THE MBTA extended the contract of its existing commuter rail operator for a year to give the transit authority enough time to come up with a new contracting arrangement that would provide private sector funding to help electricify and boost service on the system.
Keolis Commuter Services was originally hired in 2014 and is currently operating under a four-year extension that ends on June 30, 2026. The latest extension, which would run through the end of June 2027, would give Keolis an extra $5 million a year over the next three years on top of the roughly $365 million annual fee the company already collects. The annual fee rises rises 2.5 percent a year, topping out at $407 million in fiscal year 2027.
Michael Muller, the T’s executive director of commuter rail, said the extension is needed to give the T more time to decide what kind of operator it wants going forward. Keolis operates the commuter rail system on behalf of the MBTA. The T is looking at entering into a partnership with an operator who would also invest in the system.
“The current contract model that we’ve always had is not designed to accommodate that kind of significant capital investment in partnership with the operator,” Muller said.
The T asked for input from potential contractors and 20 of them responded this month. Muller said the T is reviewing those responses and also working with consultants to come up with a procurement model. He said the T in the past has negotiated eight-year contracts with extension options, but may want to go with a contract of 15 to 20 years with the next procurement. He said it’s also possible the next procurement could be split, with one contract for an operator and another for a company assisting with capital delivery.
Muller did not go into specifics about how a company investing in the commuter rail system would be compensated.
He said the goal is to electrify more and more of the system and increase service, an ambitious goal that officials at the MBTA have been talking about for years.
The current timetable calls for developing a short list of potential bidders by the end of this year, issue a request for proposals in the fall of 2025, and select a winning bidder in the fall of 2026. The system would transition to the new operator in 2027.
The MBTA board of directors approved the Keolis extension after Quincy Mayor Thomas Koch, a member of thebo ard, asked Muller whether the additional money the T is providing to Keolis will improve wages and benefits for conductors who have frequently complained about their situation at board meetings. Muller didn’t go into specifics but said the extra $5 million a year would help address that situation.