T board advances budget with 7% spending increase

MBTA overseers took another step Thursday toward a budget that would rely on a major boost in state funding to drive a considerable increase in spending, much of it on hiring more than 1,000 additional positions.

The MBTA Board of Directors voted unanimously to advance a $3.24 billion draft budget for fiscal year 2026, embracing the proposal to ramp spending up by $222 million or 7% over the current plan despite a revenue shortfall.

MBTA staff envision continuing a hiring campaign, and the draft budget calls for increasing the agency's headcount to 8,030 employees in fiscal 2026 — nearly 15% higher than the active headcount in March.

The T's plan anticipates receiving hundreds of millions of dollars more in state aid compared to last year. Both Gov. Maura Healey and the House Ways and Means Committee have proposed sizable funding injections for the MBTA in their annual state budget drafts and in a separate bill spending excess surtax revenues. It's not clear if Senate Democrats will agree with those ideas.

A bigger share of state aid will not entirely close the gap. T budget-writers estimate the agency will need to save another $82 million through cost-cutting measures such as reducing overtime.

MBTA leaders have argued in recent months that many of their financial headaches are structural and deep-rooted, and transit agencies around the country are also struggling with reduced ridership in the wake of the COVID-19 pandemic.

The T's draft budget for fiscal 2026 projects nearly $450 million in fare revenue, about two-thirds as much as the agency relied upon before COVID-19.

"I don't know if we'll ever get back to the $700 million we were before the pandemic," MBTA Chief Financial Officer Mary Ann O'Hara said.

The draft budget will go to the MBTA Advisory Board, an independent organization that represents cities and towns that help fund the T, for review. After accounting for any feedback from the Advisory Board, the T's Board of Directors must approve a final spending plan by June 15.