Once again Governor Corbett has nixed the pleas for his help in getting more money for the Port Authority. In response to a question on funding, the Governor said he is "not prepared to do anything" until he "sees movement" in contract negotiations. In holding firm he continues to keep the pressure on the unions and retirees of the Authority to make significant concessions, the only way the Port Authority can ever hope to deal with its massive legacy cost and compensation problems.
The game of chicken the unions have always played leading up to the end of contract deadline is underway again. In the past few negotiations, the threat of a strike has been explicit or implied as a way of getting the management to give up its demands or to get a Governor to find extra money taken from highway funds as a temporary fixes to the Authority’s finances. Having always won these contests of will in the past, the unions and retirees are inclined to believe the current Governor will give in at the last minute rather than watch the implementation of the massive service cuts Port Authority management say are coming in September.
If history holds, the real test of the Governor’s position will occur at the end of the contract if the unions go on strike or in August just before the service cuts get implemented. But this is a contest the Governor must win if sanity is to return to Port Authority financial management.
The Allegheny Institute continues to recommend a one- time boost in state assistance of $30 million in exchange for a substantial permanent reduction on retiree health care benefit concessions, current compensation concessions and a no strike pledge for ten years.
Governor Corbett has shown real grit in refusing to acquiesce to the entreaties by some and scurrilous name calling by others demanding that he come up with more funding for the Port Authority. In fact, his adamant unwillingness to capitulate to those demands is the only reason the transit unions have any motivation to even consider making any concessions on wages or benefits.
Enter the Post-Gazette editorial writers with specious arguments and adding their voice to the clamoring cries that the Governor act soon. First, they point out -again-that the Governor’s task force on transportation made recommendations several months ago and he has declined to say what, if anything he will support from the those recommendations. The ed writers might want to remember that Governor Rendell’s 2006 task force on transportation made many recommendations for PAT including a call to begin explore competitive contracting. Not a single route has been privatized.
Secondly, the P-G mentions that the unions made concessions totaling $93 million. What they don’t say is that those savings are spread over many years. That’s a start but not nearly enough in the face of the billion dollars in unfunded benefit liabilities facing the Port Authority. What PAT needs are savings in current outlays and those have been reduced only through laying off employees. And that requires serious cuts in wages as well as concessions by retirees. Until those are forthcoming PAT will continue to strangle on excessive pay and retiree benefits.
So, until PAT’s unions and retirees are willing to make some serious concessions the Governor is right to hold firm. Any indication from him that he might yield to the mounting pressure to come up with additional funding will only encourage the unions to back away from concessions. This is the game of chicken they have played for years and have won. They must not be allowed to win again.
The newly installed County Exec, after declaring he would be leading the charge in PAT labor negotiations, has made his way to Harrisburg to lobby for more funds for all but bankrupt Port Authority. He will argue that the looming $64 million deficit and the cuts in service it will require could have serious negative effects on the region’s economy.
What he will not tell the legislators about is the lack of progress by PAT in getting any meaningful concessions from the transit unions or retirees. Therein lies the principal root of PAT’s financial problems but nothing significant ever gets done to lower immediate cost other than lay off employees and cut bus service. The Exec has not once indicated he will press for major concessions by the retirees or union members. Hence the legislators should politely indicate the way out of their offices to the Exec.
More money for PAT now will only beget the cries for more money next year.
Really hard to enact bills need to be passed by the state government to address PAT’s fiscal situation. We have outlined those on many occasions. Eliminate transit workers’ right to strike, eliminate PAT’s monopoly in Allegheny County, and amend state law to allow PAT to declare bankruptcy. There is no other way to reduce the enormous burden of legacy costs that are driving the Authority into the ground.
The question is, do the Governor and the General Assembly have the intestinal fortitude to face down the Exec and the unions and do what needs to be done?
Upon a moment’s reflection there is an obvious and glaring flaw in a newly appointed commission set up for the express and single purpose of looking for funding sources for the state’s transportation systems. Here’s a better idea. How about a commission to look for ways to solve the problems facing transportation?
For one thing, the eagerness to lump mass transit in with highways and bridges is a mistake. There are vastly different issues involved that should be examined separately. Transit operations are localized and have localized issues. Port Authority in Allegheny County, for example, is beset by vast financial problems of its own making and more funding will not solve them until the underlying problems are addressed.
Then too, road and bridge work faces unnecessarily high costs because of the requirement that employees on these projects be paid a prevailing wage. Before the Governor or the Legislature enact any new funding plan for transportation, they should take a long, hard and honest look at how much the prevailing wage requirement is adding to the annual cost of supporting transportation projects.
Further, do we know for sure that the engineering, design, and implementation procedures-including letting of contracts-used by the state are the best available and devoid of political favoritism? If not, why not?
This commission, with its unfortunate single focus on finding funding sources, is missing an important opportunity to find ways to save money or do things more efficiently. Looking for funding only sends a message that enables the spenders of the money to be less assiduous in their search for cost savings.