When the MTA adopted a proposal, nearly five years ago, to shore up their finances by, in part, raising fares every two years, the plan of attack involved biennial increases of around 7-8 percent. The rate of these fare hikes outpaced inflation but was designed to overcompensate for years of fare policies that didn’t align with inflation. After a fare hike last year, though, Tom Prendergast announced that the 2015 hike would be only four percent, and I wondered if the MTA had jumped the gun.
At the time, the MTA had still been pressing for a net-zero labor increase, and it wasn’t clear how strong the MTA’s finances would be, even in the face of an improving economy. Now, we’ve been led to believe that the MTA can afford something more than net zero without rigid work rule reform, at least for the TWU, and the Long Island labor dispute has become the center piece of the battle over MTA dollars. Last week, it seemed as though a summer strike would be more likely than not, and the question on everyone’s mind concerns the money. While the Presidential Emergency Board again failed to account for the MTA’s razor-thin margins and lack of financial flexibility, the PEB still awarded the LIRR union 18 percent raises. Where would this money come from?
In a piece last week in the Daily News, Pete Donohue attempted to answer. For starters, Prendergast said at least week’s MTA board meetings, the fare hikes won’t be increased, but what about everything else? Donohue summarized:
Prendergast said that if an agreement calling for 17% raises for LIRR workers were reached, there would be an impact on MTA budget models, but members of the authority’s board still want to limit next year’s fare hike to 4%, as previously planned. “Fares we’re pretty firm on,” Prendergast said after an MTA board meeting on Wednesday.
MTA officials will meet with LIRR union leaders and attempt to negotiate a less expensive contract, Prendergast said. LIRR workers have been without a contract for more than three years. Union leaders have said they will call a strike if they don’t have a deal by the July deadline. Federal law permits strikes by commuter railroad workers after a multi-stage process of independent mediation and cooling-off periods.
Prendergast said “we’ll have to see” if the MTA would be able to afford service improvements if its budget plans had to be adjusted to accommodate LIRR raises in line with the mediation panel’s non-binding recommendation. Top transit officials last week had begun discussing implementing a package of service increases and improvements that could total $20 million, the Daily News reported.
If the MTA has to dole out more dollars than it anticipated to the LIRR union, the riders wouldn’t see planned service increases, but more alarming are the unsaid sources of revenue. The MTA would possibly have to figure out a way to use pay-as-you-go capital funding to cover labor wages for a union in bad need of reform. Such a move would leave fewer dollars for emergency repairs, component upgrades and maintenance and upkeep efforts. Clearly, that’s not a positive.
I don’t know what will happen. No one wants a strike, but as I said last week, there are some long-term gains to be had from a strike. Still, it’s important to remember that the MTA’s finances are better but still on shaky grounds, and the most vulnerable monies are the ones the agency needs the most. Instead, those dollars could go to the UTU as the city’s transit system faces a potential capital crisis.