How the MTA spends its billions. (via)
It’s never much fun to begin a new year on an ominous note, but unfortunately, turning the calendar page to January did not fix New York State’s or the MTA’s fiscal problems. With a new governor — one who is, for now, scandal-free — ready to take on Albany with some strong rhetoric, labor costs are in the crosshairs, and unavoidably, Andrew Cuomo’s stance toward the state’s powerful public unions will ensnare the MTA too.
As The Times reports today, in his first State of the State address, Gov. Cuomo will uphold one of his major campaign promises as he will attempt to freeze state wages for at least a year. Considering the state’s $9 billion deficit, a wage freeze would be more symbolic than anything else, but as one anonymous Cuomo official said, the new governor, a labor-endorsed one at that, has to start his tenure off on the right foot.
“The governor said during his campaign that the difficult financial times call for shared sacrifice,” the official said to The Times. “A salary freeze is obviously a difficult thing for many government workers, but it’s necessary if the state is going to live within its means.”
Nicholas Confessore of The Times offers up a bit more:
[B]ecause such a step would not require legislative approval, Mr. Cuomo could achieve it while bypassing the Assembly speaker, Sheldon Silver, and the Democratic-controlled State Assembly, labor’s most powerful allies in Albany.
Of course, a freeze — which Mr. Cuomo promised he would seek during his campaign — would be subject to negotiation with the unions. But labor contracts for the vast majority of the state’s 190,000 employees expire on March 31, giving Mr. Cuomo an opening to seek changes at a time of public unease toward government workers’ benefits.
Salaries, health care and pension benefits for state workers represent one of the largest and fastest-growing areas of spending, accounting for about one-fifth of all state dollars.
Budget advocates have been quick to embrace Cuomo’s pledge. Elizabeth Lynam, a vice president at the Citizens Budget Commission, is looking forward to the brewing labor fight. “It’s a shot across the bow at organized labor, which has to date been uncompromising,” she said. “Hopefully it will lead to broad-based changes in the way state employees are compensated.”
Now, enter the MTA. At the end of 2010 and for the third year in a row, the MTA had to raise fares, and in 2011, for the third year in a row, many of its unionized workers — those belonging to the Transport Workers Union — will enjoy a raise for the third year in a row. MTA CEO and Chairman Jay Walder has already vowed to work toward a net-zero increase in labor spending, and if the workers are earning more, that simply means there will be fewer of them on the MTA’s payrolls.
Meanwhile, later this year, the MTA and the TWU will head to the bargaining table to hammer out another labor pact, and you can bet that Cuomo and his team will watch these negotiations far more carefully than Gov. Paterson did in 2009. Under the microscope will be the MTA’s pension and benefits obligations. In 2010, 19 percent of MTA expenditures went to fund pensions (nine percent) and health & welfare benefits (10 percent). Total expenditures in those categories topped $2.1 billion, and by 2014, that number is expected to raise to at least $2.7 billion. It’s certainly a plus today for the MTA’s bottom line that the TWU wasn’t successful in its 2005 effort to lower its retirement age from 55 to 50.
Essentially, we’re sitting on the edge of a dangerous game. If Cuomo is successful in instituting this wage freeze, the TWU will be firmly in his crosshairs, and he will apply tremendous pressure on the MTA to give up no ground. Another strike would likely result in the end of the TWU as a viable union but giving up ground to the authority will lead current president John Samuelsen exposed to an already-disgruntled rank-and-file.
For better or worse, labor pressures will be one of the top transit storylines for 2011. If workers’ salaries and benefits keep going up, riders will be outraged. If the unions are battered or broken by Albany, the workers will be very unhappy. No matter what, this story will be have a bumpy ride and an ending that can’t be happy for everyone.
28 comments
Happened upon a 5 year old post/item at the New York Observer the other day about Pataki’s horrible budget shenanigans. Item predicted that in 3 years from then there’d be an $11B hole in the budget. S
o the good news is that they were off by $2B dollars…
Pataki? You mean the interim 4 years during which NYS spent around $500 billion in total budgeted spending couldn’t have addressed the problem? Seriously, Pataki?
A quarter of the budget, $3 billion, for pensions and debt service. Lord help us.
