BOSTON — The MBTA faces an additional financial hurdle this year as projected sales tax revenue for the transit agency has dropped about $32 million, increasing the urgency to find new cost savings.
Layoffs have not been ruled out.
"As we seek to close what's a $100-plus million deficit this year, everything's on the table. Seventy five percent of our costs are wages and benefits so that's a core area of focus for us," MBTA Chief Administrator Brian Shortsleeve told reporters on Monday.
When the T passed its budget in April ahead of the July start to fiscal 2017, officials expected that higher sales tax revenues — a portion of which are dedicated to the T by statute — would help close a roughly $80 million budget deficit and wean the agency off regular bailouts in the state budget.
Sales tax projections have since taken a dip, widening the T's budget gap and highlighting the "exposure we have to the sales tax," Shortsleeve told the T's Fiscal and Management Control Board on Monday.
If projections hold up, fiscal 2017 will still achieve a historic amount of sales tax revenue to help finance the authority's roughly $2 billion budget.
The transportation authority employs about 6,500 people, and Shortsleeve said recent and future headcount reductions aim to achieve about $37.5 million in savings of unpaid wages and benefits. The target staff reduction is 300, according to Shortsleeve, who said the agency is bringing on new bus drivers as it seeks to reduce its administrative staff.
"Everything's on the table. We're going department by department, particularly in the corporate departments, identifying areas where we can streamline, we can run more efficiently," Shortsleeve said.
The T is also looking to outsource cash-handling, fare-machine maintenance and warehouse operations, among other work not central to the core mission of moving people around eastern Massachusetts.
A voluntary retirement incentive program that ended in June yielded about a 260-person reduction in staff, and the T hired, or "backfilled," about 110 of those positions, Shortsleeve said.
The T has added positions, such as chief technology officer, while also consolidating administrative functions between the MBTA and the Massachusetts Department of Transportation, which handles state highways and the Registry of Motor Vehicles.
A presentation by MassDOT Assistant Secretary of Human Resources Jessie Saintcyr said the speed of hiring has accelerated with more than 490 people hired so far in 2016 after 767 were brought on in 2015.