August 16, 2017

State turns to Texas exec Ramirez to fix MBTA

State House News Service
Luis Ramirez.

Luis Ramírez, who handled a $3.5 billion line of business for General Electric and runs his own turnaround consulting firm based in Texas, will take the reins as the new general manager and CEO of the MBTA, charged with bringing "transformative and lasting change" to the transit agency.

Under the three-year contract, Ramírez will be paid $320,000 per year with 1.5 percent annual raises, and he may also receive performance-based bonuses - a relatively novel contract feature for MBTA chiefs. Ramírez starts Sept. 12.

Incoming MBTA General Manager Luis Ramírez will take over Sept. 12 from interim GM Steve Poftak (right). [Photo Gallery: Sam Doran/SHNS]

Steve Poftak, the executive director of the Rappaport Institute for Greater Boston, has served as interim GM since July 1, pulling in a salary annualized to $260,000. Brian Shortsleeve, who took over as acting general manager last year before returning to the private sector, made $175,000 per year.

If Ramírez achieves "clearly defined milestones" that Transportation Secretary Stephanie Pollack said would be established with the Fiscal and Management Control Board, he can receive up to $32,000 in performance bonus his first year, with the size of the bonus increasing to 20 percent of his annual base salary in year three. On mutual agreement the contract can be extended an additional two years.

Ramírez was raised in south Florida and piled up his business experience in other states. He said he has traveled to Boston for business and rode the MBTA.

"My feeling is that we have a lot of room for improvement," Ramírez said. He said, "There's a lot of capability here."

The general manager of the MBTA is a high profile position serving a customer base conditioned to expect delays and crowding and not shy about expressing their complaints about the service's shortcomings. The agency is also embroiled in controversy and debate over efforts to privatize some of its services.

"I've been making some phone calls this morning and there's a lot of people who want to talk to you, and this is Boston - they'll have a lot of advice for you so that will be great," said Pollack.

Ramírez's wife, Delia Garced, is vice president of Market Activation at GE Digital and she will work out of GE's Boston headquarters. Ramírez, who will receive up to $60,000 for relocating, said he is looking for a place to live and has friends from the Boston area.

"I have a lot of friends here," Ramírez told reporters. He said, "I know a lot of people here."

"We plan to be here for a long time," Ramírez added, saying he has always wanted to serve in the public sector.

Pollack previously said she would offer a competitive salary to attract a top candidate and while the T is offering Ramirez a considerably higher salary than his predecessors, Pollack said she is sure he could command higher earnings in the private sector. On Tuesday she said, "Transit expert was not high on our priority list." She said the search that started six months ago attracted 300 candidates with public and private sector experience.

A graduate of DeVry Institute of Technology and the Fuqua School of Business at Duke University, Ramírez worked at Siemens Global Business for over a decade, according to his resume, which said he is fluent in Spanish and German and has working knowledge of French and Italian.

In 2015, Ramírez left Global Power Equipment Group and founded the Dallas-based TodoModo Group, a business consultancy that works on turnarounds. From 2000 to 2012, he worked at GE, rising to the position of CEO of GE Energy Industrial Solutions, where he oversaw mining, rail, datacenter, electric vehicle, solar and other industrial areas.

Pollack, who has statutory authority to appoint the new GM, said she consulted with control board members on her choice to lead the T. Shortsleeve is now on the control board and Poftak plans to return to his position on board, which vets and questions MBTA management decisions.

Ramírez will be the fifth head of the MBTA under Pollack, who has been Gov. Charlie Baker's transportation chief since he took office in 2015.

The historic winter storms of 2015 laid bare the MBTA's performance and infrastructure deficiencies and set in motion a series of shifts at the top of the agency that oversees buses, trains, trolleys, subways, ferries and paratransit vehicles.

The funds to fix the T "are there," Ramírez said, "and we must do a better job getting them through the door."

Pollack said the T is in the middle-phase of a turnaround.

"You're still not seeing the results you want to see and that's when things get tough. And that's the phase the T is at now. A lot of progress, but not enough in terms of the service we deliver to our customers every day," Pollack told reporters Tuesday. "So I think the energy and the perspective that the new general manager's going to bring to the T is exactly what we need at this phase."

Ramírez, 50, has two children. He is the son of a Cuban refugee father who ran a crop-dusting plant and a roofing business in Florida, according to the T.

The last time the T searched for a new GM rather than promoting from within was 2012, when the agency hired Beverly Scott, who abruptly quit amid the 2015 service failures.

Ramírez said he has met with Baker, and had lunch with him in his office.

The Massachusetts Taxpayers Foundation, whose members include many major employers whose workers rely on the MBTA, applauded the choice of Ramírez.

"Mr. Ramírez's appointment is a terrific step forward in transforming the MBTA into the high-quality, customer-centric public transportation system that its riders deserve," Taxpayers Foundation President Eileen McAnneny said in a statement. "Mr. Ramírez's business background and expertise in complex turnarounds makes him the ideal person to lead the authority forward."

James O'Brien, president of the Boston Carmen's Union, the biggest labor group at the MBTA, said he hoped for more investment at the T and less conflict between labor and management.

"The MBTA has spent a lot of energy attacking its own employees, but if you ask riders if their experience is better, if their commutes are better, you will hear a resounding 'no.' If the Baker Administration is serious about improving the MBTA it needs to make real investments in the system's infrastructure- vehicles of all types, signals, and tracks," O'Brien said in a statement. "The MBTA needs strong leadership and stability, with a General Manager who empowers rather than attacks the people that try to keep this aging system running everyday. We hope that Mr. Ramírez provides the leadership the organization needs to move forward. If we all work together, we can bring Massachusetts the transportation system it deserves."

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