A brand new report by a Boston-based suppose tank has discovered that the MBTA’s fare-collection overhaul undertaking is $211 million over finances and now approaches $1B price whereas working three years not on time.
“One takeaway that we have is that this mega project approaching $1 billion went off the rails originally, and the new MBTA (general) manager, Steve Poftak, basically took extreme steps to correct the problems,” mentioned Greg Sullivan, co-author of the report launched by Pioneer Institute on Thursday.
“We’re concluding that this project is back on track and it’s being successfully implemented day by day.”
The report examines the difficulties the company encountered with its preliminary $723 million contract for the undertaking, which seeks to modernize the T’s fare-collection system.
MBTA spokesperson Joe Pesaturo mentioned T riders “will benefit greatly from the new tap-and-go system, which will allow them to pay fares by using phones, contactless credit cards, or the new CharlieCards on all subway lines and bus routes.”
In February 2019, the MBTA despatched a breach-of-contract letter to Boston AFC 2.0 OpCo LLC, the company tasked with finishing and working the system, however rescinded it just a few months later and as a substitute opted to renegotiate the March 2018 deal, the report discovered.
Jim Stergios, govt director of the Pioneer Institute, mentioned this put taxpayers “on the hook for an additional $211 million.”
The new contract, signed in June 2020, elevated its price from $723 million to $934 million, and delayed full implementation by three years — from May 2021 to May 2024.
“The original contract, in hindsight, was a catastrophe because it was completely unrealistic to expect this system to be designed and operated in less than two years,” mentioned Sullivan.
The new contract requires a phased strategy to implementation, slightly than launching the brand new system throughout all stations at one time. The T mentioned it decided the preliminary strategy — which resulted in a compressed timeline for testing, set up, and buyer transition — was not possible.
The revised deal additionally “includes a robust risk allocation with substantial financial consequences and incentives around timeliness and delivery,” Pesaturo mentioned.
“That agreement is the result of negotiations which addressed both the risks the MBTA faced in the original agreement, and the underlying concerns the MBTA had at the time about OpCo’s performance,” mentioned Pesaturo. “If OpCo does prove to be delayed in completing the project, the price of the project will be reduced by every day of such a delay.”
Source: www.bostonherald.com”