Port Authority fare hikes, transit service cuts on horizon
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The Port Authority's board on Friday approved a 2012-13 budget that represents a worst-case scenario crammed with bad news, but hope emerged that devastating service cuts could still be rolled back before they take effect Sept. 2.
Saving dozens of bus routes -- and the positions necessary to staff them -- would appear to require major concessions from a union whose contract expires June 30.
Both authority Chief Executive Officer Steve Bland and Steve Palonis, the incoming president of the Amalgamated Transit Union Local 85, expressed optimism that negotiations under way involving the state and Allegheny County would be fruitful.
"This still can be avoided, but time is running very short," Mr. Bland said of the reduction in service by 35 percent, which he termed "unacceptable."
Mr. Palonis acknowledged that concessions were a part of the equation.
"It's very clear," Mr. Palonis said. "We want to save the system for Allegheny County and everybody else, and our membership understands where we're at."
The authority board unanimously approved a $333 million operating budget -- 10 percent smaller than the current fiscal year's $370 million -- balanced by a July 1 fare hike, a drastic reduction in service and elimination of nearly a quarter of the work force.
Prior to the vote at the authority's Downtown headquarters, board Chairman John A. Brooks called the budget "grim."
"This is not ideal," Mr. Brooks said, "yet we are obligated to adopt a balanced budget."
To make everything add up during the current fiscal year, the Port Authority resorted to using nearly $41 million in one-time revenue and reserves.
Even more dire strategies to balance the budget for the year starting July 1 include laying off about 560 people, getting rid of 46 bus routes, reducing service on the remaining 54 bus routes and light rail transit and dropping service at 17 park-and-ride lots representing 2,800 parking spaces.
Although Mr. Bland held out hope for salvaging service in the region, he said the fare hikes -- 25 cents for Zone 1 riders and 50 cents for those in Zone 2 -- were here to stay unless a miraculous agreement were to be forged this weekend.
Mr. Palonis said any solution that allowed the authority to avoid service cuts would have to include a permanent state funding solution that restores money previously cut.
"If we're going to do long-term concessions we have to have a long-term contribution of funding," Mr. Palonis said. "There has to be dedicated funding from the governor's office. It can't be a patch."
The contribution from Harrisburg remains steady this year at almost $156 million, but it shrank by $34 million in the fiscal year ending June 2011.
Pennsylvania Department of Transportation Secretary Barry Schoch has met with Mr. Bland in the past month and is "optimistic that a shared solution can be achieved," his spokesman, Dennis Buterbaugh, said.
As has been the case for several years, so-called "legacy" costs -- the expense of health care and pensions for retirees -- stand at the heart of the authority's budget woes.
This coming fiscal year the authority projects the combined cost of retiree health care and pensions to amount to almost 22 percent of the budget, up from 18 percent last year and roughly 6 percent a decade ago. For 2012-13, the cost of health care for retirees is expected to exceed that for employees -- $33.8 million compared to $29.4 million.
There are 3,081 retirees and 2,495 employees.
Compounding the situation is what Mr. Bland called an "unprecedented" wave of retirements during the past 18 months, which saw about 135 workers depart.
The authority is short about 30 positions in its maintenance section and roughly 40 positions among its operators. All employees previously laid-off have been called back.
"So that well is now bare. That puts an enormous strain on our system and an enormous strain on those employees that remain," Mr. Bland said.
There are not many more employees on the payroll eligible for retirement, Mr. Bland said, which should stanch the stream of those trying to escape a murky future.
"The people are leaving right now because they're scared. Health care's an issue, pensions are an issue," Mr. Palonis said.
Less manpower is already having an effect seen in the occasional bus run being canceled for lack of an operator and fewer employees available to spruce up buses.
"Buses aren't necessarily being cleaned as often as they should be," Mr. Bland said.
A deal to avoid service cuts would also mean that layoffs could be avoided, Mr. Bland said. With vacant positions needing to be filled, Mr. Bland even dangled the possibility that productive negotiations could lead to hiring.
Jennifer Liptak, chief of staff for county Executive Rich Fitzgerald, described the negotiations between the authority and the transit union as positive.
"With everyone at the table and playing a part in these negotiations, we continue to be optimistic. Our early start on this process has helped a great deal and we are hopeful that we will continue to make progress towards avoiding any service cuts," she said.
In a small bit of good news, ridership was up more than 3 percent for the year to date from 2011 and May's numbers surged 13.5 percent from the same month a year earlier.
First Published June 23, 2012 12:00 am