What the T fiscal control board needs to do
Freeze fares, boost revenue, and innovate
NOW THAT THE MBTA’S fiscal control board is in place – a board that reflects a consensus approach to creating an additional power center at 10 Park Plaza – we await action that will tackle short term fiscal needs and prepare the T for the mid- and long-terms. Lets look at the short-term needs first.
The Baker Administration has directed over $80 million in funding to target specific maintenance, repair, and training needs that will help the T manage through another winter snow emergency. Mother Nature may also help out this season: recent reports indicate that the American and Canadian northeast were the only regions in North America that did not experience record warming last winter. If the warming continues to migrate north (not necessarily a good thing as it implies continued global climate change), our winters may be milder in the near future. Time will tell. In the meantime, it’s good to be prepared for the worst.
The short-term fiscal solution for the T should not include a fare increase. The state Senate has wisely acted to prevent lifting the cap on fares, an important first step toward ensuring modal and social equity. The proper policy is to keep fares frozen until a clearly better transit product is offered to all T riders. We have continually asked T riders to pay higher fares for an increasingly poorer product – no business would survive such a strategy, and the T won’t either. Until and unless the T can show tangible, meaningful cost savings from the repeal of the unfairly vilified Pacheco law, and other internal management reforms, fares should be frozen – otherwise there is no incentive for the T to take the hard steps necessary to make these reforms really work. Moreover, higher fares place an additional financial burden on those who can least afford to pay, while gas taxes remain artificially low and not even subject to adjustment for inflation.
Our state transportation funding system is, in substance and effect, basically the same system that was in place when Frank Sargent was governor some 45 years ago. It’s a system that heavily subsidizes the true costs of vehicular mobility at the expense of all other modes. It’s a system that hasn’t kept pace with inflation and whose purchasing power has therefore eroded significantly. And it’s a system that has only scratched the surface of adopting technologies that will help increase net new revenue and modal equity. In short, the Massachusetts transportation funding model is inequitable, unsustainable, and woefully behind the times. Reforming that system and making it more robust, reliable, and equitable must be part of the overall solution.
The public sector can’t, and shouldn’t, stop the private sector from innovating. Instead, it needs to step up and also innovate. Innovation isn’t something the public sector is good at because few public employees or officials will take risk, and you cannot innovate without taking some measure of risk. I believe that we have a governor who knows the importance of assuring Secretary of Transportation Stephanie Pollack and her team that he has their backs and that innovation, which I define as informed creative thinking and action, will be supported. Some initiatives will fail but others will thrive and pay large dividends – that’s what innovation is all about.
A number of strategies and actions can be employed to address the T’s fiscal condition and operational reliability in the short, mid, and long terms. I remain doubtful that new privatizations are a large part of the answer because nearly half of the T’s budget is already privatized. Commuter rail is privatized. The RIDE is privatized. The T’s real estate management is privatized. There’s not a lot left to ship to the profit-driven private sector. However, if anyone can conjure up creative approaches to smart privatization it’s the new chair of the control board, Joe Aiello, who has been the driving force behind some of the most successful recent public-private partnerships in North America. His appointment makes me confident that the control board will be well led, and that it will have access to the best practices in global privatization.
My solutions? Well, if you’ve been reading my occasional columns on this topic, you will know that I support the following approach. For the short term: first, transfer all of the T’s legacy and “Big Dig” debt to the Commonwealth; second, transfer 10 to 15 percent of state highway dollars to transit for the next three to five years. These strategies free up over $300 million in available revenues annually without having to increase any taxes, fares, or fees. For the long term: introduce a pure user fee for all vehicles using state and interstate highways in Massachusetts (VMT) along with a congestion pricing regime, and dedicate 100 percent of the congestion pricing revenue to transit; introduce strong incentives that encourage modal shift from highways to transit; and finally, empower municipalities to assess a carbon impact fee on non-residential parking and dedicate those revenues to local pedestrian, bicycle, and transit improvements.
We should certainly consider smart privatizations that enable significantly more reliable service while also maintaining a fair and affordable system. Getting to Logan Airport might present an opportunity to engage the private sector. If you want to get to Logan by T, you can’t do it from the north because the Blue Line doesn’t extend to Lynn. You can’t do it easily from the northwest – disenfranchising many people including those who work and create jobs in places such as MIT and the Kendall Square Innovation District – because the Red and Blue lines don’t connect at Charles Street. And you can’t do it easily from Boston’s bustling Seaport and Innovation District because the SL1 service is a second-rate service, offering one of the most frustrating experiences of your transit life. The Silver Line service to and from Logan Airport may therefore be a candidate for a public/private partnership.
The SL1 bus does not offer a fast and seamless ride to Logan. Instead, the bus stops at traffic lights at D Street because we haven’t employed commonly available signal prioritization technology. It stops again to change power sources from electric to diesel because we haven’t invested in equipment that is modern or state-of-the-art. It then takes an artificially longer route to the Ted Williams Tunnel because it cannot use the tunnel ramp dedicated for exclusive State Police use, even though this could be safely and easily accomplished with a modest amount of technology and cooperation.
Perhaps the SL1 service should be privatized, but here’s my bet: no private sector group would take it on until the state and city agree to solve each of those barriers to a seamless ride that I have just described. Without those changes, neither the public nor private sectors will be able to offer first-world transit service between Boston’s downtown financial district and innovation center and its international airport. Moreover, the state’s public/private partnership law (not the Pacheco law, but the law contained in Chapter 6C of the General Laws that empowers state officials to enter into public/private partnership initiatives) is so far from being state-of-the-art, and so burdened by needless bureaucracy, that it acts as a disincentive to the private sector even considering entering the public/private partnership market here. Until we revise the statute to adopt national best practices in this area, we will not be able to attract serious interest from the major players in the privatization field.
Finally, I continue to believe that bus rapid transit (BRT) can be a mid/long term strategy to maintain a truly egalitarian transit system and keep the urban transit system competitive with micro transit options such as Bridj. BRT will improve urban mobility by offering a more reliable and attractive service at a significantly lower cost than alternatives such as light rail. It will also improve streetscapes and spark private sector investment, and ensure a large measure of modal and social equity by knitting Greater Boston together along new mobility pathways across many districts and demographics.
James Aloisi is a former state transportation secretary and a principal at the Pemberton Square Group.