Wagner calls for state nominees on transit agency board
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State Auditor General Jack Wagner yesterday called for restructuring the board of the financially troubled Port Authority of Allegheny County, saying that state officials should appoint some members.
"As an elected official and a resident of Allegheny County I'm appalled that the Port Authority has operated without good management decisions. It has to stop now," Mr. Wagner said at a news conference in the State Office Building, Downtown.
Because state government provides so much operating revenue to the authority -- about 60 percent -- it needs to be represented on the board, he said.
Under his plan, the nine-member board would be made up of two appointees by the governor; one each by the president pro tem of the Senate and the speaker of the House; and five by the Allegheny County chief executive, including two at-large and one each from Allegheny County Council, Downtown businesses, and riders with disabilities.
Currently the county chief executive appoints all members with the approval of County Council.
Mr. Wagner's comments, and his revelations of lavish financial perks for top authority executives that "are far worse than what everyone thought," came on the eve of today's disclosure by the authority of how the bus-trolley system will be restructured to address a projected $80 million budget deficit in the 2007-08 fiscal year.
Riders will learn today how they could be affected by unprecedented service cuts and other changes. The cuts are expected to be the biggest in the agency's 43-year history.
Mr. Wagner said yesterday his auditors continue to find disturbing management practices from a "culture past and present" that have contributed to the agency's fiscal woes.
He revealed that former authority Chief Executive Officer Paul Skoutelas was reimbursed by the authority for buying nearly 21 years of service time from other public agencies in New Jersey, Florida and Bucks County to roll them into the authority's more lucrative pension plan. The total paid by taxpayers and riders, Mr. Wagner said, was $306,746.
Mr. Skoutelas, who worked at the authority for 18 years, receives an annual pension of $108,798 a year until 2014 and then $102,798 every year for life after that. Moreover, he said, Mr. Skoutelas received more than $30,000 in compensation beyond his salary for every year from 1997 to 2005, at a cost to taxpayers and riders of $270,000, and received a payout of $106,202 for unused vacation time.
In the past three years, he noted, $336,027 was paid to nonunion employees and top executives for unused vacation. And, Mr. Wagner said, because there is no policy for moving expenses, current CEO Steve Bland received $45,000 and another executive received $35,000.
In a prepared statement, Mr. Bland noted that many of the policies Mr. Wagner criticized -- such as the buyback of prior public service, deferred compensation and payouts for unused vacation time -- were approved by previous boards.
"The current Port Authority Board of Directors, as announced 17 days ago, is expected to take action this month to abolish such 'buybacks' and vacation time payouts, accelerate the departure of remaining [Deferred Retirement Option Program] employees and reduce future pension costs."
As for the relocation allowances, he called them "standard negotiating tools when recruiting candidates for highly specialized positions."
Board committees today are expected to endorse reforms recommended by Mr. Bland that include consolidating departments, ending generous pension and health care benefits for nonunion and management personnel, freezing salaries, eliminating 56 office positions and possibly moving the headquarters back to Manchester from Downtown.
Mr. Bland has given up his authority-owned car and a deferred compensation package and is sacrificing the same early retirement and health care benefits and salary increases as other management employees.
Mr. Wagner said much more needs to be done.
"We see indications of change but not the kind of changes which are necessary," he said.
First Published March 23, 2007 12:00 am
