You think its bad for PAT now, it's about to get A LOT WORSE! (Pittsburgh: theater, garden)

[UKyank]

Originally Posted by squarian

Just a footnote, but as someone who has used the expression "death spiral" in this thread, I wonder if you aren't misremembering: I used it in connection with PAT after these cuts, not the city as a whole.

(speaking only for myself, and perhaps my use wasn't what you had in mind, in which case, forget I mentioned it.)

No, not you - those that are talking about the city as a whole

Originally Posted by BrianTH

Let's be clear--the union can't agree to cut the benefits of existing retirees. Those are protected by state law as much against the union as against PAT.

PAT's CEO seems to be misinformed that the union can agree to such cuts in benefits to existing retirees (or the article is poorly worded): Port Authority Looks To Reign In Legacy Costs « CBS Pittsburgh

the Port Authority is asking the union for its deepest concessions ever – in order to reign in so-called legacy costs, which are benefits paid to the authority’s retired workers.
Every time you feed the fare box on a Port Authority bus, you’re paying employees who are no longer there – retirees who receive pensions and health care benefit for life.
Port Authority executive director Steve Bland says funding these so-called legacy costs are crippling the system.
“There are other costs but this is the 800 pound gorilla in the room,” said Bland.
Port Authority has more retired employees than active ones – that’s 2,500 current employees compared to 3,300 retired workers. Each is guaranteed health care for life – a bill that comes to $34 million a year.
Bland says the authority needs to show Harrisburg it can rein in those costs, and then ask the state for more revenue.

[BrianTH]

Originally Posted by UKyank

PAT's CEO seems to be misinformed that the union can agree to such cuts in benefits to existing retirees (or the article is poorly worded).

I think it is safe to assume Bland means what I noted before: the union can agree to cut retirement benefits for current workers going forward, which it has done in the past.

Otherwise PAT has been clear on this issue:

http://www.portauthority.org/paac/po...an2011FAQs.pdf

Q. Isn’t this really a problem with Port Authority’s legacy costs, labor expenses, etc.?

A. Without doubt, “legacy costs” remain a huge burden to the Port Authority – one that no other transit system in the Commonwealth faces. Despite unprecedented gains in bargaining, and radical restructuring of non-represented employee benefits, Port Authority’s post-retirement benefits (particularly healthcare) remain a tremendous millstone around the neck of the organization. Unfortunately, State law prohibits any further restructuring of pension and healthcare benefits for current retirees, who account for nearly 50% of Port Authority’s healthcare costs.

Edit:

Note too what Bland actually proposed in that article:

To avoid that, the Port Authority says it’s floated a new proposal to the union – a wage freeze and the total elimination of post-retirement health care for active employees.

Why, it is almost as if you'd have to willfully misread that article to claim Bland was suggesting cutting benefits for existing retirees, say to try to establish a condition for the state restoring its promised funding to PAT that would be impossible for PAT to achieve.

[BrianTH]

This is also a useful document, particularly pp28-29, which lays out how the concessions in the last CBA cut PAT's costs for "Other Post Employment Benefits" (basically healthcare costs), even though it didn't cut its healthcare expenditures for existing retirees (which continue to grow). To summarize, it was able to do that in the last contract by getting the union to agree to cut future retirement benefits and increase the contribution from current employees to help fund those benefits, which means PAT now has to set aside less itself to fund those benefits:

http://www.portauthority.org/paac/po...esentation.pdf

That's helpful--it is saving PAT on the order of $25M a year--even though it doesn't involve cutting the benefits for existing retirees which state law protects. And I believe that is what Bland is referring to, and I expect he will get more concessions along those lines.

[eschaton]

BrianTH -

That's interesting that state law prohibits any further erosion of retiree health care. Generally speaking, in both the private and the public sector, while pensioners are always protected insofar as their monthly payments, retiree health insurance is generally not protected, either in the private sector or in the public sector in most states.

