Craig F. Walker/Globe Staff/File 2016
As it embarks on major projects like the $2.3 billion Green Line extension and a replacement of its fare system, the MBTA is reckoning with an old Achilles’ heel: keeping outside contractors in line.
In the past few months, the Massachusetts Bay Transportation Authority has:
■ Acknowledged it should have kept a closer eye on the company behind the long delays in providing the Ride service for passengers with disabilities.
■ Withheld payments to the firm managing its parking garages.
■ Singled out shoddy construction work on a rail safety project as an example of “contractors run amok.”
■ Renewed criticism of its largest outside contractor, Keolis Commuter Services, operator of the commuter rail system.
But with the Green Line extension and a $723 million contract to install and run a new fare-collection system coming, officials acknowledge they need to get better at riding herd on contractors.
“It’s a skill set to be able to work with a vendor,” said Transportation Secretary Stephanie Pollack. “The necessity of doing a better job is clear, both from what’s been going on with the Ride and what’s been going on with commuter rail.”
The MBTA’s oversight of vendors took on additional importance during a three-year window when the Legislature made it easier for the T to outsource services traditionally carried out by public employees. The provision — a three-year exemption from the so-called Pacheco Law that ends in July 2018 — has sparked skirmishes between the Baker administration and public employee unions.
Even before the Pacheco exemption, the MBTA had long worked with contractors to operate commuter rail and the Ride and to perform other functions, including nearly all construction.
“The T needs to be an organization that knows how to manage contracted services,” Pollack said. “That would be true if there was never Pacheco relief.”
Still, the recent contract problems have bolstered the critics, such as unionized MBTA bus mechanics, who are fighting a proposal to outsource maintenance at three of the transit authority’s nine garages to a private company.
“It’s one failed example after failed example. They keep saying, ‘We’ll get it right the next time,’ ” said Michael Vartabedian, business manager for the bus maintenance union. “I don’t think they’re capable of managing a contract.”
The MBTA hopes to change this criticism, an old one that has persisted despite the Baker administration’s efforts to overhaul the T following the collapse of service during the winter of 2015. In an end-of-year report to the Legislature, the MBTA’s governing board highlighted contract implementation and oversight as an area where the T still struggles.
Now it’s hiring executives and middle managers to keep a closer eye on contractors. The board also suggested the T require more consistent reporting from contractors and clearly define penalties and termination rights. “A lot of these things have happened under the board’s watch, so I think we want to be better,” said Joseph Aiello, the board’s chairman.
At the commuter rail system, a former MBTA general manager, Dan Grabauskas, was recently hired to keep a closer watch on Keolis.
Keolis has had a rocky tenure since taking over from another private contractor in 2014, and the T has said it will not pick up an optional contract extension in 2022. In October, Pollack criticized the consistency of Keolis’s service on the 12 commuter lines.
Grabauskas came on board in September, during heightened tensions with Keolis. The MBTA had accused Keolis of flubbing an investigation into the uncoupling of two train cars on the North Shore, making it difficult to determine the cause. Keolis told the Boston Herald that it gave the T adequate information about the incident.
Yet there were also disagreements within the MBTA about how hard to crack down.
“My team has to work with these folks every day,” the T executive who works most closely with Keolis wrote to a safety official who had fired off a harsh letter to the train operator. “It becomes very difficult to meet the expectations of our ridership and deliver service when another part of MBTA sends out a letter as pointed as the one you sent.”
Grabauskas’s job is to improve coordination with Keolis and boost service on lagging rail lines. Keolis spokesman Tory Mazzola said the “relationship has grown stronger” since Grabauskas arrived “and includes daily interaction that is constructive toward our shared objectives.”
Transit authorities must walk a fine line while overseeing contractors, said David Bragdon, who runs an advocacy group, Transit Center, that recently published a guide to contracting practices.
“They have to have enough internal expertise to judge whether the contractor is performing, but not so much that they’re duplicating the contractor’s work or second-guessing everything,” he said.
When the T has failed to keep a close eye on contractors, the results have been costly.
In 2015, the project to extend the Green Line to Somerville spiraled over budget by as much as $1 billion. Officials said contractors took advantage of rules to essentially name their price, and got away with it because the T had few staffers overseeing the work. It fired those contractors, installed an internal oversight team, and used a new contracting method that limits how much a contractor can earn.
The 4.7-mile project is scheduled to start this year and be completed in 2021. The work is being done by private companies led by Fluor Enterprises.
The T is also terminating its relationship with Global Contact Services early over management of the Ride service. Numerous passengers with disabilities complained they had waited hours to be picked up.
Officials said their willingness to fire the company proves the MBTA is holding poor contractors accountable.
Yet the transit system’s general manager, Luis Ramirez, acknowledged the T had its own lapses with Global Contact — failing to closely monitor on-time performance. He said the T has to get better at recognizing risks and plans to hire a chief risk officer to analyze potential contract problems.
And as of December, the T had withheld $158,000 from its parking lot vendor, Republic Parking, while it assesses the company’s performance. Weeks earlier the T fired the manager who oversaw the parking contract, David Friend, who issued a scathing letter, published by Commonwealth Magazine, that accused the T of failing to hold Republic accountable on several matters, such as overspending on staff and buying plow trucks that were too big to fit in MBTA garages.
The MBTA noted that parking revenue was up 4.7 percent this fiscal year. Republic said Friend is “a disgruntled ex-employee.”
Still, MBTA spokesman Joe Pesaturo said Ramirez hopes to “refine the contract and sharpen standards” for Republic — which took over in 2017 after the previous vendor was fired for stealing millions of dollars.
The next big contract decision could come early this year, on outsourcing work at some bus garages.
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