MA: Massachusetts millionaire’s tax supporting MBTA projects

The MBTA is dumping nearly a billion dollars in revenue from the Massachusetts millionaire’s tax on projects officials say are aimed at enhancing safety and reliability, while the agency transitions to an in-house bus maintenance program.

The network’s Board of Directors has approved using $850 million from the millionaire’s tax to fund four “major infrastructure projects,” including a battery-electric bus maintenance facility that will support up to 200 vehicles.

This is the second allocation that the T has used to bolster its infrastructure from what officials refer to as the Fair Share Amendment. The board approved a $200.8-million initial pool in January 2024 that addressed safety and hiring and retaining employees.

Bay State voters in November 2022 approved a 4% surtax on incomes above $1 million annually, with the revenue dedicated to improving education and transportation.

With the second batch generated from the tax in hand, the MBTA is set to complete power upgrades, track reconfigurations and signal system updates on the Green Line; procure new Commuter Rail locomotives; and work on the first phase of a Widett Regional Rail Layover Facility project

“The MBTA has been making significant progress to improve safety and reliability across the system, and this funding will help them continue this essential work,” Gov. Maura Healey said in a statement. “Together with the Legislature, we are making sure that the T has a balanced budget and the resources it needs to deliver the world-class service that the people of Massachusetts deserve.”

The MBTA is expecting to bring in massive savings, in the tens of millions, as the transit network moves to “in-house” bus repair services instead of contracting with a third-party to overhaul the vehicles.

A fleet of 175 buses that the agency purchased in 2016 and 2017 is due for what officials describe as a “mid-life overhaul,” and they’ve determined that the repair work can be completed within the agency rather than paying an outside vendor to do the job.

The move is expected to generate some $73 million in savings – the difference between the $116 million that it costs to outsource the work and the $43 million it would take for the MBTA workforce to get the job done.

MBTA General Manager Phil Eng is looking at the transition as a short- and long-term investment that he believes will improve bus maintenance and service, making the vehicles durable for longer stretches.

“The investment in transportation, the investment in our workforce,” Eng told the Board of Directors on Thursday, “we have an obligation to show that that investment is delivering for the public, not only with improved service, safe service, better service, but we can actually save taxpayer dollars, and that we can do quality work.”

Thursday’s meeting marked the first time Eng has addressed the board as the state’s transportation secretary. He is maintaining his GM role, but he has replaced Monica Tibbits-Nutt as the leader of MassDOT in the interim.

Tibbits-Nutt will stay on until the end of the year in an advisory capacity, on the taxpayer’s dime, as she is also keeping her $200,000 pay.

To support the in-house bus repairs, officials say the agency will be looking to a crew of machinists, sheet metal workers, painters and an engineer. The work will be implemented in three phases over four years at four buses per month.

“It’s a massive, massive savings,” Chief Operating Officer Ryan Coholan said. “And it goes beyond dollars, because when you talk about the quality of a program like this, the pride that a program like this can build in-house with our workforce. … I’m going to put the value even higher than the cost savings.”

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