As an aside, people should realize even if the state law was changed to allow for a lowering of pension payments to retirees, the effect would be minimal except on really high-end pensions, and the state would have to pony up huge money regardless.

After all, when a private company does away with its pension by handing it over to PBGC, retirees are covered the full value of their pensions up to $54,000 annually - which is a level the vast majority of private-sector pensions fall under. The PBGC is nominally self-funded through premium payments private pensions need to make, although in practice it required a bailout late last decade.

Regardless, I highly doubt legislators could get away with a benefit cap much lower than the PBGC one, meaning except for former PAT executives, virtually everyone would see their benefits not reduced. In practice, there would be little difference in terms of cost between a totally frozen pension with a state bailout, and a PBGC-like takeover of the accounts by the state. The only thing you could say in its favor is the state may manage its assets better than PAT has, allowing for a better rate of return.

[UKyank]

Originally Posted by BrianTH

Why, it is almost as if you'd have to willfully misread that article to claim Bland was suggesting cutting benefits for existing retirees,.

actually it's very clear that he is talking about the costs of current retirees in the article not future yet to be realized costs.

Regardless this topic is played out & clear that only a few people care all that much what happens one way or another & we'll see which way the tide turns come September.

[Blackbeauty212]

Originally Posted by UKyank

actually it's very clear that he is talking about the costs of current retirees in the article not future yet to be realized costs.

Regardless this topic is played out & clear that only a few people care all that much what happens one way or another & we'll see which way the tide turns come September.

Yea because CD's Pittsburgh forum is a true barometer to the entire 1.3 million population of Allegheny County view of Public Transit's "worthyness"........most on here that detest Public Transit and PAT dont live or work in Allegheny County and damn sure not Downtown or Oakland..

[BrianTH]

Originally Posted by UKyank

actually it's very clear that he is talking about the costs of current retirees in the article not future yet to be realized costs.

Again:

Port Authority says it’s floated a new proposal to the union – a wage freeze and the total elimination of post-retirement health care for active employees.

I could understand someone initially being confused about the fact that PAT can cut its benefit costs today by cutting post-retirement benefits for future retirees, but that confusion should be eliminated once you realize that PAT has to set aside funding today for those future benefits.

So once that connection between future benefits and present costs has been explained, there is really no excuse left for willfully misreading what Bland is proposing. Unless, of course, your goal is to create impossible conditions so that PAT's management will necessarily fail to satisfy your conditions.

[BrianTH]

Originally Posted by Blackbeauty212

Yea because CD's Pittsburgh forum is a true barometer to the entire 1.3 million population of Allegheny County view of Public Transit's "worthyness".

I agree it is silly to treat participation in this thread as equivalent to a scientific poll of the entire County. However, I'd also suggest it isn't even a scientific poll of the people reading City Data PGH, and in fact I would bet dollars to donuts there are many people who read this forum and who care about transit issues and don't want to see transit destroyed, but have no interest in trying to argue about it in this thread.

[LIRefugee]

Originally Posted by BrianTH

Good, for the most part. That attitude is literally dying out, and while it will take a while yet for it to become politically irrelevant in Pennsylvania, you will fit right in when it does.

I think you're more optimistic than I am, but hopefully, in time, elected leaders will be more interested in pragmatic leadership than they seem to be now. Hopefully mass transit will be able to eke by until that happens.

[UKyank]

Originally Posted by Blackbeauty212

Yea because CD's Pittsburgh forum is a true barometer to the entire 1.3 million population of Allegheny County view of Public Transit's "worthyness"........most on here that detest Public Transit and PAT dont live or work in Allegheny County and damn sure not Downtown or Oakland..

If scientific poll on people's opinions is the bar then I guess we have no idea what anyone's opinion outside of what's been stated here is thus either way it's pointless to keep discussing the matter as things will pan out one way or another come September regardless of how either of us feels about the pat situation & I'm happy to see the thread die away until action one way or another is taken at the state level.