At the start of March, Fidelity Investments, one of the world’s largest financial firms, began allowing workers to return to its Boston headquarters. Many of these workers likely came to work on the city’s subway, as the South Station stop is just next door.
Despite this, Fidelity—like other Massachusetts corporations—pays relatively little to fund Boston’s transit system. In fact, back in the 1990s the firm successfully lobbied for a tax break called Single Sales Factor (SSF), a move which has cost the state more than $3 billion in the last ten years.
Such corporate tax cuts have left the Massachusetts Bay Transportation Authority (MBTA)—known as “the T”—heavily reliant on fare revenue from riders. During the pandemic, this has meant that low-income people and communities of color are paying a substantial share of this revenue.
That’s just one of the takeaways in a new report from Public Transit Public Good, a Massachusetts coalition of transit riders and workers.
Unlike other large transit systems, including New York, Miami, Los Angeles, and Seattle, the T has no reduced fare program for low-income adult riders. Fares have nearly tripled since 2000, rising faster than inflation.
Rather than reducing fares, Massachusetts’s leaders have chosen to continue to cut taxes on corporations and the wealthy. Currently, residents in the top 1 percent income bracket pay only 6.8 percent of their income in taxes, while those in the bottom 20 percent pay 10 percent.
Massachusetts’s leaders have even privatized the T’s fare collection system, outsourcing it to two private equity-owned, for-profit corporations. This commits hundreds of millions of state dollars to corporate profits, rather than reducing fares for riders.
The report is a wakeup call not only to leaders in Massachusetts but also those around the country. Fares for trains, buses, and other public transit are “perhaps the most regressive way to raise public funds.” They should be eliminated—or at least reduced for the low-income people who rely on public transit the most.
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Photo by nsub1.