Cross-post: This appears at Marry in Massachusetts.
Here we are worse. The semi-autonomous authority has backed itself into a cave with no way out. Its mythic justification for existence is providing revenue for road maintenance and building. Instead, it loses increasing amounts, piles on debt, and in fact exists as a small industry whose only purpose is to employee toll takers and managers.
While numbers have gotten even grimmer since, the last full report on MTA finances was through 2006. It shows static revenue — up a percent or two one year and down another by the same amount. Operating expenses are soaring. Operating income is plunging. Asset value is dropping steadily and steeply.
Perhaps even more meaningful to drivers and taxpayers is where income goes. For example, in 2006, out of gross revenue of $305 million, just over $20 million went to repair and reconstruction (the alleged justification for the authority and tolls). In the same year, $23 million went to general and administrative costs; fringe benefits and retirement expenses brought that to over $50 million. Moreover, operations and public protection costs were $132 million.
There is no other way to look at the net. The MTA is a good-sized business that exists to employee toll workers, their managers and board members. As such, it deserves consideration as any corporation. However, from a financial analysis, it is not viable.
I suggest digging into pages six through nine and 13 and 14 to see where the money comes from, where it goes and how little benefits us.
Back in the real world, a quasi-independent Turnpike Task Force completed its examination two years ago next month. The two major recommendations were:
- stop operating the Western Turnpike (west of the 128 toll plaza) as a tollroad by June 30, 2007
- in collaboration with the incoming Governor and legislature, enact legislation to end all MHS tolls (east of the 128 toll plaza), except on the airport tunnels, by December 31, 2007
Those may happen, although both Gov. Deval Patrick and the General Court leadership are avoiding the implications and thus acting sluggishly. As usual, it comes back and down to taxes again.
Apparently the partially hidden taxes are okay. We can play at fiscal conservatism and call them something else. Drivers pay gas taxes. They pay tolls. They support the dreadfully wasteful MTA structure and operations that do not provide the money to keep up the roads and bridges.
Consider instead if we eliminated tolls except for those few tunnels. The task force figures its recommendations would save between $69 million and $105 million annually. They would also shift “the burden on on-going MTA deficits, I-90 maintenance, and (Central Artery) financing from toll payers to all tax payers.”
We have been kept awake even in the day from the keening on this. Western drivers whine that they subsidize Eastern ones. Pike users in general carp about tolls and say they are paying for the free roads' maintenance too. Yet, these are the same folk who don't want any tax money going to mass transit, which they don't use.
We who live and work in the Boston area or other place where we bike or use the T instead of cars can be as self-interested about taxers to subsidize driving commuters.
We have had a long history of pseudo-free-market payment here. The theory is that those who use the roads should pay for them, and no one else. When the see how it grew into what it is, it's pretty clear that the Turnpike Task Force is right. Its lead reasoning is:
Over many decades, the MTA has evolved from a 1950-style independent authority with a simple, time bound mission into a rule-encrusted institution unable to reduce its own operating costs, integrate with the rest of state transportation infrastructure, or purge long-standing unfairness and adverse impact issues. There is no incremental fix that can effectively alleviate this condition other than the elimination of the founding concepts of toll collection and “independent” operations.
The fact is that the taxpayers are already paying more for the existing structure. We have long kidded ourselves that the tolls do anything other than pay the MTA salaries and benefits. The tiny road revenue does not begin to justify the authority.
We're far better off paying our bills like adults, in this case, maintaining the commonwealth's roads.
and you’ve got yourself a deal.
I’ve been for that for years, posting here and at MinM. I got Mike Dukakis to say it was a good idea, but not so sudden. He proposed a $1 fare.
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p>Tim Murray campaigned on more frequent, more widespread mass transit — plus trains from where people live to where they work on schedules that are too good to bother with the car.
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p>Those seem extreme to many, but I think that’s where we need to head if we want to stop the congestion/pollution/cost mess.
I agree that it’s unfair that some highways have tolls and others don’t. My proposal: add tolls to the highways that don’t have ’em, particularly since NHites can fill up in NH and drive to work in Boston and back every day and never pay a penny for the roads.
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p>Cut overhead operating costs? Absolutely. Let’s do it. The MTA shouldn’t be a parachute for pols and their friends, nor should any government agency, quasi/indie or otherwise.
