General MBTA Topics (Multi Modal, Budget, MassDOT)

Re: Driven By Customer 'Service' Parte Dos

I haven't done much research on the T's finances, but ... (terrible way to start a comment, I know) ... here are my thoughts. Sorry for being long-winded.

Based on the MBTA budgets from its website (warning, PDF), the T has run an annual surplus for eight of the past 11 years.

Since 2001, annual total revenues have increased about 61% while annual total expenses (minus debt service) have increased about 75.5%. Debt service has gone up 44.5%. So, a problem exists, but there are other factors at work that should be recognized.

"Dedicated local assessment revenue" has gone up 4.5% during the past decade. This is the amount the T charges the ~151 municipalities in the Commonwealth that have residents who use (or could use) public transportation.

It looks as though it was supposed to go up exactly 2.5% each year, but in 2010-2011 it did not (presumably due to the drop in state aid during this time).

If instead of no increase it had continued to increase by 2.5% for fiscal years 2011 and 2012, it would be $157 million instead of $152 million, raising $5 million more.

Revenue from the 1% of the 6.25% state sales tax has gone up 31.5%, which sounds good, but the amount has stayed the same for each of the past three years (not sure how this was set) and is estimated to go up by just $10 million (1.3%) in fiscal year 2012.

If, instead, sales tax revenue had increased somewhere in its regular range of $15 million per year, the T would received $812 million in 2012 instead of the projected $777 million. This is an additional $35 million.

So, the T would have $40 million more without doing anything right now if it had raised revenues at the historic rate.

Obviously, it would still be ~$121 million in the red, but by 25% less.
 
Re: Driven By Customer 'Service' Parte Dos

JohnAKeith said:
I haven't done much research on the T's finances, but ... (terrible way to start a comment, I know) ... here are my thoughts. Sorry for being long-winded.

Based on the MBTA budgets from its website (warning, PDF), the T has run an annual surplus for eight of the past 11 years.

Since 2001, annual total revenues have increased about 61% while annual total expenses (minus debt service) have increased about 75.5%. Debt service has gone up 44.5%. So, a problem exists, but there are other factors at work that should be recognized.

"Dedicated local assessment revenue" has gone up 4.5% during the past decade. This is the amount the T charges the ~151 municipalities in the Commonwealth that have residents who use (or could use) public transportation.

It looks as though it was supposed to go up exactly 2.5% each year, but in 2010-2011 it did not (presumably due to the drop in state aid during this time).

If instead of no increase it had continued to increase by 2.5% for fiscal years 2011 and 2012, it would be $157 million instead of $152 million, raising $5 million more.

Revenue from the 1% of the 6.25% state sales tax has gone up 31.5%, which sounds good, but the amount has stayed the same for each of the past three years (not sure how this was set) and is estimated to go up by just $10 million (1.3%) in fiscal year 2012.

If, instead, sales tax revenue had increased somewhere in its regular range of $15 million per year, the T would received $812 million in 2012 instead of the projected $777 million. This is an additional $35 million.

So, the T would have $40 million more without doing anything right now if it had raised revenues at the historic rate.

Obviously, it would still be ~$121 million in the red, but by 25% less.
Click to expand...

And how far in the black would the MBTA be if their employees were paid market-level wages for their skills? Health insurance for life? cushy pension? six figure salaries for a semi-skilled job?

EDIT: Didn't see the other page of comments like this-- my bad
 
Re: Driven By Customer 'Service' Parte Dos

To think that service cuts and fare increases are the only way to balance the MBTA's budget is ludicrous. Only when the cost structure of a semi-skilled, unionized labor force is so far beyond out of whack does revenue become the issue. Like, are they freaking serious? The entire MBTA could be fired tomorrow and you'd have every position filled (for half the benefits and pay) before the pink slips even hit the first palm.

It makes my blood boil every time a fare increase or service reduction is proposed when one of the largest metropolitan areas in the country has to put up with sub-par service and severely dilapidated infrastructure simply because 6,200 or so people and those who represent them believe that the work they do is worth the outrageous amount in compensation they receive. Outrageous beyond comprehension.
 
Re: Driven By Customer 'Service' Parte Dos

^ Well said, Omaja.
 
Re: Driven By Customer 'Service' Parte Dos

omaja said:
To think that service cuts and fare increases are the only way to balance the MBTA's budget is ludicrous. Only when the cost structure of a semi-skilled, unionized labor force is so far beyond out of whack does revenue become the issue. Like, are they freaking serious? The entire MBTA could be fired tomorrow and you'd have every position filled (for half the benefits and pay) before the pink slips even hit the first palm.

It makes my blood boil every time a fare increase or service reduction is proposed when one of the largest metropolitan areas in the country has to put up with sub-par service and severely dilapidated infrastructure simply because 6,200 or so people and those who represent them believe that the work they do is worth the outrageous amount in compensation they receive. Outrageous beyond comprehension.
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Do you have any data to support the argument that rank-and-file MBTA employees are grossly overcompensated? Not a challenge, this just seems to be a recurring claim in this conversation and, as a relative newcomer, I'd be interested in seeing the evidence that backs this up.
 
