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Transit agreement reached, no cuts to service this year


August 28, 2012

Allegheny County Executive Rich Fitzgerald, Pennsylvania Department of Transportation Secretary Barry J. Schoch, Amalgamated Transit Union (ATU) Local 85 President Steve Palonis, and Port Authority of Allegheny County CEO Steve Bland stood together last week to review details of an agreement that will prevent a 35 percent cut in transit service.

"In January, the Port Authority announced that it would have to cut service by 35 percent because of funding constraints. Such a step would have destroyed our system and impacted thousands of residents, employees and businesses in our economy," said County Executive Fitzgerald. "I am proud to stand here today with these partners and announce that because of the cooperation and commitment that the ATU, the Port Authority and the state have shown, there will be no cuts to Port Authority service in September."

The tentative transit agreement, reached on August 9, was ratified by ATU members on Sunday, Aug. 19 and by the Port Authority of Allegheny County this last week. The union commitment provides $60 million in savings to the Port Authority over four years, or an average $15 million a year. The four-year deal will expire on June 30, 2016.

The contract includes:

• Two-year wage freeze, resulting in a savings of $19.6 million;

• Increase in employee pension contributions from 5.5 percent to 10.5 percent of wages, generating $26.8 million in savings;

• Changes to vacation eligibility, providing another $11.3 million in savings;

• Additionally, the union has agreed to reopen the agreement in 2014 to modify healthcare coverage and has committed to reducing spending on healthcare by $1.8 million;

• Remaining savings of $300,000 will be achieved through the in-sourcing of certain maintenance functions at lower costs than contracting, by using existing forces and equipment.

Port Authority management also has stepped up by providing an additional $10 million in savings achieved by increasing pension contributions of non-represented employees from 4.5 percent to 10.5 percent, as well as departmental cost reductions.

"These changes not only help preserve transit service today, they are a significant step toward protecting public transportation in Allegheny County for many years. We're very thankful to the parties who have been committed to seeking a lasting solution to these issues," Mr. Bland said.

Allegheny County is also providing an additional $4.5 million in funding and is doing so without raising taxes. The executive announced $1.5 million would come from drink and car rental tax revenues, with no increase over the current rate. An application will also be submitted to the Allegheny Regional Asset District for the remainder of the funding committed by the county.

Governor Corbett has also played an integral part in this deal and the ongoing conversation related to addressing legacy costs and ensuring that this conversation is not repeated over and over again.

"Since the start of the negotiation process, Governor Corbett has supported finding a long-term solution and ratifying this contract is a winning solution for everyone – the Amalgamated Transit Union Local 85, the Port Authority and Allegheny County. But most importantly for thousands of riders who rely on transit, it means continued access to medical visits and employment in the City of Champions," said PennDOT Secretary Barry J. Schoch. "The state is also a winner as this ground-breaking contract exemplifies what the Governor was driving for – a lasting solution to the authority's growing legacy costs and recurring fiscal dilemmas."


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