Judge Grants Transit Workers' 11.3% Raises, Despite MTA Financial Woes

NY Daily News - December 13, 2009

by Pete Donohue

Make way for the gravy train.

A Supreme Court judge upheld a controversial transit workers contract granting 11.3% raises over three years, rejecting pleas from the financially troubled MTA that it can't afford the pay hikes.

The Metropolitan Transportation Authority had urged Manhattan Supreme Court Justice Peter Sherwood to toss the contract, contending the arbitration panel that drafted it had made legal and factual errors in fashioning it earlier this year.

Sherwood's decision was released Friday, a day before the Daily News reported the MTA is considering ending a program providing free or discounted MetroCards to about 555,000 students.

Sherwood said the panel gave a sufficiently plausible and rational justification for the package the MTA says will boost expenses in its approximately $11 billion budget by about $100 million next year, and approximately $200 million the following year.

"In the current economic environment, the award . . . is a rich package but it is not unique," Sherwood wrote.

The judge said there was nothing unusual or wrong with the paneldeciding the transit workers deserved the raises in part because other public workers have received such increases in multiyear deals between municipal unions and the Bloomberg administration.

Police officers, firefighters, sanitation workers and other city employees received annual 4% raises in those contracts, some of which extend into 2012.

Mayor Bloomberg said the comparison is incorrect. "Arbitration is based on ability to pay, and MTA resources are not the same as city resources. The revenue shortfall and new state cuts only make the MTA's inability to afford this more apparent," said spokesman Marc LaVorgna.

The union was elated.

"The MTA has had their day in court and the judge ruled against them," said John Samuelsen, president-elect of Transport Workers Union Local 100. "Now it's time for them to stop wasting more of the taxpayers' hard-earned dollars on lawyers' fees and honor our lawfully obtained contract. I cannot think of a better way for the MTA to start this new labor/management relationship off on the right foot then to release our wage increases."

The MTA released a statement suggesting it wouldn't appeal.

"We are extremely disappointed by this decision, which will force the MTA to pay wage increases that are inconsistent with the economic crisis in New York," the release states. "The ruling will have severe financial impacts on the MTA budget, coming on the heels of a state budget cut and reduction in payroll tax proceeds."

The contract was drafted before this latest financial crisis erupted, and Sherwood was limited to reviewing testimony presented to the panel earlier this year.

The MTA is suddenly grappling with an unexpected budget gap because the state this month cut $143 million in funds and payroll tax revenues for mass transit are coming in about $200 million below the state's forecast.

The Daily News reported Saturday that the MTA is considering ending a program providing free or discounted MetroCards to about 555,000 school students. The city and state haven't fully funded the program for years.

Management and the union formed the panel in January after failing to reach a deal through negotiations. It held hearings in April and June, releasing the contract in August.

With Celeste Katz