Five Reasons Why Transit Privatization Is Bad For Massachusetts

  1. imagesscrewed-smallPrivatization does not guarantee savings. Proponents of privatizing transit often make lofty claims about savings through private sector efficiencies. But frequently these claims couldn’t be farther from the truth. Public agencies are often more efficient because no profit margin gets siphoned off to shareholders.
    • In Phoenix, Veolia demanded an additional $27.5 million on top of its existing $386 million contract. Veolia threatened to leave on short notice during contract negotiations if the city did not meet its demands.
    • Veolia was dropped after 3 years by Chatham Area Transit (CAT) in Savannah, GA after the CAT chairman concluded that the private operator “was becoming too expensive.”
  2. Service issues may rise: any savings often come from cutbacks. Contractor claims about service should be taken with a grain of salt. Up-front savings are often coupled with cutbacks, hurting the most vulnerable users like the disabled and children.
    • In San Diego, First Transit promised $10 million in annual savings by taking over the North County Transit District. Modest cost declines were primarily due to service cutbacks. First Transit operated 14,000 fewer service hours while other costs shot up by $1.4 million primarily due to administrative fees.
    • In Nassau County, NY Veolia slashed service to close a $7.3 million budget gap. More than 30 routes saw cutbacks, in all 60% of the system experienced service declines.
    • After 19 years of privatized service in the Toledo, OH area, paratransit riders complaints were so numerous that the agency fired First Transit.
  3. Privatization can undermine safety. Private bus operators are known to have less experienced drivers (due to higher turnover) and more mechanical difficulties (due to inadequate maintenance). These can present enormous safety hazards to riders.
    • In Denver, private operators running buses side-by-side with publicly operated buses had a worse safety record.
    • In Houston, news media reports indicated that First Transit operators were responsible for a number of high profile accidents, injuring car passengers and pedestrians.
  4. It could leave us open to more political corruption. The Taxpayer Protection Act was specifically passed to deal with the corruption that was going on during the Weld administration. We do not want to go back there, but the Baker administration has opened the door by repealing this important safeguard. Contracting out transit services could lead to corruption making the politically connected wealthy on the backs of taxpayers.
  5. Many private operators have poor track records. Privatization will require efforts to keep a watchful eye on public money. Keeping companies accountable requires more oversight and resources than with a public agency.
    • In Denver, private contractors were replaced 3 times in 3 years requiring enormous transactions costs as the agency had to find a new operator for transit services.
    • During a 3-month period in 2011, Veolia was fined $3 million for poor performance, primarily due to buses running late. Unfortunately, most of these fines were waived and Phoenix riders were left with substandard service.
    • In Roanoke, VA, a 2009 audit of the Greater Roanoke Transit Authority showed that First Transit misused $70,000 in taxpayer money. The General Manager billed the city for more than $14,000 spent on golf, cigars, alcohol, and fine dining.


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    • Evil Genius on September 28, 2015 at 9:25 am

    I think 589 should start publicly attacking Baker using DCF… WHO’S CHILD WILL BE THE NEXT BABY DOE UNDER HIS WATCH???

    • j cat on September 24, 2015 at 10:35 am

    You could write a book about all the failures of privatization in the transit world.

    basically its short term gain long term pain.

    employees payed low wages and treated very poorly, very what happens is they just don’t show up.. trips are dropped after all its a low pay part time job with little if any benefits.

    then you get into the lack of preventive maintenance of the equipment ,which causes huge costs later , which we the taxpayers will have to pay to fix.

    then they will say YOUR equipment is junk .. Its your fault we could not make service.

    So even if you are anti union , if you use the public transit , you will not be happy with these privatized companies..

    Its all about the deals/ pols … rebublicrats !

  1. […] Wednesday night, members of of the executive board along with Local 589 members, other MBTA unions, various community groups, and T riders joined together outside South Station, Downtown Crossing, and Park Street T stations to educate riders about the dangers of privatization. […]

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