Re: Driven By Customer 'Service' Parte Dos

Looking at that list, what strikes me isn't that salaries are overblown, it's that there are so many employees. Does the T really need dozens of plumbers paid $80,000+ each? Or could many of these positions be contracted out?
 
Re: Driven By Customer 'Service' Parte Dos

Many of those employees are no-shows. However it isn't just patronage payroll padding sinking the MBTA's finances, it's debt service on debt the MBTA never even accumulated itself.
 
Re: Driven By Customer 'Service' Parte Dos

Welp, it has been a banner day thus far for the MBTA. The red, blue and green lines all had delays due to disabled trains. I also saw on their website that several commuter rail trains were running behind due to weather related delays. It took me an hour and 45 minutes to go from North Quincy to Coolidge Corner this morning. I should also note that my red line train made 4 complete stops between North Quincy and Andrew, not including the JFK/UMass stop.

I mention this because one has to wonder if the MBTA could have picked a better time to introduce proposals for fare hikes and service cuts.
 
Re: Driven By Customer 'Service' Parte Dos

on npr yesterday the GM stated that basically every dollar that comes in through fares goes to paying off debt. They pay 452million in debt service a year (intrest and principle) and expect to bring in 450milion in fares. here is your problem.

you can listen tot he 5 minutes long interview here: http://www.wbur.org/2012/01/03/mbta-fare-hikes
 
Re: Driven By Customer 'Service' Parte Dos

Ditch the RIDE as it's own agency (why is it MBTA umbrella?), merge the transit PD into the Staties, make life-long benefits a little harder to achieve, stop hiring new bus drivers and such and just transfer obsolete positions into new ones as much as possible (ie: door operators eliminated on OL and soon the RL could be trained on buses). Also, the state should calculate how much debt has been forced on the MBTA and pay it off.

Also, what if we merged all regional transit agencies into one or two state agencies to cut out some management?
 
Re: Driven By Customer 'Service' Parte Dos

found5dollar said:
on npr yesterday the GM stated that basically every dollar that comes in through fares goes to paying off debt. They pay 452million in debt service a year (intrest and principle) and expect to bring in 450milion in fares. here is your problem.
Click to expand...

And this is why the MBTA should consider default as a preferable option to either service cuts or fare increases.
 
Re: Driven By Customer 'Service' Parte Dos

found5dollar said:
on npr yesterday the GM stated that basically every dollar that comes in through fares goes to paying off debt. They pay 452million in debt service a year (intrest and principle) and expect to bring in 450milion in fares. here is your problem.

you can listen tot he 5 minutes long interview here: http://www.wbur.org/2012/01/03/mbta-fare-hikes
Click to expand...

Yup. And that Big Dig debt is $100M on each of those payments. That's $98M in revenue they can't spend on the system.

The debt was a defensible assignment on the MBTA when it would've made the Turnpike Authority's debt service untenable. That's moot now with MassHighway absorbing it and the EOT taking a bigger role over the T, MassHighway, DCR, and Massport as a centralized agency. Forward funding and labor costs are going to be long, drawn-out affairs in the Legislature requiring some real drive to want to get things done. A balance transfer isn't quite so daunting. It would hurt MassHighway a lot, but they have funding sources to tap that the T doesn't for basic state-of-repair and safety needs, like the Accelerated Bridge Fund and other generally more permissive national highway funding. The T needs that -$100M annual debt service relief to keep its riders safe and its fleet operating.

Transferring the debt likely forces an up-down decision on raising the gas tax, which otherwise wouldn't fly in service to primarily the T but is the likely logical move for tackling the real source of that extra debt. MassHighway can make forward progress with it on their ledger via the gas tax, which maybe doesn't have to skyrocket like transit fares but is definitely too low for what we're asking of it. It's not even a matter of fairness; they have avenues to make forward progress on it that the T doesn't, and these agencies aren't independent fiefdoms anymore barred from sharing the pain.


In a lowered expectations era, I think our best hope is for the Legislature to do these financial transactions in the immediate term, cut the cord on MBCR for 2013 and bring the commuter rail in-house where it's cheaper and more accountable to run a system this size, and then keep the pressure on for the much tougher fights of addressing forward funding, labor, and structural reform. It gets the agency off its deathbed with just enough relief to function and buy a couple years' time for when the pols are hopefully a little more motivated to make actual changes.
 
