Wednesday, August 08, 2007
Not Helping Their Own Cause
The Port Authority is in financial trouble. No one disputes this finding. The transit agency has been asking for more money from the state for years—and the Governor has been forthcoming, despite pleas from critics to demand reform. The Port Authority (PAT) had taken a very small step to reform by cutting a small percentage of service and laying off some employees. But this is an agency in dire straits that needs drastic changes to the way it’s being operated. In the next few years PAT will see a tremendous increase to pension obligations and health care costs, especially for its current retirees.
In order to do this PAT will need cooperation from its union by asking to reopen current labor contracts. The transit agency needs to get immediate concessions on work rules and compensation packages as well as the ability to use smaller buses to run the less used routes and to competitively contract out bus services.
But getting the union to seriously consider these requests will be extremely difficult as long as they continue to spend money on outrageous capital projects like the North Shore Connector and the Governor and Legislature continue to throw money PAT’s way. After all why should they capitulate on any cost effective measure if money from the state keeps flowing? Most importantly why should the union reopen its contract and make concessions when management’s abuses keep coming to light.
The most recent episode involves former CEO Paul Skoutelas who sued after PAT reduced his monthly pension payments by a third. The lawsuit has brought to light the details of the pension which include the Authority buying 11 years of service for Skoutelas when others had to buy their own service years. He had also been the beneficiary of a controversial retirement option program PAT’s board had approved on his recommendation. In all he managed to pad his pension payment to more than $9,000 per month. The simple response from the president of PAT’s union: “Wow!”
This reflects a culture of lavish spending during his 8-year tenure as the CEO. A time when more than $1 billion of capital projects had been undertaken or planned—the Wabash Tunnel HOV project, the West Busway and East Busway extension, the South Hills parking garage, and of course the North Shore Connector. This was done at a time when ridership has been essentially flat and costs have been escalating. This shows a complete lack of respect for those who depend on mass transit and especially to the taxpayers who are asked to fund it.
How will PAT ever expect the union to give concessions when they can’t instill trust and confidence they are doing everything they can on their own end to control costs and ensure efficiency? While the new CEO has taken steps such as reducing the salaries of management to show good faith in cutting costs, the culture of corruption and back room bargaining still resonates. If its own union shows no faith and confidence in the transit agency why should taxpayers?
In order to do this PAT will need cooperation from its union by asking to reopen current labor contracts. The transit agency needs to get immediate concessions on work rules and compensation packages as well as the ability to use smaller buses to run the less used routes and to competitively contract out bus services.
But getting the union to seriously consider these requests will be extremely difficult as long as they continue to spend money on outrageous capital projects like the North Shore Connector and the Governor and Legislature continue to throw money PAT’s way. After all why should they capitulate on any cost effective measure if money from the state keeps flowing? Most importantly why should the union reopen its contract and make concessions when management’s abuses keep coming to light.
The most recent episode involves former CEO Paul Skoutelas who sued after PAT reduced his monthly pension payments by a third. The lawsuit has brought to light the details of the pension which include the Authority buying 11 years of service for Skoutelas when others had to buy their own service years. He had also been the beneficiary of a controversial retirement option program PAT’s board had approved on his recommendation. In all he managed to pad his pension payment to more than $9,000 per month. The simple response from the president of PAT’s union: “Wow!”
This reflects a culture of lavish spending during his 8-year tenure as the CEO. A time when more than $1 billion of capital projects had been undertaken or planned—the Wabash Tunnel HOV project, the West Busway and East Busway extension, the South Hills parking garage, and of course the North Shore Connector. This was done at a time when ridership has been essentially flat and costs have been escalating. This shows a complete lack of respect for those who depend on mass transit and especially to the taxpayers who are asked to fund it.
How will PAT ever expect the union to give concessions when they can’t instill trust and confidence they are doing everything they can on their own end to control costs and ensure efficiency? While the new CEO has taken steps such as reducing the salaries of management to show good faith in cutting costs, the culture of corruption and back room bargaining still resonates. If its own union shows no faith and confidence in the transit agency why should taxpayers?
