Years of rampant overtime abuse and pension fraud at the Long Island Rail Road should have served as a “warning sign” for Gov. Maura Healey, when choosing its former president as the next MBTA general manager, one fiscal watchdog said.
Pointing to the soaring payroll costs that already plague the MBTA, MassFiscal spokesman Paul Craney said the public can expect more of the same, or perhaps worse, when Phillip Eng takes the reins of the region’s embattled transit agency on April 10.
“I think what’s interesting is that Gov. Maura Healey picked someone that comes from a railroad system that clearly has incredible problems with costs and efficiency, to the point that it is the poster child of an agency that’s doing it wrong,” Craney said.
“She didn’t pick someone that comes from a transit agency that is being innovative and efficient in how it’s spending its money.”
Craney was referencing past reporting from the New York Times, which first highlighted massive disability fraud at Long Island Rail Road in 2008. The paper found that virtually every career employee there was collecting disability payments after retiring early, at a rate three to four times that of the average railroad.
Six years later, the Times reported not much had changed. Roughly 96% of former LIRR employees were granted occupational disability payments upon applying for them, nearly the same approval rate as before.
Further, in February 2022, Thomas Caputo, the kingpin of an overtime abuse scheme involving four other people at LIRR, was sentenced to eight months in prison for falsely claiming 3,864 hours of overtime in 2018.
This amounted to $344,000 in additional compensation and made him the Metropolitan Transportation Authority’s highest-paid employee that year, according to a New York U.S. Attorney’s office.
The longstanding inefficiencies at the Long Island Rail Road also provided fodder for a book published in 2006, “The Gravy Train.”
Craney concedes that these problems can’t be pinned on Eng, who took over the Long Island Rail Road in 2018 and is credited with making significant strides in improving efficiencies there until his retirement last year, according to a press release from Healey’s office announcing his appointment.
But Craney insists that Eng, who worked as chief operating officer of MTA before taking the helm at LIRR, is part of that agency’s culture, which “doesn’t care about costs, efficiencies and the taxpayers and riders,” and should be a “huge warning sign for the people of Massachusetts.”
“If you want a reliable and efficient MBTA, that gets to the heart of the problem with this agency, which is the workforce, the benefits, the costs and absolutely virtually no accountability,” Craney said. “This is not the right message you’re supposed to be sending to that agency. This is a status quo rubber stamp.”
Craney sees the hire as being most beneficial to the MBTA’s unions, saying that Healey put a general manager in place who’s “not going to rock the boat, and if anything, be more generous with them.”
An MTA annual overtime report from April 2022 shows overtime costs actually dipped at Long Island Rail Road throughout each year of Eng’s tenure, from $219 million in 2018 to $174 million in 2021. Eng retired in March 2022.
But the latest payroll data on the public transparency site Empire Center shows the OT problem there, much like at the MBTA, still exists.
The highest overtime earner at the Metropolitan Transportation Authority in 2021 was a machinist federal inspector from the Long Island Rail Road, who took in $224,526 worth of OT that year. This put him in the top-20 for highest-paid MTA employees that year, despite only making a base salary of $75,752.
Three other Long Island Rail Road employees are in the top 10 for overtime that year, taking in far more for OT than they did for their actual base salaries, according to the database, which is a familiar scenario to those watching the MBTA payroll in recent years.
Seven MBTA employees were among the state’s top 20 highest overtime earners in 2022, according to payroll data from the Massachusetts Comptroller’s office. A foreperson/wireperson was the runner-up, with the $261,852 he made in OT boosting his total pay to more than $413,000.
Taxpayers are already taking a hit in 2023 as well, according to payroll data, which shows 18 MBTA employees have already made more than $10,000 in overtime four months into the year, with one transit police officer exceeding $15,000.
The MBTA declined to make Eng available for an interview, but provided a statement that said his emphasis would lie more on getting bodies at the agency, which needs to make roughly 2,000 hires to deliver safe service, according to a report issued this week by the Massachusetts Taxpayers Foundation.
“As general manager, Phil Eng will be committed to supporting the MBTA’s workforce, increasing hiring and retention, and protecting the integrity of the payroll system,” T spokesperson Joe Pesaturo said.
“While overtime is an important tool, Phil will be focused on ensuring that the workforce has clear direction and the appropriate resources and support needed to deliver the safe, reliable service that our riders expect and deserve.”
To retain and attract more workers, the MBTA negotiated a more favorable pension agreement with its largest union, the Boston Carmen’s, this year, and announced this week that it was offering signing bonuses for more positions.
A Healey spokesperson declined comment, referring the Herald to the statement provided by the MBTA.