Sep 11, 2008 11:01 pm US/Eastern
MBTA Is Broke; Borrowing Money For Salaries
BOSTON (WBZ) ―
MBTA executives admitted Thursday the transit system is broke – even as record numbers of people are riding the trains and buses.
The situation is so dire that the T is borrowing money to pay salaries. And the crisis could mean higher fares and reduced service.
At a chaotic monthly meeting of the MBTA Board of Directors, board member Janice Loux launched a blistering attack on T General Manager Daniel Grabauskas.
"Be truthful," Loux demanded. "You were not truthful about the raises. You are not truthful about this. You do not have any credibility left, Mr. General Manager."
The verbal assault came as the state's top transportation executives admit that the massive transportation agency, with a $1.5 billion budget, is out of cash.
"I don't have to go off the cliff to know I am heading for the cliff," Grabauskas told WBZ. "And today we are closer than we ever have been."
The bad financial news comes as the T is setting record after record for ridership. People sick of high gas prices are flocking to T buses, subways and commuter rail.
Fare revenues have jumped $11 million, but it's not enough. Board members were told the authority needs to borrow $35 million just to keep operating.
"The MBTA has the largest debt of any transit agency in the United States of America, and that problem is likely to get worse," said state Transportation Secretary Bernard Cohen, chairman of the MBTA board.
Board members were told significant service cuts may be needed to reduce the huge debt load.
And there is talk of fare increase in 2010.
Loux, recently reappointed to a new term by Gov. Deval Patrick, unleashed a blistering attack on Grabauskas.
"Mismanaged. Not telling the truth. It's a problem," she charged.
Grabauskas, appointed by former Gov. Mitt Romney, ignored most of the attacks but admitted the situation is dire.
"We are borrowing money to pay salaries right now, and that is always a bad idea," he told us.
Grabauskas later told WBZ that Loux is so angry with him because he refused to hire one of her relatives.
MBTA riders probably will notice very little difference in the short term. But T executives are paying bills with a credit card, and you cannot do that for very long.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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