deficit in fiscal 2017, a sum certain lawmakers have suggested state budget-writers could be willing to cover. The control board, formed after last winter’s repeated failures and shutdowns, is developing plans to diminish or eliminate the structural deficit.
The T’s proposal to develop spare portions of surface parking meshes with an idea Gov. Charlie Baker discussed on the campaign trail last year to supply more affordable housing by developing commuter rail lots into transit-oriented developments, describing some existing underused property as “basically beer cans, burned out automobiles, and tall grass.”
“He’s very interested in this,” Shortsleeve said of Baker. On Monday, Baker will attend an open house for utility companies, the solar industry, and real estate developers where state transportation officials as well as MassDevelopment and the Division of Capital Asset Management and Maintenance will educate the business community about opportunities. The “Commonwealth is Open for Business” event will be held at the Transportation Building Monday morning.
Boyle said the MBTA has 6,785 acres and about 4,000 parcels of land, most of which is used by the MBTA for its operations. The T also has about 1,200 real estate agreements, the majority of which are for land rental, Boyle said. He said utilities and telecommunications companies are interested in using the MBTA’s subway routes and commuter rail rights of way to avoid digging up city streets.
In addition to other efforts to tackle the $242 million projected fiscal 2017 deficit, the T sketched in $27 million to $32 million from increased real estate, concessions, and parking revenue, along with $5 million to $9 million in increased advertising revenue.
Boyle said it is “important” that the MBTA retain its exemption from local regulation of its advertising, such as billboards.
“That’s important that we have that,” Boyle said. He said, “There’s been various legislative discussions about changing that.”
Among other money-makers, the MBTA is looking to add more ATMs on its properties, an initiative that Boyle said the banking industry is “very excited” about.
Shortsleeve said the MBTA receives about $41 million in gross parking revenue annually, and nets $17.2 million. The T securitized part of its parking revenue in 2012 so that this year $15.4 million goes to bond-holders and $9.2 million will go to pay LAZ Parking, a property manager, in fiscal 2016, Shortsleeve said.
Also in the area of parking finances and operations, Teamsters Local 25 has spent the past two years organizing parking lot attendants, a union official told a legislative committee in September.