Amalgamated Transit Union

Transportation Nation

BART, Unions Begin Contract Negotiations as Agency Emerges from Deficit

Friday, April 05, 2013

BART train (photo by Keoki Seu via Flickr)

Rising ridership and sales tax revenues on San Francisco's BART system mean the agency is no longer operating at a deficit, which has triggered labor negotiations that could give union workers their first raise in four years.

BART contracts for its union workers – who make up almost 90 percent of BART’s over 3,000 employees– are set to expire on June 30th. And that has sent BART and union leaders to the negotiating table. Both sides are hoping to avoid the bitter and contentious fight that happened during the last contract negotiations in the summer of 2009.

But things were different in 2009. Ridership was declining, and the system was facing a $250 million deficit over the next four years. BART went into negotiations with the goal of cutting $100 million in labor costs through reductions in health care and pensions, and changing what they considered “wasteful” work rules, like unnecessary overtime. A last-minute deal that kept wages static, prevented a strike by the Amalgamated Transit Union Local 1555, or ATU – the union that represents the system’s approximately 900 station agents and train operators.

That deal did save BART the $100 million it wanted and laid out plans for four of the five unions and non-union employees to get a one percent raise if strict guidelines were met, including increased ridership and sales tax revenues. This week, BART announced the guidelines have been met, so most of their employees will be receiving their first raise in since 2009.

“With record ridership and an aging system, our employees are working hard to provide on-time, reliable service for our riders,” BART General Manager Grace Crunican said in a press release. “The bar was set high for our employees to receive this increase and the predefined standards were met.”

Since 2009, BART has increased its ridership – from 340,000 to over 390,000 in the latest monthly report. And it’s no longer operating on a deficit, but the system does have a $10 billion unfunded capital need for renovation and expansion projects.

“This year’s labor negotiations will be focused on bargaining a fair contract for our hard working employees as well as ensuring the long term financial health and sustainability of our system,” Crunican said.

BART says they’re looking at the same issues as last negotiation: employee health care, pensions, and work rules.

“We must pave the way for BART to continue to be the backbone of Bay Area transportation for decades to come,” Crunican said. “BART is looking to protect its future fiscal stability with measures to more effectively share the risks and costs associated with its employee benefits program.”

Antonette Bryant is the president of ATU Local 1555. She said calling last negotiation contentious was “a gross understatement.” But this time, she said, she wants to have the contract settled June 30th.

“We want them to pay a fair wage for our employees and increase safety and service for the BART patrons,” Bryant said. Meaning, they want a pay raise.

Bryant also said the one percent raise announced this week should not be considered as the transit workers’ only salary increase.

“I want to make it clear that this is not benevolent,” she said. “This is something they have to do. They owe us the money from the previous contract negotiations.”

As negotiations go on, both parties hope to have a deal by June 30th and to prevent the fighting that happened four years ago.

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Meeting Yields No Resolution of Bus Strike

Monday, January 28, 2013

The year 1979 was in the air today, as the mediator who helped negotiate the end to the 13-week school bus strike then, Judge Milton Mollen, returned to meet with both the union and representatives of the bus company owners at Gracie Mansion. The meeting ended with no reported progress.

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Legal Standoff Over Employee Protections at Heart of Strike

Tuesday, January 15, 2013

As school bus drivers and escorts prepare to strike, we look at what drove the two sides apart. The union claims the city is reneging on a promise to include employee protections in future contracts that guarantee wages and seniority rights. But the city claims a 2011 court ruling nullified those protections.

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Transportation Nation

Report: Transit Fares High and Rising? Blame Bailed-Out Banks

Thursday, June 07, 2012

(New York, NY - WNYC) A transit union says in a report that one cause of the New York Metropolitan Transportation Authority's recent fare hikes and service cuts has been hiding in plain sight: financial arrangements called interest rate swaps. Those are deals the authority made with banks on 10 percent of its $33 billion of debt —deals that have gone against the authority and in favor of the banks.

The deals were made between 1995 and 2007, when banks agreed to cover the fluctuating interest rates on some of the authority's bonds. In exchange, the NY MTA said it would pay the banks a fixed rate, plus a small premium. That agreement would've protected the authority if rates had jumped up. But the Amalgamated Transit Union says the NY MTA has taken a net loss on the deals since the economy crashed in 2008 and interest rates fell to sustained, historic lows.

