Changes are brewing in Boston: with a new commuter rail operator in place, the relocation of a vital rapid transit line under way, and a proposed fare hike on the horizon, MBTA has its hands full - Massachusetts Bay Transportation Authority - Michael Mulhern - Interview

Railway Age, July, 2003 by Christopher Ytuarte

It boils down to this: The financial situation surrounding the system will rely heavily on the 25% fare increase scheduled to go into effect in January. After the fare hike, we will still be one of the lowest-fare transit systems in the nation. But the additional revenue will give us the resources to pay down our debt and continue with the investment program.

RA: Do you foresee a shortfall in state and federal funding?

Mulhern: We've been following the budget problems nationwide very closely. Two-thirds of the transit properties in the country are raising fares or have raised fares. Boston is no different. Although we truly need the fare increase that is pending in January, we have the luxury of time. We announced it nine months in advance. We've budgeted for an extensive public hearing process, through which we'll have a good dialogue with the people who ride MBTA everyday, and allow them to hear about our plans and comment on them.

From an operating perspective, it's important to get through this year's budget cycle with those funds. We do have a shortfall in our budget for this year, and if we don't get it we will have to cut service. However, having said that, folks are going to ask me, "Why is this fare increase important?" Short-term, it is absolutely essential for operating purposes. We have about a $25 million shortfall that the fare increase will solve. However, we get 20% of the State of Massachusetts sales tax. And when sales tax receipts rebound, those revenues will begin to climb again. The point is that although the fare hike will get us through a short-term problem, it's far more important to us from a capital investment perspective than it is for operating reasons. We'll get to a point where, hopefully, we'll stay even with our operating budget requirements through non-fare revenues, although we're operating on a shoestring there.

The fare hike does two things: It puts us in a comfortable situation that allows us not to have to worry about cutting service from budget cycle to budget cycle. But it also allows us to address the issue of the debt and continued investment. To put things in perspective, although we're talking about a wide array of services with a wide array of fares, we have a dollar subway ride, we're going up to $1.25. And commuter rail will see a similar increase systemwide, but that's based on travel zones.

RA: Are current and near-future projects adequately budgeted for?

Mulhern: Yes. We're fully programmed and fully funded over the next five years. We're really looking beyond that five-year horizon, and our financial plan is predicated on bringing in the resources to continue to do just that. Every year we go out with our capital improvements program under a five-year umbrella, but every year we refresh and update the program. So anything in that five-year program is always fully funded.

No more noise

The MBTA is facing a civil lawsuit filed by residents of Beacon Hill, one of Boston's oldest neighborhoods and a area serviced by Red Line trains. Residents claim that noise and vibration from the subway running below their homes is a nuisance and potentially damaging.