YOU MAY REMEMBER that earlier this year I wrote a series of articles focused on how to fund our state’s transportation needs. You can read them here, here, and here.
My thoughts and advice in those articles may be worth re-reading as the year slowly begins to wind down, and we approach the release of reports from the governor’s Transportation Revenue Task Force and the advocacy coalition Transit Is Essential. These reports will presumably provide the platform on which we will build a discussion and ultimately, make decisions, regarding how to fund the state’s transportation systems.
The impending conversation about transportation revenue is unavoidable and essential to our future. Massachusetts faces two transportation revenue crises. We face a short-term urgent revenue crisis as the MBTA faces a massive shortfall in its operating budget, the so-called “transit fiscal cliff.”
The T is not alone in this. Most US transit agencies are facing similar circumstances, as fare revenues have not fully recovered and costs have increased as a result of the pandemic. We also face a longer-term crisis as the gas tax will increasingly be unable to support our transport funding needs as more people purchase hybrid-electric and all electric vehicles. It’s the short-term crisis, which hits next year, that I want to address here.
While ridership declines and reduced fare revenues are a national problem, the MBTA is significantly behind most other US agencies, not as a result of pandemic effects but as a consequence of what I would call shutdown effects. The approach taken by the T to respond to inflexible FTA safety requirements and eliminate slow zones – shutting down large segments of the subway system for long periods of time – has indeed effectively reduced slow zones, but it has also suppressed ridership. Whether those riders will return, and when they will return, remain open questions.
In the meantime, one reality must be faced by the governor and the Legislature: fares will no longer be able to sustain a third of the T’s operating budget. The bottom line is a significant fiscal crisis that the T cannot solve on its own without raising fares or cutting service – each of which will further suppress ridership, sending the system into a death spiral.
There’s a lot of speculation about the report that will emanate from the governor’s task force. Will it be simply a tool kit listing options or a set of specific recommendations? Will it propose specific solutions for the transit fiscal cliff, or simply treat the larger transportation revenue issues in a more comprehensive way?
Here’s what I can tell you for sure: there won’t be anything coming out of the task force that hasn’t been discussed by me and others over the years. There’s no magic solution, no new or novel funding approach that has never been tried and tested. We know the options (see my articles embedded above). We know how they perform. What we do not know is whether there will be sufficient leadership at all levels of the State House to develop a strong consensus about how to best move forward.
I offer the following framework, which I believe can be the foundation for the development of political and public consensus. Massachusetts’ transportation revenue system should raise net new revenue that is stable over the long-term and ample to meet our needs – not just our status quo transportation needs but our needs looking out into the next quarter of this century and beyond.
That stable and ample revenue must be structured from sources that respond to our values. That means a transportation revenue system that is regionally fair, socially just, economically smart, and environmentally sound. If we can craft a revenue system around these principles, we would be doing something of generational significance.
A few points I’d like to underscore:
First, political leaders need help with their messaging. We can learn from the abysmal messaging embraced by New York Governor Kathy Hochul regarding that state’s proposed congestion pricing plan. Contrary to the New York governor’s assertions, road pricing is not bad for drivers. It is a much better deal than the gas tax, and since we need to be thinking of replacing the gas tax, we should provide people with the facts demonstrating why road pricing is so much better. It is a much more agile tool that can be changed dynamically and adjusted to ensure both social justice and regional fairness. The gas tax can’t do any of that.
Second, the MBTA should receive a significant share of any future road pricing revenues, as a stable long-term solution to solving the T’s operating shortfall and properly funding the system. But because any road pricing initiative will take a while to put into place, the T needs a revenue bridge – a transition plan – to manage over the next several years. That revenue bridge could be a larger share of Fair Share (millionaire’s tax) revenues during the transition to road pricing, or it could be a combination of high-impact initiatives like higher fees on ride hailing, a new fee on home deliveries, a metro Boston payroll tax, or a sales tax on gas tax purchases.
Third, municipalities are increasingly stepping up to do more, including building dedicated bus lanes to improve T bus service and dedicated lanes to protect cyclists, as well as a variety of other Complete Streets initiatives.
Cities and towns are doing this on their own dime, within the constraints of their limited ability to raise revenues. Passing into law a regional ballot initiative, giving groups of towns the power to raise revenues for transportation, ought to be a priority for this administration and this Legislature. Regional ballot initiatives will enable municipalities to do more, possibly much more, by way of urban public realm and transit connectivity and access initiatives. Empowering municipalities to enter into regional ballot initiatives and make local assessments will take pressure off the Legislature and provide important new revenue sources at the local level. Regional ballot legislation can be written in a way that embeds some basic fairness principles for cities and towns that may not feasibly be able to benefit in the way most metro Boston communities will.
Fourth, the Legislature needs to begin sharing or fully absorbing existing transit cost burdens like paratransit and bond financing. The MBTA (and every regional transit authority) bears the full cost burden of providing paratransit services, even though paratransit is essentially a human services initiative that could (and should) more appropriately be paid by the Commonwealth.
The same is true of bond financing. All taxpayers benefit from the T’s ability to provide important sustainable mobility services. The bond financing that enables key capital projects should be a burden that the Commonwealth absorbs as a legitimate cost reflecting the need to respond to the effects of climate change and social equity throughout metro Boston.
Fifth, the transportation revenue conversation has to be grounded in our shared values. The focus needs to shift from cost to benefits. A lesson I’ve learned from my years in and out of government is that an obsessive focus on cost often comes at the expense of explaining to the public the benefits of transportation investments.
This is particularly true of public transportation. Connecting the revenue conversation to our shared values and the ability to fulfill those values is critical to making the case for new transportation revenue and revenue sources. None of what we say we want to do as a state and region – reduce harmful emissions, reduce time-robbing traffic congestion, improve regional fairness and social justice, and build a stronger, more inclusive economy – none of that is possible without a stronger, more robust public transportation system.
Ultimately, Massachusetts’ political leaders need to do two things next year: stop the T from falling off the coming fiscal cliff, and then build a financial bridge enabling the T to reach across the chasm to the other side, which is the future. That means not simply solving the fiscal cliff crisis but making essential and strategic investments in a better transit system.
We can no longer play the kick-the-can game, nor can we settle for simply returning to levels of funding that are never stable over time, and wholly inadequate to meet current and future needs. The transit funding approach we have been using throughout this century has failed. We need to recognize that and change it, and we need to hold our elected leaders to account if in this time of critical need, at this crucial inflection point, they fail to rise to the occasion.
James Aloisi is a former Massachusetts secretary of transportation and serves on the board of TransitMatters.
