Study: T fares could rise sharply without state help
by Galen Moore, Boston NOW
October 17, 2007
Fares on the T could rise sharply within five years if the state doesn't help the MBTA pay down its massive debt, according to a study released yesterday.
In a study titled "Derailed by Debt," the Massachusetts Public Interest Research Group (MassPIRG) predicts that without state help, a "downward spiral" is inevitable as fare increases and service cuts reduce ridership.
"We're not talking about 10, 20 years from now," MassPIRG consumer advocate Eric Bourassa said. "The [deficit] just gets bigger and bigger. What's creating the deficit is their debt service."
The MassPIRG study is based on state Transportation Finance Commission findings. In September, the commission recommended the state take over $1.8 billion in debt related to the Greenbush Commuter Rail expansion, the Silver Line and other projects required to mitigate the Big Dig.
The problem is getting attention at the highest levels of government.
Gov. Deval Patrick is developing a "reform package" to support better finance and management of the state's transportation system Executive Office of Transportation spokesman Erik Abell said yesterday. "Too many of our dollars are going to debt service instead of real service."
MBTA General Manager Daniel Grabauskas, didn't specifically address the report yesterday, but acknowledged the financial challenges could have consequences.
"If a solution to the long-term financial problems imposed upon the T is not identified, the transit improvements sought by so many people cannot be realized," he said.
A legislator who is working to help pare down some of the T's debt said the burden on the transit agency is too much.
"Having 27 percent of the budget go to debt service is unheard of when you look at transportation systems nationwide," Rep. Carl Sciortino, D-Medford, said.
Cost savings are important, he said, but debt reduction is "front and center" among MBTA fiscal issues. Sciortino was among legislators who filed a bill this year that calls for taxpayers to assume responsibility for the T's Big Dig debt.
The head of a taxpayers group said spreading that responsibility to everyone is only reasonable if the T can cut costs, especially its generous employee benefits.
"We certainly support some debt relief," said Massachusetts Taxpayers Foundation president Michael J. Widmer, who served on the Transportation Finance Commission. He noted an area that needs trimming is the health care plan for employees and retirees.
By doing so, the T could save about $55 million a year - about half again what they would save if the state took over the $1.8 billion in Big Dig debt, Widmer said.
The T will take 65 percent of its operating revenues from local and state taxes this year, but it's not unreasonable to seek more, said Professor John Collura, director of the transportation engineering graduate program at UMass Amherst.
Collura said tolls from area bridges and roads should go to support public transit, as they do in New York and London.
"I'm not limiting it to general tax revenue," he said. "We need to be creative."