Lawmakers, union leaders want MBTA privatization reigned in

Source: Metro, October 3, 2017
The MBTA privatization debate may change course after lawmakers urged their colleagues Monday to start rolling back the privatization powers they granted the T after the disastrous 2015 winter.  After winter storms suspended the MBTA’s train service more than once, lawmakers gave Gov. Charlie Baker three years to fix the T without the constraints of the Taxpayer’s Protection Act, called the Pacheco law. That law requires private contractors to prove cost savings and no service reduction before any state service can be outsourced.  Since the law’s suspension, the MTA has outsourced cash handling and equipment management operations and is considering privatizing bus maintenance at three garages. …


Quincy officials to speak against privatization of Quincy T facility
Source: Sean Philip Cotter, The Patriot Ledger, September 22, 2017

As the prospect of privatizing services at the MBTA maintenance garage in Quincy approaches, two Quincy officials plan to speak in a state Senate hearing against the prospect. State Sen. John Keenan and state Rep. Tackey Chan will speak Oct. 4 before a hearing of the Senate Committee on Post Audit and Oversight, letting their concerns about privatizing the operations of Quincy’s and similar garages. The T’s request for proposals for contractors to take over up to three garage’s operations are due on Wednesday. If the T wishes, the contractors could begin operations around the start of the new year, according to the request for proposals the agency issued in July. …

MBTA union blasts Baker’s privatization plan
Source: Christian M. Wade, Gloucester Times, August 14, 2017
Union workers at the MBTA are pushing back against Gov. Charlie Baker’s plans to privatize bus maintenance, saying it will cost jobs and compromise safety.  Hundreds of workers rallied Thursday outside the MBTA’s Lynn garage, where they blasted Baker’s support for hiring private companies to take over bus maintenance.  “Gov. Baker has chosen to gamble with the taxpayers, the safety of riders and the livelihoods of these hardworking men and women,” said Michael Vartabedian, who heads the International Association of Machinists Local 264, a union representing 120 MBTA bus maintenance machinists. “We won’t let core public services like MBTA bus maintenance be dismantled and destroyed.” …

Senators, reps urge T: Negotiate with your workers instead of privatizing
Source: Nicole Dungca, Boston Globe, April 20, 2017

The state’s congressional delegation is urging the Massachusetts Bay Transportation Authority to negotiate with a machinists union in hopes of preventing dozens of jobs from being outsourced.  In an April 17 letter to Governor Charlie Baker and the state’s transportation secretary, Stephanie Pollack, the legislators called on the MBTA to negotiate with the International Association of Machinists Local 264 less than a week after the agency’s board approved a budget that could privatize dozens of jobs. …

State Inspector General looking into MBTA deals
Source: Matt Stout, Boston Herald, Thursday, April 13, 2017

The state’s independent Inspector General has launched a “proactive” review of at least one of the MBTA’s newly outsourced contracts, bringing the first outside scrutiny to the T’s privatization efforts since the lawmakers granted it a waiver from the Pacheco Law. Inspector General Glenn Cunha’s office said the “interim analysis” — which is not required by law — will be led by a unit specifically created in 2009 to monitor MassDOT, the MBTA and its various programs. Cunha’s office declined to say which contract it’s scrubbing, but it will focus on one of two: a five-year, $18.7 million contract with Brink’s Co., to take over the T’s so-called “money room”; or a five-year, $28 million contract with Mancon to run a parts warehouse.

