As July came to a close two weeks ago, the MTA released a bit of good budgetary news. According to their early projections, the agency would require no fare hikes to keep their books in order for 2010. Considering the back-to-back fare increases over the last two years, this announcement was a good one indeed.
As this week has unfolded with news of an arbitrator-awarded pay increase for New York City Transit’s TWU workers, the MTA has backtracked on that promise. As Newsday reports today, this increase — four percent in both 2010 and 2011 and three percent in 2012 — may may require future fare hikes as the MTA looks to cover an unexpected gap of $350-$400 million.
For most New York straphangers — myself included — the initial reaction was one of outrage. How could the arbitrator, in bad economic times, be so blind to the MTA’s fiscal reality? How could the TWU be so callous in its hunt for higher wages? We pointed fingers firmly at organized labor.
But after a series of conversations I’ve had with union officials over the last 24 hours, I have to reassess my position. In this case, I have come to believe that the TWU is not to blame for any future fare hikes the MTA may have to enact in 2010 to cover these unexpected labor expenditures. Rather, poor planning, even in the face of an impending increase, has yet again put the MTA in a hole.
According to union spokesmen and leaders, this whole arbitration process went something like this: Last year, after the economic downtown, the city of New York guaranteed raises of four percent to many unions, including teachers, sanitation and corrections workers. As the MTA and the TWU headed toward arbitration and as the process continued, TWU officials and their MTA counterparts seemed to recognized that a four-percent wage increase for 2010 would not be out of the ordinary.
Now, generally, faced with this reality, an agency would budget in enough money to cover any potential increase. Therefore, when the MTA released its preliminary 2010 budget two weeks ago, it should have factored in wage increases of four percent for its workers. Instead — and inexplicably — the MTA assumed it would have to dole out increases of just over 1.5 percent to its workers. According to TWU officials privy to the arbitration process, when the end of July rolled out, it was clear that the MTA would most likely be on the hook for that four percent increase next year.
So where does this leave us? As the finger-pointing continues on into the week, it appears as though any potential fare increase in 2010 due to rising labor costs would come about because the MTA did not adequately prepare its budget. Maybe this happened because MTA officials were overly confident of the arbitration outcomes. After all, that attitude has seemingly killed one-person train operations for now. Maybe the MTA was truly blind-sided by the arbitration result. Either way, I no longer feel it is fair to blame the TWU for this turn of events. This one may very well be on the MTA — and our wallets.