On Tuesday, a Boston Globe editorial called transportation finance “one of the more complex and thankless areas of state policy.” Perhaps that’s why Gov. Deval Patrick, Charlie Baker, Tim Cahill, and Jill Stein have tussled during the gubernatorial campaign over the Big Dig and South Coast Rail, but have had next to nothing to say about the looming financial problems ahead for the Bay State’s mass transit systems, roads, and bridges.
“Clearly, the focus on the Big Dig has ignored the enormous problems facing the MBTA and the transportation infrastructure in the state,” said Michael Widmer, president of the Massachusetts Taxpayers Foundation.
Stymied by the Legislature’s rejection of the gas tax, Patrick has no interest in going down that road again. After a recent appearance at a public forum in Lexington, Patrick told me that he had “no plans to propose a new gas tax” or other transportation-specific revenue proposals if he is re-elected. He then added that the state needed to “wait until the economy improves” before it could address the question of new revenues. As for funneling more money to the debt-saddled MBTA or other departments, Patrick said the “dedicated portion of the sales tax is it.” Even so, he is pushing ahead with transit expansion plans for which no financing is currently available.
Republican Baker and independent Cahill say transportation belt-tightening is needed rather than any new tax revenues. Both oppose transportation expansion projects like South Coast Rail, with Cahill going so far as to question the need for mass transit commitments made during construction of the Central Artery. Stein favors South Coast Rail and says she can free up money for transportation by cutting elsewhere in the state budget.
The next fiscal year promises to be rough. With stimulus money no longer available to plug budget holes and only about $550 million in the rainy day fund, the state is expected to face a $2 billion funding gap in fiscal 2012. The outlook for millions in new federal funds for transportation projects is unclear, since Congress has not passed a transportation reauthorization bill. Going into 2012, the MBTA alone faces a deficit of close to $100 million.
The Transportation Finance Commission warned three years ago that Massachusetts faces a transportation funding hole of nearly $20 billion just to maintain the present system over the next 20 years. On top of the maintenance backlog, cost estimates for expansion and enhancement projects like South Coast Rail are approaching the $2 billion mark. On Thursday, Sen. Robert Hedlund, a Weymouth Republican and a member of the Legislature’s transportation committee, called for an oversight hearing on South Coast Rail and the Greenbush line.
The state has also borrowed heavily for roads and bridges, including $3 billion in 2008 for the accelerated bridge repair program and another $1 billion this past June to pay MassDOT highway division and planning and programming employees for the next five years.
The Transportation Finance Commission identified roughly $2.5 billion in savings that could be squeezed out of the transportation bureaucracy, but also cautioned that “cost-saving measures alone cannot get us where we need to go.”
Yet none of the gubernatorial candidates are talking about anything other than cost-saving measures.
Throughout the campaign, Patrick has highlighted his transportation accomplishments, including the dismantling of the Massachusetts Turnpike Authority and the creation of the Massachusetts Department of Transportation. Health coverage for MBTA workers shifted to the General Insurance Commission, the state’s health insurance system, and so-called “23 and out” pensions, which allowed MBTA workers to retire after 23 years on the job with full benefits regardless of age, were eliminated.
According to the Patrick administration, MassDOT has saved more than $268.3 million since its establishment last November. The state will also recoup $30 million more in annual savings this fiscal year on health benefits alone.
But Sen. Richard Tisei, the Republican candidate for lieutenant governor, said in a telephone interview that the state still has work to do on reforming the transportation system. “I’m sure there are some people who are in favor of a gas tax increase, but there’s literally hundreds of millions of dollars in savings and efficiencies that are called for in the transportation reform bill that the governor hasn’t addressed at all,” he said. “You still have Pike toll takers making more than more than most teachers in the state do.”
Independent candidate Cahill also opposes new taxes or increasing tolls beyond what has to be raised to pay off Big Dig financing.
He believes that halting work on expansion or enhancement projects like South Coast Rail, Boston-Worcester commuter line upgrades, and a Hyde Park commuter rail station would free up more than $100 million.
The treasurer would only support the South Coast Rail link between Boston, Fall River, and New Bedford “if the federal government comes in and says they’ll pay 90 percent or 80 percent.”
He also proposed re-negotiating the Central Artery commitments, a series of projects improving public transit that the courts ordered as mitigation for the Big Dig, to “see if they still make sense given where we are today and given what our finances are.”
The state treasurer went on to question the Transportation Finance Commission’s arithmetic, saying that the group inflated the amount need to address the state’s maintenance backlog.
Reports like the commission’s “are often written by lobbyists…people who have a financial stake in the outcome,” Cahill said by phone recently. “My experience running the School Building Authority made me look with skepticism on the grand plan that we spend $20 billion to fix this and do that.”
Widmer, a member of the Transportation Finance Commission, disagreed. “Those of us who worked on the commission were steadfast in understating in making assumptions in order not to be criticized for overstating the gap.” he said. “No one who has read the report has found any fundamental flaws in the analysis.”
Stein, the Green Rainbow Party standard-bearer, supports rescinding tax breaks for certain industries as well as finding administrative savings in health care that could furnish up to $1 billion that she believes could be re-directed to other areas like transportation.
She views the gas tax and other revenue-raising ideas, such as a tax based on vehicle miles traveled, as regressive measures that burden low and middle income families disproportionately.
All four candidates oppose Question 3, which would roll back the sales tax from 6.25 percent to 3 percent. Under current law, the T receives 1 of every 6.25 cents raised by the sales tax. The sales tax also provides another $300 million for transportation, including $160 million extra for the T, $100 million for the Turnpike, $15 million for the regional transit authorities, and $21 million for MassDOT.
Should Question 3 pass, the T under current law would continue to collect 1 of every 3 cents raised by the sales tax, but all the other transportation funding would disappear.
“If Question 3 passes, and let’s hope it doesn’t, we will have to go back to the drawing board on a lot of stuff,” Stein said.
With a 3 percent sales tax, “everything goes up,” said Patrick, including MBTA fares and tolls.