Re: Driven By Customer 'Service' Parte Dos

Ron Newman said:
And this is why the MBTA should consider default as a preferable option to either service cuts or fare increases.
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Ron -- you are starting to sound like some of the others who are commenting without thinking

If the T was to default -- no one would ever loan a $0.01 to fund any of the proposed projects to expand the facilities

In reality -- ultimately, the T can't default as it is an entity of the Commonwealth -- the full faith and credit of the taxpayers is connected to the T -- unless the Commonwealth goes down the tubes

The best bet would be to:
1) Have the Commonwealth refund the bonds currently backed by T revenues with General Obligation Bonds which are directly tied to our taxes -- taking the Big Dig related and other depth off the table
2) Restructure the work agreements (that's part of the reason for the barrels full of $80k plumbers)
3) Like a bankrupt airline -- have the T restructure the hiring so that new hires got only 401-k type defined contribution payments with partial match by the T and that health benefits stop when the person retires at the ripe old age when social security and medicare kicks in
4) Restructure the governance of the T's operational spending and capital borrowing so that the cities and towns within the R's Service area have a way to control what they have to pay for and can help decide expansion / contraction decisions
 
Re: Driven By Customer 'Service' Parte Dos

F-Line to Dudley said:
Yup. And that Big Dig debt is $100M on each of those payments. That's $98M in revenue they can't spend on the system.

The debt was a defensible assignment on the MBTA when it would've made the Turnpike Authority's debt service untenable. That's moot now with MassHighway absorbing it and the EOT taking a bigger role over the T, MassHighway, DCR, and Massport as a centralized agency.

In a lowered expectations era, I think our best hope is for the Legislature to do these financial transactions in the immediate term, cut the cord on MBCR for 2013 and bring the commuter rail in-house where it's cheaper and more accountable to run a system this size, and then keep the pressure on for the much tougher fights of addressing forward funding, labor, and structural reform. It gets the agency off its deathbed with just enough relief to function and buy a couple years' time for when the pols are hopefully a little more motivated to make actual changes.
Click to expand...

F-Line -- This is the time to make any kinds of major adjustments -- the current crop of Legislators are as fearful for their sinecures as possible given the current climate -- the threat of service cuts or huge increases in fares is the motivator

Hit em Now! and Hit em Hard!

'It aln't Mr. Bulger's T going forward -- things have to change and they have to change now!"
 
Re: Driven By Customer 'Service' Parte Dos

MBTAddict said:
This is the MBTA 2011 payroll. You can check out what they pay everybody from management to bus drivers and subway operators.

http://www.bostonherald.com/project...ta&action=get_data&payroll_search=&job_title=
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Yikes - these payroll figures are enough to give Rifleman a heart attack. One cop who is a regular patrolman had gross earnings of 170k last year. Among many many others, the MBTA has "painters", "wirepersons" and "surface operators" making well over 100k.
 
Re: Driven By Customer 'Service' Parte Dos

202 full time customer service agents, most with a salary of 61k. What do they do exactly and why does the T need 202 of them?
 
Re: Driven By Customer 'Service' Parte Dos

Justin7 said:
202 full time customer service agents, most with a salary of 61k. What do they do exactly and why does the T need 202 of them?
Click to expand...

Help tourists use the FVMs and give directions at nearly every station.
 
Re: Driven By Customer 'Service' Parte Dos

@F-Line, thank you for mentioning MBCR. That agency is outrageous. Several years back Amtrak held the contract for the commuter rail, so this is nothing new. However, once Amtrak leaves, MBTA decides that they will pay some company that is created specifically for the purpose of operating the commuter rail. Number 1, the MBTA ought to be able to provide those services internally, especially considering that MBCR isn't even a large firm. The commuter rail and the MBCR are essentially the same, but for some reason somebody needs to profit along the way.
@found5dollar, if it is true that they pay $452 million in debt service, then the state absorbing this cost, as they should, would essentially fix the problem. The issue is that the political cronies at MassDOT have no interest in actually looking at the way the organization runs and would prefer to put the burden on mass transit users. Now that Davey is the head of MassDOT, this could improve the way the agency works...
 
Re: Driven By Customer 'Service' Parte Dos

Lurker said:
Unfortunately the MBTA's debt problems go beyond a pension and benefit agency for select management. A combination of poor management by hacks and the legislature dumping the Big Dig debt onto the agency added the majority of the debt service which is now sinking the system into a cesspool of doom. While the unions need to be reigned in or eliminated, and the cronyism of various positions stamped out, the major issue is moving the majority of the debt back onto the state ledger. The state dumped most of the current debt on the MBTA or at least created an environment to exponentially explode it with cronyism, therefore the state should be required to clean up the mess it made.
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My boss said the exact same thing today. I also want to add that in addition to this, another reason is the expansion. While the MBTA is obligated, through the Big Dig project, to expand services, there are not enough people in the area of expansion to justify the use of additional station. There is a reason why the MTA in NYC is train heavy while Boston is bus heavy. In NYC, there are enough density to justify the cost of running a heavy rail through many of the area (the MTA may be in a billion dollars in debt but this is due to the fact that it is on wrong side of the economic of scale, i.e. it's too big). In Boston, there is not nearly enough people so the MBTA utilizes feeder buses to stations so that it can generate enough ridership for the station. In this sense, MBTA would also need to shrink or wait until density grows (with transit oriented development).
 
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