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MBTA rail line signal dating back to 1915. Investments in upgrading aging technology will be aided by savings in the T’s operating budget.

MBTA rail line signal dating back to 1915. Investments in upgrading aging technology will be aided by savings in the T’s operating budget.

The MBTA expects to cut its projected fiscal 2017 operating deficit by 43 percent, the direct result of continued reductions in overtime spending and other costs, and increases in revenue such as real estate and advertising. T officials will detail the authority’s improving fiscal status during a meeting of its Fiscal Management and Control Board.

The T previously announced it would be $75 million under budget by the close of the 2016 fiscal year. The operating budget recast for FY17 projects a deficit of $138 million, which is 43 percent lower than the $242 million originally forecast. That amounts to $104 million in savings.

The revised estimate can be attributed to approximately 75 percent in lowered expenses and 25 percent in improved revenues.

“We’re getting our cost growth under control,” said MBTA Chief Administrator Brian Shortsleeve.

Savings in operating expenses will be used to pay for much-needed infrastructure improvements:

  • $26.5 million for more Winter Resiliency Work
  • New third rail for the Red Line
  • New heaters for the switches and third rail on the Orange Line
  • $3.5 million for track upgrades along the Worcester/Framingham Commuter Rail Line
  • $70 million for major signal improvements on the Green, Red and Orange Lines

Such upgrading of aging and outdated infrastructure is critical. Some switches on the Green Line, for example, date back to 1915. Up to 30 percent of subway service delays are directly related to problems with aging signal systems.

“Every dollar that we can free up in operating expense is invested back into the system, helping us improve the level of service reliability,” said MBTA General Manager Frank DePaola.

DePaola said the $26 million Winter Resiliency II project will finish work that began prior to this winter season.

Built into the FY17 budget projections are significant new expenses caused by shifting 550 employees from The T’s debt-funded capital budget to the operating budget ($52 million), and scheduled union wage increases for employees ($12.5 million), as well as higher debt service payments ($13 million), pension and other non-wage operating expenses.

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