The union says the authority is now losing almost $114 million a year ― and could continue to lose money on the deals for the next 20 to 30 years.

NY MTA spokesman Adam Lisberg disputed the union's calculations, saying the swaps brought predictability to the authority's budget, which needs to be balanced each year. "To compare transactions we entered into years ago, compared to what you can get in risky variable rate debt right now is either irresponsible or deliberately misleading," he said. "They are simply wrong."

He contended that the swaps allowed the authority to save $248 million. The report says that was true until 2007, when the arrangement allowed the NY MTA to pay off its debt at nearly a full point below interest rates that were relatively high. But that was before the economy tanked. Since then, the authority has lost money on the deal.

The report looked at 12 transit agencies or local governments that entered into interest rate swaps. The report's authors insisted in a conference call that, though the deals may have made sense when they were struck, these 12 agencies ― which includes the NY MTA and NJ Transit ― are now bleeding at least a half a billion dollars a year from the budgets of governments and transit authorities around the United States.

James Parrott, an economist with the Fiscal Policy Institute, called on agencies like the NY MTA to seek concessions from the banks, many of which received massive taxpayer bailouts.

He said he doesn't understand why the NY MTA isn't treating its bankers like any other business partners. “The MTA went to all of its vendors from 2008 to 2010 and got concessions from them to reduce the price of contracts," he said. "The only business they didn’t go to is the banks. Why?”

Parrott also noted that the NY MTA is about to go to market to sell billions in new bonds to refinance its capital construction program. "They could say to the banks, ‘If you’re unwilling to renegotiate these credit swaps, we’re not so sure you’re going to get a piece of these bonds,'” he said.

Lisberg called the idea unrealistic. "We need these major banks to provide financing for us," he said. "We’re constantly in the debt markets, it’s how we and every other large government organization works. If we’re buying equipment to use over 30 years, it makes sense to pay for it over 30 years."

In 2010, the NY MTA plugged a budget gap by laying off 1,000 workers and eliminating 750 positions. It also enacted some of the deepest subway and bus service cuts in decades. Riders absorbed a 7.5 percent fare increase in 2011, and further 7.5 percent increases are scheduled in 2013 and 2015.

The banks that hold interest rates swaps with the NY MTA are JPMorgan Chase, Citigroup, UBS, AIG, Morgan Stanley, BNP Paribas and Ambac.

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Transportation Nation

Union Chief: Want Safer Inter-City Buses? Raise Driver Pay. (Bus Owners Don't Agree.)

Monday, March 28, 2011

Chinatown Bus. (photo by Naomi A. / Flckr Creative Commons.)

(New York, NY - Jim O'Grady, WNYC) Three tour bus accidents in the Northeast this month have left dozens of people injured and seventeen dead. The inevitable calls for reform have followed, along with crackdowns on discount inter-city carriers through spot-checks of their buses.

Bruce Hamilton, president of the Amalgamated Transit Union, said all of that is appropriate but one measure to raise bus safety has been overlooked: better pay for drivers. His call for a minimum wage for drivers has drawn opposition, however, from a national bus owner trade association that says the industry is thriving because the competitive market, not government intervention, has set rates.

Hamilton says large bus companies like Peter Pan, Greyhound, Bonanza and others have the best safety records because drivers are paid higher wages--and that low pay on the discount lines cause some drivers to cut corners.

"Drivers are paid so low that they end up breaking the rules and they far exceed the maximum number of hours that drivers are allowed to operate," he said. "They become fatigued and they crash the buses."

U.S. Department of Labor stats from 2009 show the mean wage for bus drivers in New York is almost $23 dollars an hour, which comes to a little more than $47,000 dollars a year.

Hamilton says that’s true if you're a unionized driver at one of the larger carriers. He said drivers for the discount carriers, often called Chinatown buses, are paid a lot less.

His case is backed up by Michael Belzer, a professor of economics at Wayne State University who’s been studying the issue for ten years. Belzer has looked at a lot of federal safety data and found that for every 10% increase in driver pay, the probability of a crash is lowered by 40%.

But of course the discount bus industry has mainly been booming because of one thing: cheap tickets. For example, if you take an Amtrak train from New York to Philadelphia, you'll pay anywhere from 50 to $120. Hop on a discount bus and you'll get there for $10. But Belzer says those rock-bottom rates create an economic tension.

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