T struggling to meet budget targets
Narrow hiring freeze, rethinking of parking prices being considered
THREE MONTHS INTO into its current fiscal year, the MBTA is struggling to meet its budget targets.
Revenues and expenses are on pace to come in nearly $53 million behind projections, and T officials are considering a host of initiatives to close the gap, including a hiring freeze in support services positions, a rethinking of the T’s parking prices, and more stringent cost controls.
So-called own-source revenues from advertising, parking, and real estate are lagging behind projections, expected to fall 13 percent, or $15 million, behind the target of $111 million. If the gap isn’t closed by the end of fiscal 2020 at the end of next June, it would be the third straight year the T missed its own-source revenue target.
The budget deliberations are another sign of revenue pressures at the MBTA. Gov. Charlie Baker has insisted the T has all the money it needs for the foreseeable future, but he is referring to money needed for long-term capital projects. The operating budget covers the cost of running the T on a day-to-day basis, and the agency has had great success the last few years in matching expenses with revenues available from the state sales tax, state appropriations, and own-source revenues.
In some respects, the T’s budget problems are self-inflicted because the agency each year diverts $150 million of a $187 million legislative appropriation for capital projects. That leaves $37 million to cover shortfalls in the T’s operating budget, but that amount won’t be enough this year if current spending and revenue trends continue. The situation could worsen if an expected increase in sales tax revenue fails to materialize.David Panagore, the T’s chief administrative officer, said he is considering revisiting the T’s dynamic pricing program, an initiative launched in 2018 that hiked fares at the authority’s busiest garages and lowered them at less-busy facilities and at off-peak times. Early indications are that the authority won’t hit its nearly $45 million parking goal for this fiscal year.
Transportation Secretary Stephanie Pollack said she wanted a full report on the parking program. She said she has heard reports that the low prices at the MBTA’s 494-space Beverly garage ($2 for up to 14 hours) have succeeded in filling the facility. “But there’s some concern it might not be commuters. It may be that the parking is so inexpensive that people may be parking there for other things,” she said.