Metro riders could find themselves footing the bill — if not at the fare gate, then through jurisdictional subsidies.
The union for 8,000 Metro rail and bus operators and mechanics is signaling it will not seek less for its members in upcoming contract talks despite the tight budget forecast facing the D.C. region’s transit authority.
Although Metro’s operating costs are projected to increase at an unsustainable pace compared to revenues in a 10-year budget outlook released in early Sept., the president of the Amalgamated Transit Union (ATU) Local 689 is indicating she will seek substantial wage increases and push back against further concessions in employee pensions when contract negotiations begin.
The current contract, which was successfully negotiated and ratified without arbitration, expires next summer. It provided an 11 percent wage increase over the past three years, but the raise partially was offset by workers agreeing to contribute 1 percent and then 3 percent of their earnings toward their pensions.
“I don't think the employees should suffer because we need a new radio system, or because we need new [railcars] or we need new buses,” said union president Jackie Jeter, who said Metro’s eight city and county jurisdictions need to solve the perennial problem of the lack of a dedicated funding source for the operating budget.
“Wages have been flat for the last 10 years. And even though they may have gotten a wage increase three years ago, it is not the kind of wage increase they should have gotten,” Jeter said in remarks to reporters following a recent Metro board meeting.
Negotiators in a bind
When past contract negotiations failed to produce an accord, arbitrators ruled in favor of union wage demands on the reasoning that Metro could raise fares to recoup higher personnel costs. But the budget climate heading into the next fiscal year may not be as accommodating. D.C.’s members on Metro’s board of directors already are threatening to use a jurisdictional veto to block a fare hike — further complicating efforts to balance the transit authority’s budget.
Seventy percent of Metro’s projected growth in expenses is personnel costs, followed by MetroAccess operating costs (10 percent), Silver Line Phase 2 (8 percent), third-party services (5 percent), and fuel, propulsion, and utilities (4 percent).
The union’s expectations combined with resistance to fare hikes or service cuts may leave Metro’s negotiating team with even less room for maneuver.
“While we won't comment at this early stage about upcoming labor negotiations, we are very mindful of the tight budget environment, both for Metro and the jurisdictions we serve,” said a statement by Metro spokesman Dan Stessel.
Recent political turmoil on Metro’s board will not help the transit authority navigate its budget problems, according to Emil Frankel, a transportation policy expert at the Eno Center for Transportation, a D.C. research group.
“Unless there is common purpose established at the board level and, in this case, among the jurisdictions, you can’t balance these interests,” Frankel said. “That is the underlying problem, the inability to establish that common interest and even among the jurisdictions seemingly to negotiate in good faith.”
The Metro board has been internally divided over the search for a new general manager, the best use of future railcar purchases, the fate of the 5A bus route to Dulles Airport, and whether to fund a trust for post-retirement employee healthcare benefits.
Burden may fall on taxpayers
Jeter was not ready to name specific figures before contract talks begin, but said it is possible the union will ask for more than the current contract’s 11 percent wage increase.
“I think we have to look at what the trend is in the region, what the economic situation is in the region. Usually when we do this we employ an economist to work with us so that we have the best numbers,” she said.
“I will toot the horn of unions, and I will say that workers all across the United States probably need to join a union so they can the raise they are supposed to have,” Jeter added. “All workers are supposed to make a decent wage.”
More than $1 billion of Metro’s $1.8 billion operating budget is absorbed by labor costs for its 13,000 employees. The ATU Local 689 is the largest of several unions including Local 2 of the Office and Professional Employees International Union and the union for Metro Transit Police.
About half the operating budget is covered by fares, with the other half met by jurisdictional subsidies. But with ridership in a long-term decline, the revenue coming out of the fare box is not expected to increase, ramping up the pressure on local taxpayers — through the jurisdictional subsidies — to balance Metro’s operating budget.