MBTA lays off more employees to close budget gap

MBTA General Manager Michael H. Mulhern yesterday fired 33 managers and administrative staff members in yet another cost-cutting measure as the transit agency prepares for its third consecutive budget shortfall.

Facing a projected $10 million deficit in its 2005-06 operating budget that starts July 1, Mulhern also plans to ask the MBTA Board of Directors next week to dip into the authority's emergency budget for the first time in six years. And he plans to ask the board to sign off on ending Nite Owl weekend bus service and its subsidies to private suburban bus lines.

This year, Mulhern has already cut about 100 jobs from the T's 6,000-employee payroll. Many of those fired had been away from their jobs for a year or had exhausted their sick time. Those cuts helped the T mend a $16 million deficit in the current fiscal year. Mulhern also plans to trim about 100 employees from the Green Line by running trolleys with a single driver.

But faced with another shortfall, Mulhern said yesterday's firings, which will save $250,000 in the 2004-05 budget and some $2.5 million next fiscal year, were necessary. It is the largest administrative layoff since 35 were dismissed in November 2002.

Those asked to leave yesterday -- about 5 percent of the T's administrative staff -- ranged from staff assistants to Assistant General Manager for Environmental Affairs Geraldine Scoll, whose duties Mulhern said would now be merged with the T's Office of the General Counsel.

''I had to make some tough decisions at the top," Mulhern said.

Glen Tepke, senior policy associate for the Massachusetts Taxpayers Association, said that while the firings fall in line with recommendations made by a blue-ribbon panel, they could have been made years before.

''They've backslid a little bit and have added some staff in the last couple of years," he said. ''Clearly if they had continued on their course of reducing staff, much of that through attrition, that would have put them in a better position and they may not have had to face the current deficit."

Mulhern said the dismissals were another way for the T to maintain its operations without raising fares again. In 2003, the MBTA increased fares by 25 cents on subways, 15 cents on buses, and by varying amounts for commuter rail. Critics said the increase hurt minority residents who are heavily dependent on the transit system.

Mulhern is also proposing another alternative to raising fares: using up to $10 million, or 25 percent, of the authority's reserves. He said he hopes to need only $5 million, and has discussed the move with Wall Street analysts to make sure it won't increase borrowing costs.

Tepke said using the reserve funds makes sense if the T takes extra steps to boost ridership and revenue in the coming fiscal year. ''The problem you have is that the money is not there the next year," he said.

Mulhern blames the projected shortfall on rising healthcare and fuel costs, a $6 million drop in ad revenue, a past promise to give unionized workers a 4 percent pay increase, the continuing decline of ridership, and the growing gap between what the T says it needs in state sales tax revenue and what it is getting.

T officials say the budget outlook will improve as the MBTA begins to install its new automated fare-collection system on subways. The cashless system, which begins on the Blue Line in late April, is expected to boost revenue while also allowing the T to cut more employees.

Jonathan Davis, the T's chief financial officer, said the agency expects to collect nearly $6 million more by installing new turnstiles that will stop riders from not paying. The T expects to save another $4 million through staff cuts and attrition allowed by the new collection system. By fiscal year 2006-07, Davis predicted, the new fare cards should help the T to avoid a budget deficit.

Mac Daniel can be reached at mdaniel@globe.com