THE MBTA IS FACING intense pressure to increase operations spending on safety and other initiatives, but some of the higher expenditures are being offset by an unexpected surge in sales tax revenues.
The growth in sales tax revenues is coming at a time when policymakers on Beacon Hill have been bickering about T funding. Lawmakers last week pared back a supplemental appropriation for the T from $50 million to $32 million; the Baker administration described the full $50 million as a high priority.
David Panagore, the T’s chief administrative officer, told the Fiscal and Management Control Board on Monday that it’s likely the T will have to take some of the money it had set aside for capital projects this year and use those funds to balance the operating budget. He is currently forecasting a fairly modest hit of just over $5 million because the T’s share of state sales tax revenues is growing so fast – up an estimated $51 million over the guaranteed base amount.
Those additional sales tax revenues are offsetting declines in parking revenue and rising costs for overtime, wages, fuel, paratransit services, and a series of new initiatives. The new initiatives include $11.2 million this year for safety efforts; $700,000 to begin planning a new, more subway-like commuter rail system; and $1.2 million for bus system improvements.
The T had been planning on using $37 million it had set aside from a $127 million legislative appropriation for capital projects to balance this year’s budget, but Panagore said he is currently estimating the T will need at least $42.2 million.
The need for more money is coming even as overall expenses at the T were $9.2 million below budgeted targets through the end of October and revenues were $11.3 million above targets. Commuter rail revenue is running $10 million ahead of forecasts while subway and bus revenue is running $4 million below forecasts.
Cost pressures are likely to keep increasing on the operating budget. The T is currently estimating its planned bus improvements will cost $25.7 million in fiscal 2021, while safety improvements will cost $21.2 million and the ongoing commuter rail makeover will add another $1.9 million.
There are still six months left in the current fiscal year.
