Jay Walder is currently the MTA CEO and Chairman because of the success he enjoyed in London and then at McKinsey as a transit consultant. A veteran of New York’s MTA, he helped turn around Transport for London and led an effort to modernize the system. Now, as New York’s transit network stands in need of some major investment and massive upgrades, Walder is looking to bring his team from London across the pond to help drag the MTA into the 21st Century.
He is surrounding himself with his team, though, in an interesting and intriguing fashion. Instead of contracting out to a high-priced consultant firm such as McKinsey, he has proposed a deal that would bring Transport for London officials to the states on a two-year, no-bid consulting deal. It is an unorthodox approach toward transit management, but it just might work. Micheal Grynbaum has the details:
The arrangement, unusual for a pair of public agencies, would be worth up to $500,000 and would pay for Mr. Walder’s former colleagues to fly across the pond and work as on-site consultants in New York. The Londoners’ salary and benefits, along with travel and lodging, would be covered by public funds.
Many of Mr. Walder’s top priorities for the New York system — including computerized, scannable fare cards and arrival-time clocks at bus and subway stops — are modeled after similar programs he introduced in London, where he worked until 2006. “Rather than having to bring in high-priced consultants, we’re getting experts with success already in doing these things, and getting them at public sector costs,” said Jeremy Soffin, a spokesman for the authority.
Staff members from the London agency would charge $125 to $200 an hour, according to a document released this week. The authority called those rates “fair and reasonable,” and said the fees were half what a private consultant might charge.
Reaction to the deal from transit experts and advocates was mixed. Nicole Gelinas as the conservative Manhattan Institute told Grynbaum that she is hesitant over the no-bid contract. “A no-bid contract with a former employer could set a bad precedent,” she said. “Mr. Walder has to bend over backwards here to explain what exactly these people will bring to the table that we can’t get through the expertise for which we’re already paying him.”
Gene Russianoff though was more willing to give Walder the benefit of the doubt. “I think he’s made a case that he’s going to get value for the deal,” the Straphangers Campaign head said. “He deserves a chance to do it on his own terms.”
In the end, the MTA Board will have to approve the contract, and even the no-bid nature of it shouldn’t turn them off from it. They don’t need to make it a precedent if they are clear that it is a one-time offer.
My only gripe with this deal is its duration. It is definitely a cheaper deal than one the MTA would sign with McKinsey’s transit experts, but does the MTA need a two-year treatment with Transport for London? Can they bring the good ideas with them for 12 months?
As Walder wraps up his third week in the job, he has shown a willingness to throw out new ideas and bring in new people with a background of success. His desire to succeed and his background as a transit expert — as opposed to a real estate magnate or politically-connected businessman — are manifesting themselves. We can only he can deliver the results we need.