MBTA projects grim budget picture for next fiscal year
“These are creative and somewhat different ways in order to generate revenue. And I think if we are to solve the serious financial problems facing the T, we need to be as inventive as we can.”
The MBTA’s Board of Directors took its first steps Thursday in crafting a budget for the next fiscal year when the beleaguered transit system is projected to face a gap of more than $200 million in its operating budget and limited options for closing the shortfall. The estimated operating deficit has been on the T’s radar since 2020, though the agency has so far balanced its spending plans with federal pandemic relief dollars and money from its rainy day fund.
In the fiscal year beginning next July, however, federal COVID-19 relief funds won’t be an option, and T leaders have said they are reluctant to reduce service or increase fares out of concern that such measures would derail efforts to restore ridership to pre-pandemic levels. Further complicating plans for the next budget are pressures from the unprecedented, month-long shutdown of the Orange Line and the Federal Transit Administration, which issued a scathing report last month that ordered the MBTA to hire more staff, improve communication with front-line workers, and bolster safety checks.
“Given the current expense structure and the T’s core mission, solving for the T’s future budget gap is difficult at best,” T Chief Financial Officer Mary Ann O’Hara said at a meeting of the board’s audit and finance subcommittee. Her overview of the T’s finances showed a transit system bound by the fixed cost of providing service, heavy payments on debt service for capital projects, and expenses still being tallied to address safety issues identified by the FTA.
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