Gov. Maura Healey's recently tapped MBTA directors peppered agency officials with questions Thursday about budget woes and safety initiatives as they strive to get up to speed on the agency's inner workings.
Board member Tom McGee, a former senator and former mayor of Lynn, requested data spanning the last two decades on the agency's allocation from the state sales tax, one-time funding needs and other challenges to offer a "historic perspective" into the budget shortfalls that have dogged the agency, along with safety failures that have been chronicled by federal investigators.
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McGee, who co-chaired the Transportation Committee in the Legislature, forecasted a "pretty sobering several years ahead."
"I know we all want to make sure we're taking it on in the right way," McGee said during a virtual MBTA Board of Directors Audit and Finance Subcommittee meeting Thursday morning.
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Confronting a $366 million fiscal 2024 budget gap, the MBTA plans to pull $261 million from its deficiency fund reserves, or $9 million less than expected last November, said CFO Mary Ann O'Hara. The strategy is needed to "not further deteriorate our financial outlook," O'Hara said. Other funding sources -- such as one-time state appropriations tied to the Federal Transit Administration's safety directives -- will plug the rest of the shortfall, she said.
Annual operating expenses are expected to exceed operating revenue for the next five years, with one projection showing a budget gap topping $540 million in fiscal 2028, O'Hara said.
The MBTA's fare revenue recovery ratio is pegged at 19% for fiscal 2024, meaning operating expenses are outpacing revenue growth due to decreasing ridership, O'Hara said. That compares to 43% in fiscal 2019, before the COVID-19 pandemic.
"Now while the recovery ratio may seem like a fraction of an amount, it is still hundreds of millions of dollars -- it's well over $400 million to support the billions of dollars that we spend to run the MBTA system-wide," O'Hara said.
Thomas Glynn, the new MBTA board chair and a former MBTA general manager under former Gov. Michael Dukakis, questioned whether the agency is adequately funding elevators and escalators, as he mentioned a backlog in maintenance.
The NBC10 Boston Investigators recently covered that concern, finding multiple escalators out of service at stations across the system.
Glynn also asked how the agency's debt burden may still be impacted by the Big Dig; an official said that as much as $1 billion is still outstanding.
The MBTA expects to make more than 2,500 new hires in the coming fiscal year, while pursuing "major investments" in safety and training that will quadruple previous agency efforts, O'Hara said. In response to an FTA safety directive, O'Hara said the MBTA will conduct a workforce assessment analysis to figure out what size workforce is needed to "provide services and manage the organization."
The budget will grow by 6.8% in fiscal 2024, with safety and training investments increasing by more than $170 million, O'Hara said.
Eric Goodwine, Healey's other new appointee and vice president of Rockland Trust, asked MBTA officials to follow up to his queries after the meeting. He sought more information on whether some of the FTA safety directives had already been on the MBTA's agenda, as well as an analysis of what the fare revenue recovery ratio could be should ridership increase after 2024.
As the meeting neared the one-hour mark, Goodwine had to halt a presentation about the MBTA's five-year capital investment plan, which is placing a new emphasis on safety and security in prioritizing projects. After the subcommittee approved a new investment policy ahead of a full board vote later this month, Glynn recommended extending meetings to allow for more discussion and question time.
"There's a lot of important items that are on the table -- we didn't really have time to sift through them," Glynn said.
Goodwine agreed, suggesting tacking on an additional 30 minutes to future meetings.
"These matters are very important, and we need to be allocated the appropriate amount of time to go through the presentation and be able to ask our questions," Goodwine said.
