|©2011 Boston to a T|
Unless you have been living under a rock for the past few weeks, you have probably heard about the service cuts and fare increase that theMBTA is proposing for their next ﬁscal year. This topic has not only been the center of many newscasts and newspaper articles but it has also taken to Twitter, Facebook, and many other social media platforms in the hope that the MBTA will listen to their riders.
The MBTA, the only transit authority in the United States to have a debt over $8 billion (including interest,) has come to the conclusion that they will have an over $180 million shortfall for next ﬁscal year (FY 2013). Due to this shortfall, (and the realization that all other revenue options have run dry,) the MBTA has been left no choice but to draft two scenarios that will drastically change MBTA service as we know it today.
You're probably wondering how on earth they racked up such a massive debt, but it wasn't all the MBTA's fault. It is true that some of the debt was added because of large projects and mismanagement, but the bulk of it was acquired after the turn of the millennium.
In 2000, the MBTA was "reborn", if you will. The Commonwealth of Massachusetts passed a Forward Funding legislation which set aside 20% of the state's sales tax revenue to the MBTA. Along with this revenue stream, the Commonwealth also transferred around $3.3 billion worth of debt from the state's books over to the MBTA's books. This transfer also included around $1.8 billion in Big Dig-related debt.
Also, unlike the MBTA had hoped, the sales tax revenue has increased minimally since 2000. The tax, which was supposed to grow at a rate of 3% per year after 2000, has, on average, only grown about 1% per year, which created a sales tax revenue shortfall of $100 million in FY 2011, and a $375 million shortfall since the start of Forward Funding.
Over the past year, MBTA ofﬁcials (Interim General Manager and CFO Jonathan Davis & MassDOT secretary Richard Davey) have been trying to close the expected budget gap with non-fare revenue and cost-cutting solutions. Some examples include advertising on MBTA.com and soon even the Charlie Card. The MBTA also opened an online store selling everything from shirts to vintage station signs for profit. They have also eliminated positions, reduced overtime spending, and changed employee health care providers all in the hope of ﬁnding a little bit of cash. The T had hoped that all of these savings would help close the shortfall, but as most of you know, it has not. For this reason, the MBTA is now looking at fare increases and severe service cuts to solve their problem.
The MBTA currently has two scenarios that are being proposed for service cuts and fare increases. Scenario 1 has a higher fare increase, but less impact on service and Scenario 2 has more service cuts with a lower fare increase. Here is a breakdown of the two scenarios:
Summary Impact of Proposed Changes
Overall Fare Increase(all fare media types)
% of total currentridership
34–48 million annual trips9 to 13%
53–64 million annual trips14 to 17%
Gain $161 million in annualrevenue (+34%)
$123.2m increase in farerevenue
$38.3m net operating savings
Gain $165 million in annualrevenue (+35%)
$86.8m increase in fare revenue$78.4m net operating savings
Scenario 1 will bump the cost of a one-way subway fare with a Charlie Card from $1.70 to $2.40 and bus fare from $1.25 to $1.75. Scenario 2 will be slightly less, with subway increased from $1.70 to $2.25 and bus fare increased from $1.25 to $1.50.
There are many service cuts proposed (full list of service cuts available here) but cuts causing the most controversy are the elimination of Green Line's "E" branch and the Mattapan High-Speed line on weekends, the elimination of Commuter Rail service on weekdays after 10pm and all weekends, and finally, the elimination of all ferry service.
Bostonians have been expressing their outrage about these proposals all over the online world and the topic itself is being tackled by hundreds of bloggers, journalists, and commuters all over the metro Boston area!
Twitter has been at the front of this frenzy with thousands of users tweeting their comments to MBTA officials (@mbtaGM), State Officials (@MassGovernor ), or just out to the world of Twitter hoping that someone out there is listening. Several groups have also formed out of the frustration, such as Occupy MBTA (@OccupyMBTA) a Twitter adopting the moniker of the Occupy Boston movement and Students Against T Cuts (@StudentsTCuts) a group that consists of college students from around Boston who believe that the proposed scenarios are a step backwards in the development of the city and its businesses, people, and institutions of higher education
Each one of these groups and all those tweeting about the subject have different thoughts on what the MBTA needs to do to fix this problem. Some call for the Commonwealth to raise the gas tax or impose high tolls on people driving within the Metro Boston area to help give the MBTA more funding. While this will help bring the MBTA some much needed revenue, it still will not fully fix the financial crisis it is in.
The MBTA needs a fully reorganized financial structure. The underperformance of the sales tax as a principal financing source and too much debt are the true causes of the T's structural weaknesses. Until these factors are addressed, no amount of reorganization or reforms will keep the MBTA from having another budget shortfall in following fiscal years.
If you utilize the MBTA on an everyday rider or just the occasional commuter please "Join the
Discussion". From this link you will find up to date guides that explain the proposed scenarios. You will also find the dates and times of 20 differnet MBTA Public Meetings. These meetings are being held so that the public can tell the MBTA how cuts in service and higher fares will affect them. If you can't make any of the meetings and you would still like to tell the MBTA how you feel, feel free to send them a message. You can email them at fareproposal@MBTA.com.
It is hard to predict what will come of these current scenarios, but overall, they will definitely impose a great deal of change. On July 1st, when the proposals go into effect, Bostonians will no longer be paying $1.70 for the subway, the lowest transit fare in the United States, instead, they face reduced or eliminated routes and increased fares. But how exactly they will affect commuters on a day-to-day basis remains to be seen.
All MBTA financial information came directly from MBTA.com