This story has been updated.
MBTA OFFICIALS are revising downward their ridership and revenue projections based on scenario planning that envisions telecommuting becoming “standard practice for the foreseeable future.”
State transportations officials on Monday unveiled three ridership scenarios, each with a gradual increase in ridership but different expectations about telecommuting – one with only a slight increase in telecommuting, a second with a higher level of telecommuting, and a third with some travel and business restrictions remaining in place and telecommuting becoming standard practice.
Under all three scenarios, ridership will be lower than forecasted earlier this year. The T had projected fare revenues to reach 60 percent of pre-COVID levels by mid-year 2021. Now that level will not be reached until the beginning of 2022 under the most optimistic scenario with relatively little telecommuting. Under the scenario envisioning telecommuting become standard practice, fare revenue won’t reach 60 percent of pre-COVID levels for the foreseeable future. The high point would be 55 percent in June 2022.
Adding to the T’s difficulties are projections that vehicle traffic won’t be returning to pre-COVID levels for several years, even under the most optimistic scenario. Transportation Secretary Stephanie Pollack said vehicle miles traveled during the peak 6 a.m. to 9 a.m. period will remain below pre-pandemic levels through the end of 2023 at least. She said less congestion on the roads is likely to mean less use of the MBTA.
The T appears to be leaning toward the most pessimistic ridership scenario in developing its budget projections, which would leave the T with a relatively small budget gap in the current fiscal year, even with $605 million in federal stimulus aid.
According to one slide in the briefing package, fare revenue in the current fiscal year will total nearly $144 million — $76 million from subway, $41 million from bus, $23 million from commuter rail, $2 million from paratransit, and $1 million from ferry.
In fiscal 2019, prior to the pandemic, total fare revenue was $672 million — $306 million from subway, $239 million from commuter rail, $109 million from bus, $12 million from paratransit, and $6 million from ferry.
The T is projecting that it can handle a small deficit this fiscal year, but fiscal 2022 will be far more challenging as no federal stimulus funds are currently available and revenues will continue to recover slowly.
Under the most pessimistic ridership scenario, fare revenues would rise from $144 million in fiscal 2021 to $279 million in fiscal 2022 – about 42 percent of the pre-COVID level. Under the most optimistic scenario, they would rise to $436 million, or about 65 percent of the pre-COVID level.
T officials outlined a number of possible steps to address a potential fiscal 2022 budget shortfall, including $150 million in service cuts and redirecting hundreds of millions of dollars in federal funds that would normally go for capital projects into the operating budget. Fiscal 2022 starts on July 1, 2021.
The T’s expenses, according to the briefing materials, are divided into five broad categories totaling nearly $1.8 billion. Wages account for $452 million. Purchased services and materials represent $182 million. Contracted transportation services, where ridership is way down, total $544 million split between commuter rail ($452 million), paratransit ($119 million), and ferry ($14 million).
The rest of the T’s expenses are split between interest payments on debt, which represent 23 percent of the total, or $486 million, and pension costs, which account for $115 million, or 5 percent of the total.