Transit Pact on the Table

According to published reports and a news release from the County Executive’s office, there is a tentative deal between the Amalgamated Transit Union and the Port Authority that represents "the first step" to avoiding the service cuts and layoffs scheduled to go into effect September 2nd.

There will be scant details until the contract is voted on, sometime around August 19th. Therefore, any comment as to what is in the contract or what the contract does vis a vis the state putting up money for closing the 2012-13 deficit is speculation.

What can be commented on is how this contract process compares to the 2005 and 2008 contract expirations and negotiations. The last contract was not voted on until December of 2008, some six months after it expired. In 2005 it took until November of that year. If the present contract is approved it will have been a considerably shorter time frame. The 2008 contract also went to fact finding, and that process was not even completed until the end of August 2008.

Going back to January 1, 2006, ATU wages have gone up 3% per year with the exception of 2010, when the increase was 2%. Employees are paying 3% of their wages toward health care coverage. The 2008 contract also truncated employees into various classes based on age and length of service to determine post-retirement health benefits.

Pittsburgh Group Warns of Harm From PAT Service Cuts

Weighing in on the impending slash in bus service in September, an organization called the Pittsburgh Community Reinvestment Group has issued a report claiming that the 35 percent reduction in service will create additional costs for Allegheny County residents of between $328 and $405 million per year. Higher commuter costs, more congestion, and increased parking rates are the principal drivers of the group’s estimate. The group could have added the loss of business revenue that will occur. Hard to estimate but it is almost certainly a significant number.

But the group-an advocate of more state money for transit-is missing two important considerations. First, the crisis at PAT did not arise because of inadequate state funding. The crisis is a product of decades of kowtowing to union demands for pay, benefits and work rules under the threat of transit worker strikes and the damage that inflicts on the community. The Reinvestment Group might want to go back and estimate how much the excessive costs created by the over generous contracts have cost state and local taxpayers and transit users over the last decade. The Allegheny Institute has reported frequently on PAT’s expenditure levels over the years. A reasonably solid estimate could be calculated fairly quickly.

Second, if the impending cuts do occur and appear to be permanent, there will be openings for new transit providers to begin offering service. The recently passed law stripping the Port Authority of its monopoly status will permit regional transit agencies and private carriers to initiate service to pick up some of the slack. PAT should be in discussions with regional transit agencies about how they can coordinate the introduction of service in area and on routes where major cuts are coming. This would include leasing buses to the agencies for a dollar a year to help keep their costs down. PAT could enter into contracts with private companies to cover routes about to be shut down.

PAT should begin these conversations immediately and announce they are doing so as a way to force concessions out of the unions. A transit strike is still a high probability event since the driver and mechanic contract has expired. By encouraging other carriers to offer service and coordinating with the new carriers PAT can make clear that business as usual is not happening. Finally, the state ought to eliminate the right to strike as soon as it returns from summer break. And it could add a provision to replace the Port Authority with a state appointed management team to prepare a bankruptcy filing-the only sure way to do something about the legacy costs that are crippling the Authority.

Retired Prof Illustrates the Perils Academe Creates for the Economy

One Charles McCollester, retired professor of Industrial and Labor Relations at Indiana University of Pennsylvania, writing in the P-G letters column reveals for all to see which side of Industrial and Labor Relations he shows solidarity with.

In the letter the retired prof launches a withering attack against Governor Corbett saying he is the most anti-labor governor since the late 1920s. And what does he base this on? First, he berates the Governor’s refusal to turn over more state dollars to the Port Authority unless there are substantial union concessions. This is an Authority that is in financial chaos owing to overly generous labor contracts in the past that have created legacy and compensation costs the Authority cannot afford absent the state taxpayers heaping more dollars onto a system that cannot be saved short of bankruptcy. The professor should do modicum of research before weighing in on a situation he knows precious little about.

Second, he caterwauls about trying the Governor’s attempt to break the teachers’ unions by slashing school spending and recommending vouchers. Apparently, the well- publicized huge budget deficit facing the Governor last year and the need to cut spending did not reach Indiana. Or if it did, the professor chose to ignore or believed it was all a Republican trick. Perhaps the professor does not believe that school employees should share in the financial hardship so many Pennsylvania taxpayers were going through during the economic downturn. And, it is also apparent that the refusal of teachers to make voluntary small sacrifices such as deferring pay increases in cash strapped school districts was entirely justified. Stick it to hard pressed taxpayers-that’s the ticket according to those who share the world view of the professor.

Vouchers for kids in grossly inadequate public schools? No way say opponents. That would undermine the wonderful public school monopoly the teachers and other members of the educational establishment enjoy and benefit so handsomely from.

And the professor wraps up his know-nothing screed by attacking the foundation community in Pittsburgh for asking the financially distressed Pittsburgh school district to consider the quality of teachers to be let go as opposed to following strict seniority rules. His argument-stop the cost cutting in the first place. Clearly, the professor has not followed the many reports of the excessive cost structure in Pittsburgh schools where spending tops $21,000 per student and academic performance in many school buildings is below miserable. The legacy of refusal to even nod in the direction of real reforms and the damage done to the cost structure by unions and do-gooder educrats have essentially ruined what was great school system. Time to pay the piper has arrived and all the professor can do is cry about the attack on seniority rules that are one of the biggest factors creating the long slide to a sub-mediocre school district.

How many Indiana University students have had their view of the world hopelessly distorted by the professor and the legions of other faculty members like him?

Governor Holds Firm on PAT Funding

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.