Section 5. The authority shall be subject to the following limitations, conditions, obligations and duties:

(a) The authority shall have the duty to develop, finance and operate the mass transportation facilities and equipment in the public interest, consistent with the purposes and provisions of this chapter, to provide a high standard of service to its riders, and to achieve maximum effectiveness in complementing other forms of transportation in order to promote the general economic and social well-being of the area constituting the authority and of the commonwealth. Said duty shall provide that no person shall, on the grounds of age, race, sex, religion, creed, color, sexual orientation, national origin, or handicap, be denied participation in, or the benefits of, or be otherwise subjected to discrimination under any program or activity administered or operated by or for the authority.

(b) No real estate shall be sold unless the sale shall have been advertised at least once a week for three successive weeks prior to the date of sale in a newspaper of general circulation in the city or town in which the real property to be sold is located; provided, that no such advertising shall be required if a sale or conveyance of such real estate is made to the commonwealth or any political subdivision thereof or to any agency or instrumentality of either of them. Such real property shall, unless sold to the commonwealth or any political subdivision thereof or to any agency or instrumentality of either of them, be sold to the highest bidder subject to any restrictions, covenants, or conditions the authority shall find that sound reasons in the public interest require.

(c)(i) Any concession or lease of property for a term of more than one year or development agreement shall be awarded to the highest responsible and eligible bidder therefor unless the authority shall find that sound reasons in the public interest require otherwise. (ii) Any property which is the subject of a lease or development agreement pursuant to clause (i) shall not be subject to paragraph (o).

(d) No proposal for a systemwide change in fares or decrease in systemwide service of 10 per cent or more shall be effective until said proposal shall first have been the subject of one or more public hearings and shall have been reviewed by the advisory board and, for a systemwide increase in fares of 10% or more, the MBTA board has made findings on the environmental impact of such increase in fares and, for a systemwide decrease in service of 10% or more, the decrease shall be the subject of an environmental notification form initiating review pursuant to sections 61 and 62H, inclusive, of chapter 30. Any systemwide increase in fares of 10 per cent or more shall conform to the fare policy established pursuant to paragraph (r). The authority shall increase fares only to provide needed revenue and shall not increase fares soley for the purpose of funding the stabilization fund established pursuant to section 19.

(e) The board shall not establish a fare in excess of one-half the regular adult cash fare for pupils of public day or evening schools, pupils of private day schools or private evening schools or industrial day or evening schools giving substantially the same character and grade of instruction as the schools conducted at public expense and of a not higher grade than a high school for transportation between such schools and their homes, or for children between the ages of five and 11 years, inclusive, or for persons 65 and older who reside within the commonwealth, or for persons with disabilities who reside within the commonwealth. Any such fare so established shall provide for free transfer privileges.

(f) If the authority seeks to contract for local and express bus services theretofore performed by authority employees, it shall conduct a public hearing in each of the affected areas. The authority shall cooperate with the chief executive officers of each of the cities and towns in the affected areas to determine the appropriate, geographically convenient locations at which such hearings shall he held. Said hearings shall be held within 30 days after the authority's requests for proposals and before the awarding of a contract for said services. The authority shall provide written notice 10 days before the hearing to elected officials from affected areas. The authority shall be represented at the meeting by the general manager or his designee and a representative of the authority who is familiar with the proposed contract. The public hearing shall be conducted in the evening hours in a location in the area to be affected by said proposed contract. The authority shall present reasons for the proposed contract. Persons in attendance at the public hearing shall have a reasonable opportunity to ask questions and present reasons why such proposed contract shall not be executed. Within 30 days after said hearing and before the execution of any contract, the authority shall give written notice of its decision and the reasons there for to persons who received written notice of the hearing. The authority shall continue to conduct public hearings pursuant to this subsection each year the contract is in effect. Nothing in this paragraph shall be construed as affecting the applicability of sections 52 to 55, inclusive, of chapter 7 to any such contract.

(g) The authority shall establish a program for mass transportation consistent with this chapter. The program for mass transportation and any revisions thereto shall be submitted for comment and recommendation to the advisory board not less than 60 days prior to the adoption thereof. The authority shall prepare a written response to reports submitted to it by the advisory board which response shall state the basis for any substantial divergence between the actions of the authority and the recommendations contained in such reports of the advisory board. The program shall be reviewed not less than every 5 years to evaluate the achievement of its aims and to re-evaluate its conformity with this chapter.

Said program for mass transportation and any plans specified therein shall be implemented by the capital investment program, including a rolling five-year plan. The capital investment program and plans of the authority shall be based on an evaluation of the impact of each proposed capital investment on the effectiveness of the commonwealth's transportation system, service quality standards, the environment, health and safety, operating costs, the prevention or avoidance of deferred maintenance, and debt service costs. Capital investments that result in the greatest benefits with the least cost, transit commitments made in connection with the central artery project, so-called, capital improvements required under the Americans with disabilities act, and capital expenditures for an ongoing schedule of maintaining the equipment and mass transportation facilities of the authority, shall receive the highest priority under said capital investment program and plans.

Said ongoing schedule of maintenance shall be designed to prevent the deferral of routine and scheduled maintenance, and shall be undertaken prior to investing in new facilities or service expansion, unless the latter required by law or can be demonstrated to be cost-effective, environmentally beneficial or produce quantifiable savings.

The capital investment program shall be prepared on an annual basis, under the direction, control and supervision of the authority. The program adopted by the board, including plans for each project funded therein, shall be available for public inspection and submitted to the department, the joint committee on transportation and the senate and house committees on ways and means not later than 60 days prior to the start of the fiscal year.