MBTA officials hope to can save $26 million in bus maintenance costs
Source: Nicole Dungca, Boston Globe, March 6, 2017
Massachusetts Bay Transportation Authority officials said Monday they want to solicit bids to privatize several of their nine bus garages to save about $26 million annually, a prospect that prompted dozens of union supporters to pack the agency’s weekly board meeting.  The MBTA spent about $132 million on bus maintenance during the 2016 fiscal year, and officials estimated that outsourcing the work to private companies could save $26 million annually, officials said.   Brian Shortsleeve, the MBTA’s acting general manager, said the agency must be “ruthless” in becoming more efficient. He has previously pointed to the MBTA’s bus maintenance costs as much higher than those of similar agencies. … The MBTA didn’t release a timetable for the bid process, but it has suggested it would make the change before the next fiscal year. … Officials are focused on privatizing four dilapidated garages in the Boston area, which are staffed by about 120 workers. … Officials also hope outside companies will find ways to cut about $5 million in costs at the Everett bus garage, and about $6 million at the Cabot Garage in South Boston, which will soon be used only for new buses. Workers at Cabot have also been “challenged” to bring their costs down to private-sector levels, Shortsleeve said. … If approved, the outsourcing would mark one of the largest privatization efforts under Governor Charlie Baker’s administration, which had pushed for more flexibility in outsourcing public jobs. The MBTA is already privatizing its cash collection and warehousing departments. MBTA officials have said that the threat of privatization has spurred union officials to reduce worker costs. In December, the MBTA’s largest labor group, the Boston’s Carmen’s Union, agreed to give up a bargained raise and cut wages for future workers to protect thousands of jobs from being outsourced. …

Baker taking pass on Pacheco Law
Source: Bruce Mohl, Commonwealth Magazine, March 6, 2017
THE BAKER ADMINISTRATION is showing no signs it will push the Legislature for an extension of the MBTA’s three-year exemption from the Pacheco Law, which regulates how state agencies can privatize services. “At this time we are not planning to seek any changes in that,” said Stephanie Pollack, Baker’s secretary of transportation. “We have not had any conversations about that at this time.” …

MBTA’s latest outsource plan could save $65M
Source:Matt Stout, Boston Herald, February 13, 2017

Hundreds of MBTA workers could be affected as T officials push the transit agency’s boldest outsourcing plan yet — privatizing maintenance on its sprawling bus fleet, a move consultants say could save up to $40 million a year. The third round of cost-cutting privatization, it would be the first to target the agency’s core operations. The recommendations, part of an internal report produced by T-hired consultants, also target the agency’s in-station customer service operations as an outsourcing “opportunity,” as well as additional maintenance of its new Red Line and Orange Line vehicles. MBTA officials are poised to take the recommendations to the T board as early as today, weather permitting. Taken together, the T could save $65 million a year, according to the report. Its recommendations could affect more than 600 workers, with some possibly moving into similar roles under a private contract, officials said, while others might get other jobs at the T, retire or face layoffs. The plan would mark the agency’s boldest foray into the private market since lawmakers gave it a three-year reprieve from the so-called Pacheco Law. …

T considering privatizing bus maintenance
Source: Nicole Dungca, Boston Globe, February 13, 2017
The MBTA is considering the privatization of its bus maintenance operations, a move that could affect up to 450 jobs at the agency and potentially save nearly $40 million a year, according to the agency’s general manager.  It would be one of the largest attempts at outsourcing by Governor Charlie Baker’s administration after the Legislature suspended a law for the MBTA that puts up hurdles to privatization. The agency could soon ask for requests for information from outside companies who want to bid on the maintenance services. …

The MBTA’s Struggling Warehouse Will Be Privatized
Source: Spencer Buell, Boston Magazine, January 10, 2017

It’ll be faster, cheaper, and more efficient, T officials say. And there won’t be any more waiting around more than two days for widgets. By privatizing its warehouse operations, they say, big changes are coming to the way the agency orders, locates, and transports spare parts for its aging fleet of trains and buses. The T’s fiscal and management control board on Monday voted in favor a plan to hand over its parts-finding-and-transporting needs to a private company, Mancon Inc., for $28.4 million for a five-year contract. According to a presentation at the meeting, the move will save $25.4 million in operational costs and $38.8 million in capital costs, the State House News Service reports. Officials say Mancon aims to reduce the amount of time it takes to locate and deliver a spare part from a current average of 68 hours to 10 hours. Mancon will also seek to make its record-keeping more efficient: T records on inventory are accurate about 61 percent of the time, and Mancon plans to get that figure up to above 90 percent. They will also staff the warehouse 24 hours a day, seven days a week (warehouse employees currently work eight-hour days). … This is the latest shift from union employees to a private company to come since the Legislature passed a three-year waiver of the Pacheco Law, which slowed down efforts to privatize government agencies by requiring that they be approved by the state auditor. So the Gov. Charlie Baker administration has been looking for opportunities to save money and to, as T leaders have argued, focus more energy and attention on getting people from A to B than on services they could pay someone else to worry about. …

