T offers incentives to white-collar workers to cut deficit
By State House News Service | January 12, 2016, 13:20 EDT
BOSTON – The Massachusetts Bay Transportation Authority is reportedly offering retirement incentives to hundreds of administrative employees to shave $30 million to $36 million from the projected deficit in fiscal 2017.
The program would not offer early retirement, but would rather provide an incentive as about 1,000 of the roughly 6,500 MBTA employees are eligible to start collecting pensions – meeting the requisite 23 years of service and 55 years of age, according to Brian Shortsleeve, the transit system’s chief administrator.
About 400 of those 1,000 eligible people are MBTA operators and the program would be geared to encourage retirements of people in non-operational administrative roles, Shortsleeve said. He added that the MBTA is also hiring employees to operate vehicles.
“We’re actively hiring bus drivers. Last week we had a whole new group come in,” Shortsleeve said. He said, “It’s incumbent on us to be actively developing new talent.”
Shortsleeve declined to outline what the incentive would be for those eligible. He said the T would shoot for about 400 departures with 100 new hires to fill some of the vacated jobs – or the equivalent in salary. He said the last retirement incentive program at the T was in 1991.
Department heads are expected to receive a list of eligible employees on Tuesday.
The resulting net reduction of 300 employees could save between $30 million and $36 million in the fiscal year starting July 1. The average cost of the employees to the agency is about $120,000 a year, including pay and benefits, the Boston Herald reported.
The agency currently faces a projected $242 million structural deficit in next year’s budget. Last year, lawmakers gave the agency an additional $187 million to plug a projected $170 million budget hole.
But in the first five months of fiscal 2016, which began July 1, the T has outperformed its budget by about $53 million, mostly through reductions in operating expenses. Shortsleeve told reporters that the savings would be invested in capital needs for the aging system.
“We will invest every dollar we save, and every dollar that we beat the structural deficit, into capital,” said Shortsleeve, who declined to forecast how the roughly $50 million in savings through the first five months would impact the books by the end of the fiscal year. He said, “We are very aware that another big winter would negatively impact us.”
The $242 million projected fiscal 2017 deficit also included a fare hike of 5 percent while the T is looking at options to raise fares higher than that, contributing an additional $33.2 million to $49.4 million to the authority.
Separately, agency managers sketched out a schedule for redesigning and reassessing the Green Line Extension, culminating with a May 11 meeting of transportation officials.
Jack Wright, who worked on the Big Dig, will take over as interim project manager as the T uses a search firm to find a permanent hire, MBTA General Manager Frank DePaola told the T’s Fiscal and Management Control Board on Monday.
The Green Line Extension, a proposed trolley track and seven new stations bringing service through Somerville and out to Medford, faces uncertainty after cost estimates predicted it could increase to as much as $1 billion over the prior $2 billion price tag.
The T and the Massachusetts Department of Transportation will meet May 11 to discuss a scaled-down version of the project with a new price tag, DePaola said.
DePaola said Wright had worked for several years on the Central Artery Project, which is known colloquially as the Big Dig.
“I have all the faith in the world that Jack can deliver this program for us,” DePaola said. Saying Wright is someone with experience in budgeting and design, DePaola said, “We needed someone who had that requisite experience, who could start essentially today.”