Stung by deficit, SEPTA reveals strategic plan

The agency faces a possible strike if it fails to reach an agreement with its labor union. Responding to a recent decline in ridership, a $150 million operating deficit and a possible strike by an irate union, the Southeastern Pennsylvania Transportation Authority recently announced a five-year strategic plan to revamp the nation's fifth largest public-transportation system. The plan includes proposals for automated fare collection, station renovations, new buses and subway cars and secured waiting areas. It also aims to improve relations with the Transportation Workers Union Local 234, which represents 5,600 SEPTA employees. Negotiations between the two parties have been far from smooth. Although neither side wants to see a strike, union workers reacted angrily to a proposed contract, which they claim gives the management too much power. With an existing 1995 contract set to expire on March 15, SEPTA officials gave the union a copy of the proposed 85-page contract last month. At the same time, the union presented SEPTA with a 15-page list of contract proposals, which included changing the company's pension system to allow employees to retire earlier. "SEPTA is in trouble -- this is no joke," David Cohen, SEPTA's chief negotiator, said Wednesday at a luncheon at SEPTA headquarters. "Change is essential for the benefit of SEPTA's riders." SEPTA lost 21 percent of its riders between 1988 and 1997, a loss which cost the authority roughly $74 million per year in lost income. The plan has been in development for the past eight months, as SEPTA officials have been trying to modernize the public transit system and improve their relationship with the union, according to General Manager Jack Leary. But the union criticized Leary's management and the new five-year plan as "rhetoric, with little substance," according to TWU spokesperson Bruce Bodner. Leary said the authority is trying to end the negotiations without a strike. "A strike would be devastating to our objective," he added. But Bodner said SEPTA is trying to paint the union as the culprit in any potential strike. "SEPTA is doing a heavy publicity campaign, we believe, to demonize our members," he said. "SEPTA has a desire to subcontract and privatize our work without justification or a right to do it, all at the expense of the customers." SEPTA's new plan, according to Cohen, will restructure the system and "adopt as a central philosophic premise the needs for a true partnership between management and labor." Cohen identified archaic work rules, expensive health insurance, some workers' abuse of their compensation benefits, costly benefits, the unclear role of SEPTA management, and the absence of a zero-tolerance policy for drug and alcohol abusers as key problems facing the company. "In the current contract there are dozens of past practices that make it very difficult to operate the system," Cohen said, noting the current contract's clause which allows workers to receive full-time wages even if they only work part-time days, a costly practice for SEPTA. A critical element of the new plan is the need to balance the budget throughout the next five fiscal years, since SEPTA's current accumulated deficit is around $150 million. By fiscal year 2003, the accumulated operating deficit is projected to grow to $350 million. But union officials characterized SEPTA's deficit projections as "bogus." According to Bodner, the state legislature granted $92 million to SEPTA this past spring, and let them use a significant amount of the money for operating costs. But he said SEPTA is not accounting for these funds in its deficit projections. "SEPTA is not accounting for this $92 million -- so where is the deficit coming from?" he asked. Bodner blasted Leary's management and stressed that if former General Manager Lou Gambaccini were still at the helm, "none of this would be happening." "What's producing this conflict right now is not a change in the union's part, but a change in SEPTA's top management who wants to undo all sorts of negotiations made in the last 10 years," Bodner said.

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