The MBTA does have a financial problem—it deals directly with the finance plan that was developed seven years ago during the so called Forward Funding transition. In fact, many people on this Commission had substantial input into the Forward Funding legislation.

Today, we are here to address the report because you determined that the Forward Funding plan doesn’t work, after just seven years.

Even Charles Chieppo of the Pioneer Institute and former MBTA Blue Ribbon Commission Member concedes in an Op-Ed piece in the Boston Globe that appeared April 19th 2007. “The agency paid more in debt service last year than it collected in fares. When debt service is included, fares cover just over a quarter of the T's costs.” 

The problem is that the MBTA has been running on a credit card for decades. In year one of the forward funding transition, the MBTA was handed $4 billion dollars worth of debt to pay down. The principal and interest payments came out of the annual operating budget of the MBTA and totals almost $400 million dollars per year. In fact, during the first year of the transition, the MBTA was forced to borrow over a half billion dollars to finance operations for the first year.

During Forward Funding Assumptions were made that growth of the MBTA was assumed to be 2.5 % per year. To state that these assumptions were fool-hardy is an understatement. No public agency in the State of Massachusetts has controlled its expenses to a rate of 2.5% per year without substantially cutting services.

You correctly point out that the MBTA maintained a 5% growth rate of its annual budget over the last seven years despite double-digit growth in health care costs, fuel and electricity costs and materials/supply costs.

A 5% increase despite run-away costs in key line items at the MBTA. Rather than criticize the agency, I think it deserves a little credit—particularly, the workers. Let me talk about that for a minute.

When it became clear that the agency was not going to be able to balance its books five years ago because of the assumed sales tax revenue growth projected in the forward funding scheme had not been realized. It was the Unionized work force of the MBTA that stepped forward. 

For the first time in the agency’s history, the Unionized workforce negotiated a contract that contained a wage freeze in its first year and with annual raises averaging 2 ¼ percent—well below the 5% overall growth in costs at the agency during the same time period.

Today, rather than acknowledge that fiscally sound contract ratified by Unionized MBTA workers, this Commission is critical of my members and the benefits they receive, in fact this commission appears to go to great lengths to attack MBTA workers’ benefits.

Let me be clear about one thing— front line blue uniform employees at the MBTA are hired on a part- time basis for anywhere from one to five years at the beginning of their career. Part – time employees also work split shifts most work day schedules require a 13 hour commitment for six hours pay. Once attaining a full-time position, a bus driver makes approximately $50,000 per year working nights, weekends and in parts of the city where even a police officer is not required to respond alone. The MBTA should be willing to offer these workers a fair compensation package, including a secure retirement. Because I’ll tell you, if you didn’t have a responsible employee driving these buses, you would end up with a transient work force and be left with workers who are not as skilled or professional as the workers you have today and you would be confronted with the fact that workers would come and go like they do in much of the private sector today.

Let me take a moment to address the health care issue as it was raised by the commission. Simply stated, health care costs are not a Boston issue, a Suffolk County issue, not a Massachusetts issue nor a New England Issue, Health Care Costs are a National Crisis. 

Finally this Union finds it ironic that as the MBTA reaches its height of workforce diversity the wages and benefits available to these diverse workers are targeted for attack.