Reviews of Governor Baker’s first year in office, capped off by General Electric’s decision to move its corporate headquarters to Boston, have been largely positive. A more important marker to evaluate his long-term performance began six months ago, when the Legislature passed significant MBTA reform.
In short order, the legislatively created Fiscal and Management Control Board, or FMCB, has curbed operating-cost growth by 80 percent and taken “own-source” revenue from negative territory to growth of 16 percent, saving $50 million in this year’s operating budget.
Curb your enthusiasm. The T had projected a $242 million 2017 deficit — even when assuming a 5 percent fare hike. Saving $50 million neither stems the tide of deficit spending nor allows the T to address longstanding deferred maintenance challenges.
Assessing the root causes and proposing solutions to the T’s plagued finances have been priorities for the FCMB. It has delivered a comprehensive public diagnosis of the T’s ailments.
For instance, the FMCB has demonstrated the need for a complete rethinking of The Ride, the MBTA’s paratransit service for elderly and disabled riders, shown that MBTA bus maintenance costs far exceed those of comparable systems, and lifted the lid on gross employee absenteeism.
Outsourcing bus maintenance and ending The Ride’s seven-year $916 million contract with three large vendors — instead, embracing taxis, Uber, and Lyft for the 80 percent of trips that don’t require wheelchair accessible vans — will save another $100 million in annual operating expenses.
But modernizing the T must touch every aspect of the organization, including its management. The Green Line Extension fiasco alone underscores that management deserves real — even harsh — scrutiny.
Given that the FMCB has just a three-year window within which to operate, it’s time for the hard decisions. I’m all for making the difficult decisions that come with modernizing the T’s antiquated operations.
But such decisions are best guided by explicit principles. Here are two I’d propose:
Customers come first, especially riders with limited options. At a December meeting of the FMCB, a proposal was floated to cut existing paratransit service outside the federal Americans with Disabilities Act-mandated area of three-quarters of a mile from fixed-route service. The impact on individuals with disabilities and those who had based housing decisions on access to The Ride would have been significant. And $5 million of the annual cost savings ($11 million) associated with the change can already be achieved by replacing the three large vendors mentioned above.
The FMCB ultimately did the right thing and did not disrupt the lives of The Ride’s existing customers. Therein lies the urgency of moving to lower-cost, equal-or-higher-quality options to maintain important services.
Fare increases should be linked to demonstrable service improvements. The customer must also come first when it comes to fare increases. The T cannot ask riders to pay more unless it offers better, more reliable service in return.
No progress will be made at the MBTA until management accepts that it can no longer rely on bailouts from the legislature or sizable fare increases to close budgetary holes. Only when it recognizes that it must earn increases through better service will a change in organizational culture be possible.
Urgent action on reform and an insistence on fair treatment of MBTA customers are crucial if the FMCB is to sustain traction for its reform agenda. After all, its real power lies in the support the governor has thus far enjoyed from the T’s 1.3 million daily riders.
The governor and the region’s economic prosperity have a lot riding on whether the FMCB can make measurable progress in modernizing the T. In moving this important work forward, my advice is to stick with the riders, and that means the FMCB must go faster on reform and slow down on fare increases.
Jim Stergios is executive director of the Pioneer Institute, a Boston-based think tank.