Debt service is almost twice as much as pensions.
After this year I’m not expecting a raise for many years. I think we’ll end up working without a new contract for a number of years, a first for the TWU but something experienced by other MTA outfits.
I’d like to see some figures on just how many pensioneers start collecting at age 55. Most transit workers I see can’t afford it or they don’t have the time in service,i.e. they started working there after age 30.
I certainly support the wage freeze, but it’s worth remembering that there is a host of other options that can serve to balance the MTA budget, from congestion pricing to one-person train operation to restoring state funding to changing work rules to having workers contribute for pension and medical plans. Nothing should be off the table. Can the governor handle a holistic and detailed overview of what’s on the table?
Is one-person train operation an option aside from on the L? I thought the CBTC system was the only we could do OPTO in the subway, and even the L’s CBTC system has its issues. More information on this proposal would be nice (the other proposals are more possible, though there are big barriers to those as well).
At a technical level, all that’s necessary are door controls for both sides of the train in the train operator’s position. That’s already in place systemwide, except on the C and on a few trains on the J/Z.
Some stations need to have monitors and cameras installed so the train operator will have full visibility.
As I’ve argued before, NYCT’s implementation of OPTO increases dwell times, especially at stations with the platform on the left. That slows down service and can reduce rush hour capacity. Rather than instituting systemwide OPTO overnight, it should be phased in gradually, starting with lines that don’t have major capacity constraints, perhaps starting only outside of rush hours, and expanding from there.
There are currently contractual issues holding the MTA back from implementing OPTO on trains longer than 300 feet.
There are also safety concerns, but they should be resolved by a safety expert who is willing to look at other OPTO systems around the world, not by a union with an ulterior motive.
In the DC Metro, on the left/non drivers side door controls, there is a button , I believe, called “ATC Go”, the conductor/train driver presses it after closing the doors, and the computer drives the train away. Next to the go button there is an emergency stop button, in case the operator sees someone being dragged as the train drives away. This way, no time is ever wasted by having the operator having to walk back to the driver’s position after closing the doors to get the train moving. The DC Metro is 100% OPTO, even with “8 car” NYC Subway length (600 foot, 75 foot cars) trains.
I agree current OPTO implementation is unworkable. Dwell times issues can be fixed by moving monitors inside the trains. Todays flat screen monitors are very small and you could even use OLED technology that allows the screens to curve inside the train.
The time has come and it is SAFER than looking down a crowded platform. As it is conductors on some platforms ALREADY use cameras to view parts of the platform out of sight.
The MTA’s current taxes, fee’s, tolls and fares could easily support the proper operation of the transit system if FAIR wages are paid.
NJT bus operators for there contract services make $10-$15 to drive a bus while our train cleaners make $25 an hour plus another $10-$15 an hour in benefits. THAT nearly $40 an hour for a broom sweeper. Lets multiply that out across a year. 40 hours times $40 an hour * 52 weeks = $83,000 for a broom sweeper. Union Porters(which these guys are) at Flatbush Gardens apartments make between $15-$18 an hour with less generous benefits.
If you go up and down the TWU pay lines similar shocking pay rates are there. No wonder the MTA is broke. And congestion pricing taxs will just get passed onto labor the same as the MTA bailout was.
These sky high mta, city, state and construction union costs is why it is so expensive for working class people to live in crummy area’s such as east new york. These UNION rates benefit a select few and punish the poor. The middle class just mover out where the jobs are.
I don’t support reducing pay for current employees as they bought houses, cars etc based on there current pay but work rules have to be brought in line and supervisors need to be profesionalized with clear goals and accountability
a wage freeze is certainly a step in the right direction, albeit a measly baby step in a budget deficit that needs a miracle, and the same holds for the MTA and the TWU.
Is it at all possible to cut spending on the administrative level? That might be less of a third rail, and as I understand it the MTA has a very bloated bureaucracy.
Correct me if I’m wrong, but hasn’t Walder already been doing that, I thought that was part of the “$500 million in real savings” line he throws around. Not to say the administration probably couldn’t benefit from more fat trimming, but I had thought that Walder was already looking there for savings.
Joe’s right. The MTA has already cut more than $500 million in annual administrative spending.
