MBTA details ‘poorly and inefficiently run’ cash-counting operation

Kieran Kesner for The Boston Globe

The Massachusetts Bay Transportation Authority’s cash-counting operation has twice the number of workers typically employed by private companies in the industry, but MBTA employees often complete just a fraction of the work they should compared with the industry standard, according to a consultant hired by the agency to evaluate the department.

For example, workers at the T’s so-called money room collect money to be counted from just nine locations a day on average, while workers at private companies can visit 40 locations, said Shellie Crandall, chief operating officer of Illinois-based 4Demand.

Transportation Secretary Stephanie Pollack called the 78-worker department “poorly and inefficiently run.” The critical audit, set to be presented at an MBTA board meeting Monday, is being released as the agency moves to privatize several departments to save money.

“The T is in the business of moving people, not money,” Pollack said. “That’s our core competency. That’s where we want to put our efforts.”

Crandall, who has been paid about $50,000 for her work to date, said she was struck by the lack of efficiency and structure in the money room.

“The biggest shock was nobody’s measuring whether they’re efficient or not,” she said. “At 2 in the afternoon, I could go into that cash room and there’s nobody working.”

The MBTA counts close to $200 million in cash a year through its Charlestown money room, and spends about $10 million a year to employ its 78 workers. That includes drivers who pick up money from vending machines, those who unload the money from armored trucks, and people who count the cash itself.

T officials believe they can save about $4.6 million if private companies take over the operation. They could ask companies for requests for qualifications or proposals as early as this week. After a contract is awarded, the transition could take one to three months.

Crandall, who spent much of her career working for private cash-collection and armored-car companies, last week criticized the operation’s safety standards. She described doors that were not properly monitored or alarmed and duct-taped vault doors.

But she also expressed shock at the efficiency of the department: Workers rarely tracked what stops and pickups they completed on their routes, staff frequently deviated from their routes, and workers were not properly sorting cash.

Crandall also found what a 2012 auditor’s report had criticized: The T’s software and hardware made it impossible for workers to properly reconcile how much cash their fare boxes say they collected, and how much they actually deposit.

The T’s training standards are also lax, according to the audit. Crandall said some of the workers — often former bus drivers — drive armored cars, but she said they do not appear to have been trained in driving them, or how to act in case of an emergency.

The T and Crandall took aim at the operation’s unionized management structure, arguing that unionized managers lack accountability to the top echelons of the agency. In recent months, officials say, they have placed executives — who are typically not in unions — in charge of the operation.

Crandall also said union work rules made it harder for the agency to be its most productive, noting that workers are often allowed to choose tasks that didn’t fill a whole shift.

“When we want to make changes in how we manage things, it is more complicated than it would be” without unionized managers, Pollack said.

Crandall made it clear she believed privatizing the department would improve the operation. Some specialized businesses are no longer doing cash-collecting on their own, shifting that responsibility to other companies. Bank of America and the Chicago Transit Authority have both outsourced their cash collection operations, she noted.

Pollack said the agency could spend more money to improve the department, but she believes the T should be focused on improving service for riders instead.

The T has spent about $4.7 million in capital funds over the years to build and fix the office, and purchase cars for the operation — money that T officials said they would rather have go to other changes at the T, such as repairs.

Agency officials have put many of those investments on hold as they seek to privatize the department. For example, the T owns about 15 armored cars, including two that haven’t even been used yet. Officials said they didn’t want the cars used in case they wanted to sell them off after privatizing the department.

The talk of privatization has apparently pushed many workers to take the buyouts that the T offered this summer. About 20 percent — 15 of 78 workers — plan to take the incentives to leave, said Nicholas Easley, director of flexible contracting at the T. In all, nearly 250 workers could leave the agency in the coming months, according to the T.

The money room has been a target of privatization in the past: In the early 1990s, the T and then-Governor William Weld wanted to outsource the jobs. At the time, lawmakers passed the so-called Pacheco Act, named for Senator Marc Pacheco, which put up hurdles to privatizing jobs. The T’s workers then won a bid to continue operating the cash-counting operation.

But the Pacheco law won’t be a hurdle after Governor Charlie Baker, a Weld protégé, pushed the Legislature to temporarily suspend the law specifically for the T. Since then, the agency’s chief administrator and new acting general manager, Brian Shortsleeve, has been clear that he wants to privatize several departments.

The T’s largest union, and particularly its president, James O’Brien, has since accused the agency and Baker of “privatization at any cost.”

Asked about the money room, O’Brien said the T was blaming employees after failing to invest in its own system for decades.

“We have been asking MBTA management to provide proof of cost savings for months and have yet to see hard evidence that handing over this public service to a private company seeking to make a profit will in fact generate any real cost savings,” he said. “Public transportation systems should be kept public, not outsourced and privatized.”