MBTA Review - November 1, 2009

Payroll & Fringe
Benefit Expenses
Actual vs. Finance Plan
FY01–FY08
Cumulative negative
$113 million
$ Millions
40
20
0
(20)
MBTA Expenses Actual v. Forward Funding Plan
2001-2008
(40)
(60)
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008
The MBTA currently employs 6,346 workers, of which roughly 600 are
in part-time jobs.
All but 263 of these workers are represented by one of 28 unions.
Total headcount at the MBTA is actually down by approximately
200 since the Forward Funding Plan began, while total payroll and
benefits costs have increased.
MBTA Hourly Wages
Comparison of Ten
Largest Transit Agencies
Transit System
Operator
Top Rate
San Francisco $29.19
New York City $26.92
Chicago $26.87
Boston $26.56
Washington $25.93
Seattle $25.34
New Jersey $24.27
Philadelphia $23.54
Los Angeles $21.27
Atlanta $19.25
(As of 1/2008)
• Total payroll and benefits costs increased from $412.8M to
$548.9M between FY01 and FY08 due to increases in wage, health
care and pension costs.
• This cumulatively exceeded Finance Plan projections by $113M.
• Between FY01 and FY08, the unionized workers received
average annual wage increases of 3.0%, while MBTA executives
received average annual increases of 1.9%.
• Non-union MBTA employees have not received wage increases
since 2005.
• Wage increases for union workers are comparable to the 3.5%
annual growth in the Consumer Price Index-Urban Boston and
Massachusetts median household income for the same time period.
• The MBTA’s wage rates and total wage costs are similar to those
of other top U.S. transit systems, as is shown in the table at left.
The Finance Plan inexplicably projected no increases in health care
costs between FY01 and FY08.
• In reality, employee and retiree health benefits costs increased
73%, growing from $60.6M in FY01 to $104.9M in FY08.
As mentioned previously, the Transportation Reform Legislation passed
in July 2009 has the potential at some point to help the MBTA lower
its health care and pension costs by switching MBTA employees and
retirees to coverage under the Group Insurance Commission (GIC),
although MBTA unions have filed a lawsuit that challenges the legality
of forcing benefit changes outside of the collective bargaining process.
MBTA Review | November 2009
p. 9