Delayed again: Nearly $1B fare system to be no-show in 2024
Already 3 years behind schedule, $212M over budget
The MBTA does not expect to fully implement its nearly $1 billion automated fare collection system in 2024, as previously planned, effectively pushing back a project that was already three years behind schedule.
This project, when completed, will replace the 2006 CharlieCard system with a modernized contactless payment approach, allowing riders to tap or board at any door with a fare card, smartphone or credit card, with an additional aim of cutting down on fare evasion.
To that end, electronic fare gates were introduced at North Station in October, and will eventually be installed at South and Back Bay stations.
“The Healey-Driscoll administration has undergone a preliminary review of this complex project to assess its current status and timeline for completion,” MBTA spokesperson Joe Pesaturo told the Herald on Saturday.
“Based on the review so far, it’s clear based on the contractor’s most recent schedule, it is unlikely to meet the current 2024 timeline for full implementation. As the review process advances, more information will become available.”
It’s the latest setback for the T’s fare collection overhaul project, which is being implemented by Boston AFC 2.0 OpCo LLC, a subsidiary of Cubic Transportation Systems, per a 2018 contractual agreement.
The original contract called for full implementation by 2021, at a $723.3 million cost to the MBTA, but the T’s Fiscal and Management Control Board amended the deal in April 2020, pushing that timeline to 2024 and driving up the final price tag to $935.4 million.
Pesaturo did not address a Herald inquiry about whether the extended timeline would increase the cost of the project, but a source with experience in the fare payment industry said a price increase is likely.
“It came out that it was $200 million over budget, for a total cost of just under a billion,” the source said. “And that’s the last update we’ve had. I think we can all expect that there’s going to be future cost overruns that are going to get this project over a billion dollars.”
Brian Kane, executive director of the MBTA Advisory Board, said the board has been asking for a project update as part of its capital budget oversight process for the past couple of years, but has not been getting much of a response from the T.
“It looks like they’re trying to do this incrementally and not make a big deal about it, and have this be a whole big, giant program or project that’s subject to systemic failure issues,” Kane said. “I think they’re going to incrementally phase in stuff over the next three, four or five years.
“And by 2026, ‘27, ‘28, you will see a wholly transformed fare collection system out there. But you won’t have a giant ribbon cutting.”
Stacy Thompson, executive director of LivableStreets, said the contract is overly bloated and complex, making the project’s “endgame” more difficult to accomplish. The MBTA should have focused on its fare policies first, she said, before implementing new fare payment technology.
“The MBTA must start putting policy before technology because at the end of the day, we have a fare collection system that is offtrack, is costing us a billion dollars, and we don’t have low-income fares,” Thompson
said.
“We haven’t figured out our fare policies in a postCOVID world. None of that work has happened. Technology will not save us.”
Pesaturo said the MBTA continues to review fare policy, “through the lens of equity, to deliver a project which modernizes the fare system to reflect customer payment choices, such as mobile devices and contactless credit cards.”
Charlie Chieppo, a transportation watcher at Pioneer Institute, said a big part of the problem is with the vendor, which has control of a large share of the
market, in terms of transit agencies seeking to implement this technology.
In May 2022, Pioneer Institute published a report on the project, which cited a 2017 Governing Magazine article that described problems and delays that had occurred in other transit agencies that had contracted with Cubic for similar technology, including Chicago, Philadelphia and Washington, D.C.
“If you want this kind of fare system, you don’t have a lot of other places to go,” Chieppo said. “So I think they’ve done a lot of overpromising and under-delivering.”
However, an observer of the T’s project pointed out that in New York City, the much-larger Metropolitan Transportation Authority was able to get its contactless payment system up and running faster and at a lower cost than the MBTA.
“They’re up and running and going and the T’s system is nowhere to be found,” the source said. “So it’s not exactly a situation where the T can blame the vendor … because the vendor successfully rolled out a similar procurement at a much bigger agency in the same time frame.”