Proposed Fare and Service Change Public Workshop

Proposed Fare and Service Change Public Workshop

Massachusetts Bay Transportation Authority


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Public Workshop Guidelines

Public workshops provide an opportunity to share comments and discuss suggestions with MBTA officialsTwelve workshops will be held across the MBTA service areaComments and suggestions from all meetings will be considered by MBTA staff and managementPlease be respectful of other attendees and limit your comment length so everyone may have an opportunity to participateSuggestions and comments may also be submitted electronically at [email protected] and at the MBTA website www.mbta.comWritten comments may be submitted by mail to:

MBTAAttention: Fare ProposalTen Park PlazaBoston, MA 02116

A public hearing will also be held at Ten Park Plaza on August 27 Comments at the public hearing will be recorded by a court reporter


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Why Does the MBTA Face a Structural Deficit?

Lower than anticipated revenues from the MBTA’s primary funding source, the sales tax

Increasing annual payments on the $5.2 billion in outstanding MBTA debt

A deteriorating national economy has negatively impacted the financial condition of the MBTA similar to other transit agencies

The deficit is structural and requires a multi-year solution

Non-Fare Revenue

6%Sales Tax47%

Local Assessments

9%

Additional Sales Tax

10%Fare Revenue

28%

MBTA Funding Sources


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Underperformance of the Sales Tax Revenue

Legislation passed in 2000 dedicated 20% of the state’s sales tax receipts to the MBTA

Projections called for a minimum 3% annual increase in revenue Actual sales tax receipts have grown only 1% annually on average No increase in fiscal year 2010

3% Projected Sales Tax Growth and Actual Base Revenue Amounts (BRA)

$842

$767

$600

$650

$700

$750

$800

$850

$900

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Mil

lio

ns

Fiscal Year3% Growth BRA


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Highest Debt Burden of Any U.S. Transit AgencyAnnual payments on the $5.2 billion in outstanding debt consume nearly 30% of the MBTA operating budget

Reasons for Increasing Debt Service:

Lack of growth in sales tax revenues requires more borrowing Sales tax and assessment revenues must cover both operating and capital expenses

Funding of approximately $3 billion in transit initiatives, expansion and commitments related to the Central Artery project

A significant annual minimum investment in the existing system of $470 million per year required to maintain the $2.7 billion backlog in system maintenance and repair projects

-

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

300,000,000

350,000,000

400,000,000

450,000,000

500,000,000

2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037

Senior Sales Tax Assessment Prior Obligations

MBTA System Net Debt Service


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Addressing the Situation: What Is Being Done

Implemented a hiring freeze of non-direct service related positions and instituted layoffs during FY 2009 Reduced headcount by 330 positions

Reduced overtime 17% since FY 2008 and 45% since FY 2005

Lowered healthcare costs Implemented plan design changes projected

to save $5.4 million in the first year Requires for the first time a 10% retiree health

insurance co-paymentCreated operational efficiencies over the past year, saving over $11 million annually

Transportation reform legislation


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What Are the Options for Addressing the Deficit?

Increase revenues by increasing faresReduce costs by cutting serviceImplement certain cost efficiency measuresImplement a combination of above

Considerations:

The proposed fare increase and other cost reductions provide the opportunity for financial stability over the next three yearsMajor service reductions would affect all modes and would result in a large loss in ridership

The $55 million in projected savings from these service reductions would fall short of what is needed to close the budget gap for the next fiscal year


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Summary of Proposed Fare Increase

The overall fare increase as proposed is 19.5% Adult bus fares would increase to $1.50/$2 Adult subway fares would increase to $2/$2.50 Bus pass would increase to $47 LinkPass would increase to $69 10- and 12-ride commuter rail tickets would be eliminated TAP fares will be the same as Senior fares RIDE fares would increase from $2 to $2.50 The 6-day student pass would increase to $28 Tokens will no longer be accepted after December 31, 2009

More details are available in the information book Note that the list of communities with services in the “Suburban

Bus Program” on page 11 should include Dedham


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Providing Comments and Suggestions

We encourage your comments and suggestions related to the fare and service options under consideration

There are multiple ways to submit comments and suggestions At the MBTA website, www.mbta.com Sending an email to [email protected] Written comments may be submitted by mail to:

MBTAAttention: Fare ProposalTen Park PlazaBoston, MA 02116

Attend one of the 12 public workshops to be held across the MBTA service area

Attend the public hearing to be held at Ten Park Plaza on August 27 Comments at the public hearing will be recorded by a court reporter

Documents

Proposed Fare and Service Change Public Workshop