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p>Looking at the pie chart, we’ve got:
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p>—
General and admin: 8%
Fringe benefits: 6%
Retirement: 4%
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Repair and reconstruction: 7%
Depreciation: 28%
Operations and public protection: 47%
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p>The “overhead” is 18%. Maintaining the infrastructure itself and physically charging the tolls is 82% of the cost. Is 18% too high? I have no idea; I suspect it could be trimmed a point or three.
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p>Of the 47% Op and public protect, what’s the breakdown?
* toll takers
* speed patrol
* plowing?
* other?
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p>It’s really hard to have a good conversation without understanding how the 47% breaks down.
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p>Interestingly to me, court fines only represent 2% of revenue. I wonder: of the 47% operations, how much is to operate the troopers? More or less than 2%? I suspect more than 2%… which implies that they might do well to figure out how to increase the revenues from court fines, either by raising the cost of the ticket or figuring out how to issue more of them per hour of trooper time.
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p>On a side note, I’m still holding out for a future which uses the highways as congestion pricing for Boston or Boston/metro. The details are complex to be sure — it’s not as easy as Manhattan in geographic terms. Still, food for thought.
…18% as an overhead rate is actually very good. Of course there are ways to make the number look better than it actually is. For example, they could be just reporting ‘overall’ overhead while the overhead of individual projects are encompassed with the reported numbers of the projects themselves.
You can eliminate the tolls and replace the revenue with an increase in the gas tax, and save money, net. It costs government nothing to increase the gas tax, and there are no toll booths to maintain and no collectors to pay. A study performed during the Romney administration disclosed that a percentage of toll receipts are lost to “shrinkage” (i.e. theft). You can eliminate that, too. Collecting the money on a “retail” car by car basis is an unnecessary expense.
The Turnpike is arguably the aorta of the Mass Highway circulatory system. Whether or not you drive on it, or even are a driver at all, you benefit from the goods and services that flow over it. Therefore, all citizens should pay for it, equitably. There is no decent reason to start putting tolls on other MA highways, and it follows that the only reason to leave tolls on the Turnpike is to maintain the status quo and keep the organization employed. Dump the Turnpike Authority, firing every last member of the organization from the Director down to the toll collectors. Take the maintenance assets and distribute them throughout the Mass Highway system by region. Take the maintenance employees and do the same. Take the road and distribute responsibility for it by region. Then develop a plan to pay for it the same as for any other road in the sate, and assuming everyone benefits from the infrastructure, everyone should pay for it, plus monies received from the gasoline tax.
The Turnpike is arguably the aorta of the Mass Highway circulatory system. Whether or not you drive on it, or even are a driver at all, you benefit from the goods and services that flow over it. Therefore, all citizens should pay for it, equitably. There is no decent reason to start putting tolls on other MA highways, and it follows that the only reason to leave tolls on the Turnpike is to maintain the status quo and keep the organization employed. Dump the Turnpike Authority, firing every last member of the organization from the Director down to the toll collectors. Take the maintenance assets and distribute them throughout the Mass Highway system by region. Take the maintenance employees and do the same. Take the road and distribute responsibility for it by region. Then develop a plan to pay for it the same as for any other road in the sate, and assuming everyone benefits from the infrastructure, everyone should pay for it, plus monies received from the gasoline tax.
in the prices of said goods?
Good point, but what is unique about that road that it should be tolled in perpetuity? Most of these roads, bridges and tunnels were built with the tale that once the bonds were paid off, the tolls would be eliminated. Of course, by that time, the organizations so loved their positions that new excuses were crafted to keep them in business. ‘We have to paint the bridge, it costs money…keep the toll’. ‘The tpke needs upkeep, …keep the tolls’. Well, you know Rt 24 needs upkeep, Rt 20 needs upkeep, and lets not forget Rt 128, it needs upkeep. They are all part of the transportation infrastructure of the state. They should be commonly managed, run, and maintained.
Just so, and in many states tolls came with new roads or new bridges with the idea they’d be in force until they paid for the construction. Sometimes that happened, but mostly the legislators got used to the idea, income, and of course, bigger payrolls to use and control.
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p>When collecting the tolls and operating the roads yields such low returns, it’s definitely time to do as you say. It would be much cheaper for the taxpayers to fork over for maintenance directly. Unfortunately, many in our legislature,particularly the House, seem terrified of raising taxes directly. They’d much rather citizens paid a lot more, so long as the costs are hidden. Harrumph.