Said program for mass transportation, the capital investment program and the plans for each such project funded therein shall be developed in conjunction with other transportation programs and plans proposed by the department, including any plans of regional transit authorities established pursuant to chapter 161B. Said programs shall be further developed in consultation and cooperation with the department, and in consultation with the department of housing and community development, the metropolitan area planning council, the executive office of environmental affairs, and such other agencies of the commonwealth or of the federal government as may be concerned with said program and plans.

The plans for each project included in the capital investment program shall identify the purpose and intended benefits of each project, the total budget and timeline necessary to complete each project, the amount of said total which is budgeted for each project in the next fiscal year, the operating costs and savings, if any, anticipated to be incorporated in the operating budget of the authority upon completion of each project, the proposed operating costs and costs of routine and scheduled maintenance associated with each project upon its completion, and the expected useful life of each project.

The capital investment program shall be based on a rolling five-year plan, updated annually, that establishes the priorities and cashflow needs of the capital borrowing program of the authority. The five year plan shall be accompanied by a timeline for the implementation of the projects and priorities established therein and comprehensive financial estimates of the capital and operating costs and revenues associated with each project established by the plan.

The authority shall conduct a series of public meetings within 30 days of issuance of an initial draft of the capital investment program and shall submit a final capital investment program to the advisory board, for its review, no later than January 15 of each year.

The authority shall be responsible for the architectural, engineering design, and the construction of mass transportation facilities and for the operation thereof.

(h) The authority shall on or before April 1 of each year, render to the department, the governor, the advisory board, and the general court, a report of its operations for the preceding calendar year, including therein a description of the organization of the authority, its service quality standards, trends in revenue and ridership, service improvements and recommendations for legislation, if any, and the program for mass transportation as most recently revised.

(i) Any agreement entered into by the authority with a municipality outside of the territory of the authority for service to such municipality directly by the authority, or through agreement with a private company, shall provide for reimbursement by such municipality to the authority only for the net additional expense of such service as determined by the authority. Such agreements may be for such terms, not exceeding five years, as the parties may determine, except as provided in paragraph (f) of section 3. They shall not be subject to the provisions of section 4 of chapter 40 or section 31 of chapter 44. Municipalities may appropriate from taxes or from any available funds to meet their obligations under any such contracts.

(j) Any private company lawfully providing mass transportation service in the area constituting the authority at the time the authority is established may continue to operate the same route or routes and levels of service as theretofore, and may conduct such further operations as the authority may permit in the future with or without a contract; provided, that the authority shall in all respects have the same powers and duties in respect to such private carriers as are provided by law for the department of telecommunications and energy except as to safety of equipment and operations, schedules and routes not being, however, considered safety of equipment and operations for the purposes of this paragraph; and provided further, that whenever the authority desires to add new routes for service in any area, it shall give preference in the operation of such routes to the private carrier then serving such area unless the authority concludes that such carrier has not demonstrated an ability to render such service according to the standards of the authority, that such service can be operated directly by the authority at substantially lesser expense to the authority and the public than if operated by such private carrier, or that for substantial and compelling reasons in the public interest operation by such private carrier is not feasible.

(k) The board of directors is hereby authorized and directed to promulgate such rules, regulations and procedures, including public hearings, as are necessary and appropriate to provide the following parties the timely opportunity to participate in the development of major transportation projects designed by the authority, as defined by the directors, and to review and comment thereon: (i) state, regional and local agencies and authorities affected by said projects; (ii) elected officials and riders or potential riders from cities and towns affected by said projects; (iii) other public and private organizations, groups and persons who are affected by, and who have provided the board with reasonable notice of their desire to participate in the development of the design of said projects. In this section, the words ''timely opportunity'' shall mean sufficiently early in the design process so as to permit comments to be considered prior to the final development of or commitment to any specific design for such project.

(l) The authority, during construction projects, may require the relocation or removal of public utility facilities; provided, that if such project is in whole or in part funded by a federal grant, the authority may reimburse said utility for such costs of relocation and removal as may be agreed upon by said utility and the authority.

(m) The authority shall provide gate attendants daily from seven o'clock ante meridian until two o'clock ante meridian on the following day, on High street in the city of Medford at the railroad crossing.

(n) No alcoholic beverages shall be sold on any of the properties under the supervision and control of the authority, its tenants or lessees; provided, however, that this subsection shall not apply to properties used for railroad purposes, as defined in chapter 160, including all properties used for railroad-related purposes, including, but not limited to, railroad stations and terminals.

(o) No person shall have in his possession on a facility or conveyance under the supervision or control of the authority, alcoholic beverages with the intent to consume same on said facility or conveyance except as provided in paragraph (n). A violation of this subsection shall be punishable as provided in section 40A of chapter 272 and said alcoholic beverages shall be forfeited to said authority.

(p) To create, after public hearing and in consultation with the advisory board, mechanisms for ensuring reliable, high-quality and cost-effective operations by establishing and implementing service quality standards.

(q) To promote, in consultation with the advisory board, maximization of fare revenue and nontransportation revenue, described herein, through reasonable and equitable fares, ridership growth, and transit-oriented development of land and air rights controlled by the authority.

(r) To adopt, and revise as appropriate, a fare policy which addresses fare levels, including discounts, fare equity and a fare structure, including, but limited to, fare media and passes. Said fare policy shall include a system for free or substantially price-reduced transfer privileges.