Options to privatize MBTA service diminished under union deal
Source: Worcester Business Journal, December 20, 2016

The agreement struck between the MBTA and Carmen’s Union Local 589 on Monday ends the talk — or threat — of privatizing MBTA bus routes, but T officials said they do not intend to look past their ability to seek outsourcing options elsewhere. As part of the revised and extended contract, the possibility of the T outsourcing the work of driving buses or operating trains on its current system is eliminated, both sides said, but the T retains the right to pursue privatization in other parts of the transit system. … Under the pressure of a more than $100 million structural budget deficit and an aging system whose more than $7 billion repair backlog translates into delayed trains and frustrated commuters, T leadership has turned toward privatization with the governor’s and Legislature’s blessing. Already the T has privatized the operation of its money room to Brinks and is in the process of outsourcing work at its inventory warehouse. And the agency’s Fiscal and Management Control Board (FMCB) in a Sept. 1 report signaled it might seek outsourcing of “those areas that make up about 85 percent of all costs, namely operations and maintenance.” In 2015 as part of the annual budget bill, the Legislature enacted a provision first initiated by the House Committee on Ways and Means to give the MBTA a three-year suspension of the so-called Pacheco Law, which requires a privatization proposal to be vetted by the state auditor. That waiver from the Pacheco Law and the ability to outsource, Pollack said Monday, was “a critically important tool” in negotiating the new agreement with the Carmen’s Union. … Though the jobs of 3,614 T employees represented by the Carmen’s Union will be protected, Pollack said negotiations with the union included “a very detailed conversation about what is protected but also what remains available to the (FMCB) to continue the process of outsourcing where it makes financial sense.” Where outsourcing may make sense, Pollack said, is in the area of bus maintenance or any level of service above the 2.4 million revenue hours that are now guaranteed to the Carmen’s Union. Pollack and Shortsleeve said it was important to the T to protect only a total number of man hours rather than specific bus routes or subway line operations in order for the T to maintain flexibility in scheduling, or expanding, service. …

MBTA, Carmen’s union come to agreement; new contract will save T $81 million
Source: Matt Stout, Boston Herald, December 19, 2016

The MBTA and its largest union have hatched what officials called a “game-changing” labor agreement that will protect swaths of the core system and thousands of employees from being outsourced in exchange for workers forgoing millions of dollars in pay increases, among other concessions. The new $1.6 billion contract between the T and Carmen’s Union Local 589 was approved by the T’s Fiscal Management and Control Board today after a formal vote, a day after a majority of union members agreed to ratify it. The T says the deal, which will run through June 2021 and replaces the current contract that is set to expire in 2018, will save the cash-strapped agency nearly $81 million over the next four years, including $49 million in wages. More than 4,100 Carmen’s Union members won’t take a 2.5 percent pay increase that was scheduled for June and new workers will make anywhere from $4 to nearly $6 less per hour than they would have over the life of the contract.

Evans: Outsourcing at the MBTA
Source: Martin G. Evans, Metro West Daily News, December 10, 2016

Should we or shouldn’t we turn functions of the state’s largest transportation agency out of the hands of public employees and turn them over to private contractors? It all depends. One of the units that the MBTA is to privatize is the money-handling unit. The T has signed a five-year contract with Brinks to carry out this activity. At first blush, it would seem that this is a function ripe for outsourcing. It is not a core function of the T. It has quite low interdependence with other parts of the T. It is downstream from the important operations of the T. The cash being counted doesn’t immediately flow to other parts of the T to finance operations or pay debt; the T has ample buffer stocks of money (aka a credit line) to keep the operation going. … A second domain that, according to the T, is poised for privatizing is the warehouse. Privatizing the warehouse would be a major mistake. Two of the core departments are directly dependent on the warehouse. The parts stocked there go to the train and bus operations and, more significantly, to the maintenance department. With the warehouse as an integral part of the T, it has two major motives, first to have sufficient stock of myriads of parts so that the T does not shut down because a critical part is unavailable. It second motive is to minimize cost. Meeting these two goals requires a deep understanding of the demands made by the downstream departments and a nuanced playoff of the goals against each other. …