You think its bad for PAT now, it's about to get A LOT WORSE! (Penn: rain, single)

[Goinback2011]

If we weren't spending huge amounts of money on welfare programs and the military, there would BE money for infrastructure building and repair.

We could have fantastic transportation systems, but we don't and we won't because of entrenched corruption at all levels of government, and that includes PAT, where the pensioners robbed the bus company and labor union mouthpieces want the looting to go on and on and on.

[BrianTH]

There are, of course, paths forward that would allow us to redirect resources away from future health care and retirement costs and toward things like transit operations, education, and infrastructure. Again, this isn't just speculative, because countries like Finland have mapped such paths for us.

Unfortunately, some of the posters above are exemplars of why it is currently relatively hard for the United States to head down those paths. On the plus side, a combination of factors--urbanization, de-segregration of neighborhoods, demographic shifts, and so forth--are going to gradually make it easier (I would actually say it is inevitable) to follow those paths, because such people will lose their ability to block such progress.

[ML North]

Originally Posted by Goinback2011

We could have fantastic transportation systems, but we don't and we won't because of entrenched corruption at all levels of government, and that includes PAT, where the pensioners robbed the bus company and labor union mouthpieces want the looting to go on and on and on.

About 20-30 years ago as the population of Pittsburgh was decreasing, the Port Authority found itself in the position of having too many employees. PAT decided that, in order to cut costs, it would offer retirement incentives to reduce headcount. So it offered healthcare and retirement benefits to its senior employees, which at the time were not out of the ordinary or too expensive. Since then, the cost of healthcare has increased at an annual rate far greater than inflation, and that has lead to those costs becoming overly burdensome. No one saw that coming, and looking back now and saying that they should have predicted that dynamic is clearly unrealistic.

So clearly, that's neither robbery nor fraud -- inaccurate and dishonest accusations which you've repeatedly made -- but I'm sure you're not willing to accept any explanation that doesn't vilify PAT and the union.

And just as a reminder, while the particular dynamic discussed in the preceding paragraphs is a concern, it is not the principal cause of the current funding problems. And supporting the state in cutting PAT's funding has absolutely no benefit to Pittsburghers, who will continue to pay the same price for fewer services.

[GarlicBreath]

Originally Posted by Goinback2011

If we weren't spending huge amounts of money on welfare programs and the military, there would BE money for infrastructure building and repair.

Welfare and military in the same breath? Seriously?

[robrobrob]

Originally Posted by ML North

About 20-30 years ago as the population of Pittsburgh was decreasing, the Port Authority found itself in the position of having too many employees. PAT decided that, in order to cut costs, it would offer retirement incentives to reduce headcount. So it offered healthcare and retirement benefits to its senior employees, which at the time were not out of the ordinary or too expensive. Since then, the cost of healthcare has increased at an annual rate far greater than inflation, and that has lead to those costs becoming overly burdensome. No one saw that coming, and looking back now and saying that they should have predicted that dynamic is clearly unrealistic.

So clearly, that's neither robbery nor fraud -- inaccurate and dishonest accusations which you've repeatedly made -- but I'm sure you're not willing to accept any explanation that doesn't vilify PAT and the union.

And just as a reminder, while the particular dynamic discussed in the preceding paragraphs is a concern, it is not the principal cause of the current funding problems. And supporting the state in cutting PAT's funding has absolutely no benefit to Pittsburghers, who will continue to pay the same price for fewer services.

It is not like Pennsylvania is the only state making cuts. Most of the cuts are driven by two things in my opinion. The cost of health care keeps going up and even though the employees are paying more their employers (the state) are seeing their cost go up significantly. The other is that most of the state employees are getting raises. As everyone knows, it is impossible to freeze wages when their is a contract.

Interestingly, some school districts in PA have not agreed to new contracts with the teachers. Downside to the school district they are stuck with the high priced health care that is required under the last contract. Downside to the teachers. Their wages are basically frozen at the last year of the contract. Who knows who this really benefits.

[ML North]

Originally Posted by robrobrob

It is not like Pennsylvania is the only state making cuts. Most of the cuts are driven by two things in my opinion. The cost of health care keeps going up and even though the employees are paying more their employers (the state) are seeing their cost go up significantly. The other is that most of the state employees are getting raises. As everyone knows, it is impossible to freeze wages when their is a contract.

The biggie here is a reduction in state funding due to changes in how transportation is funded.

Originally Posted by ML North

PAT's 2012 budget book can be downloaded here: Port Authority - Budget & Finances

For example, from 2008 to 2011 PAT's operating revenues from ridership have increased from $70.8M to $77.2M and total revenues have increased from $88.7M to $99.1M. During that same period, PAT's expenditures on fuel, tires, and maintenance have increased from $22.9M to $24.4M. PAT's expenditures on salaries, wages, and benefits have increased from $242.8 in 2008 to $261.4M in 2011, an annualized change of 1.86%

From 2008 to 2011 state operating grants to PAT have decreased from $183M to $150M, an annualized change of -4.85%.

[UKyank]

Originally Posted by ML North

The biggie here is a reduction in state funding due to changes in how transportation is funded.

Don't leave out the fact that legacy costs have ballooned to 35%+ of PATs operating budget & will only continue to increase - there's no way to convince the state to keep funding that continually increasing gap. The Public sector should have gotten out of the defined benefit pension game a long time ago.

[ML North]

Originally Posted by UKyank

Don't leave out the fact that legacy costs have ballooned to 35%+ of PATs operating budget & will only continue to increase - there's no way to convince the state to keep funding that continually increasing gap. The Public sector should have gotten out of the defined benefit pension game a long time ago.

Obviously, cutting funding and service will only make that problem much worse. I think legacy costs are an issue that should be addressed (who doesn't?), but those problems should be addressed directly. Destroying the portion of PAT that actually is functional will not and cannot solve those problems; rather, it will just exacerbate them.

[robrobrob]

Originally Posted by ML North

The biggie here is a reduction in state funding due to changes in how transportation is funded.

Understood, but my point was more of a general point that it costs the state more to employ state workers (wages increasing and health care cost going up) which in turn affects the amount of money that they can dish out.

I was merely trying to point out that Pennsylvania isn't the only state that is trying make cuts.

[BrianTH]

Originally Posted by UKyank

Don't leave out the fact that legacy costs have ballooned

I believe that was included in the labor cost component of the comparison.

Of course as we have discussed many times above, if you are looking at legacy costs as a percentage of PAT's operating budget, whenever the state cuts PAT's operating funding, it automatically increases that percentage.

Which is a nifty trick--cut PAT's operating funding, cite increasing legacy costs as a percentage of PAT's operating budget as a reason to further cut their operating funding, lather, rinse, repeat until PAT no longer provides any service at all.

The Public sector should have gotten out of the defined benefit pension game a long time ago.

As an aside, the defined contribution system in the United States is also a complete disaster. We need a comprehensive overhaul of how retirements are funded, both in the public and private sectors.