Retire at 100% vesting by age 50. What a joke. I don’t even think that France has it this good!
Hey, the Utopian socialists thought that by the year 2000 we would all retire at 45. Instead we’re working more and more for a smaller and smaller chunk of the pie.
I’m not saying that socialism is the answer or that public unions should get a much better deal than anyone in the private sector would be able to negotiate, but we should think some about how much we’re working and what we’re actually getting in return.
At NYCT one is vested in the NYCERS pension after 5 years service. One can retire at age 55 at 50% IF you have 25 years service. There is no medical benefit. I think french rail and transit workers have better benefits.
The pensions in my opinion is not the issues except in the area of pension padding. The issue is work rules at the MTA. The system is set up to milk as much as possible. Many do not know that besides the private operators that the mta took over from the city the mta also operated as a separate subsidiary that the mta has been wanting to integrate into NYCT for decades but the unions will not allow. All the buses are in MTA colors but the mta lacks the ability to interline buses and routes. Simply allowing the mta to integrate the old command bus depot(mta bus spring Creek) with NYCT bus operation costs the mta nearly $1 million a year in extra dead heading cost of moving buses on and off route . Moving the BM3 and BM4 to Ulmer Park would reduce deadhead times by 20 min plus per bus(40 min round trip per bus).
Bus operators working overtime are required by contract to report to their home depot and not the nearest depot that have spare buses. The work is assigned by number of years worked and results in a driver who works in the Bronx to drive 1 plus hours to brooklyn to provide subway shuttle service. Thats 2 plus hours of extra overtime that is not providing needed service but rather overtime pading
Does the SIRR need a conductor door operator on a 4 car train. NO.
Do we need station agents or station security?
There are $1 billion in labor savings that are low hanging fruits without cutting too deep into the union perks and pensions.
50% pension 25/55 is not all that generous. It is all the padding that makes the final salary $100k plus
If I remember correctly, SNCF’s employees get to retire at 55.
Right. The 2005 strike was about 20/50 instead of 25/55. It is still 25/55, but don’t rule out another strike for 20/50.
The strike was not about 20/50. The strike was a fiasco. The MTA’s last offer was better than what we settled for. We should not have gone but we should not have come back so early. We wasted our only weapon. It can’t be used again.
I think the anti-transitworker posters here grossly overestimate the power of the union. We couldn’t give back our negotiated/arbitrated raises because we all know we won’t get another one in the foreseeable future. All we can do is try to hold on to our benefits.
Cuomo can’t order a wage freeze at MTA. That has to be done via a new contract with the MTA board. A more likely labor scenario is that Cuomo raids the MTA dedicated funds via an across-the-board state budget cut and blows a giant hole in the MTA budget. This leaves Walder to figure out how to plug the gap. It’s very important to keep in mind that TWU’s contract expires in late 2011. It’s unlikely that Cuomo will support road/bridge pricing or other new revenue until that contract is resolved.
[…] Ben Kabak notes in a post today, New York City’s transit workers can’t help but get drawn into this battle. TWU Local […]
“The governor said during his campaign that the difficult financial times call for shared sacrifice.”
So, what share of the sacrifice will go to retired and soon to retire public employees, and seniors in general (ie. the generations that ran up those debts)? Note that I didn’t say future employees sacrificing in the future when they retire, I said current retirees right now.
“A quarter of the budget, $3 billion, for pensions and debt service. Lord help us.” “Debt service is almost twice as much as pensions.”
Well, don’t forget retiree health insurance. And if those still working hope to get their pensions, perhaps the share going into the pension funds ought to double. Then again, if interest rates jump up to normal levels and the MTA has to role over debt (and for the share of debt those geniuses put us into variable rate), perhaps the debt service share is going up too.
What retiree health insurance? Not at NYCT.
Then what’s this?
http://retiree.nyct.com/lev2/benefits.htm
I have heard it said by people with 25 years service who are older than or near 55 that they get no health insurance untill 65. Maybe they just like working and want an excuse….. I don’t know.
NYCT has lots of titles and lots of different pension arrangements. I don’t know if all of them include retiree health insurance, but I do know that some of them do. Perhaps your friends are among the unlucky ones.