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Capital Metro seeks bids for labor contract to replace StarTran

Tuesday, August 23, 2011 by Kimberly Reeves

Capital Metro’s board of directors showed its cards on Monday, revealing exactly where they intend to draw the line with Amalgamated Transit Union 1091 as the board sends its major labor contract out for bid at the end of this month.


The decision, announced by Chair Mike Martinez, signals the beginning of the end to an ongoing eight-year skirmish between agency and labor that has often manifested itself in pairs: two strikes; two major agency audits; and at least two pieces of legislation passed in an attempt to fix internal agency problems.


The latest bill, Senate Bill 650, directed the agency to dissolve StarTran, its non-profit and often dysfunctional labor arm, and either move its biggest outside labor contract in-house as direct employees of Capital Metro or send that contract out for bid for a potential private vendor.


Members of the local union unanimously rejected the former as a negation of their collective bargaining rights and are likely to balk at the choice of the latter, although ATU 1091 President Jay Wyatt was not at Monday’s meeting and did not return calls or an email asking for comment on the decision.


Capital Metro, as Martinez discussed yesterday, has decided to send its biggest labor contract out for bid. As the most recent Sunset review of the agency notes, this contract is not a small one. Labor once managed by StarTran, to provide the bulk of regular bus line and paratransit service for Capital Metro engaged more than 900 employees and was worth at least $80 million.


Martinez and his colleagues set a baseline for negotiations: every employee was guaranteed a job with the new contractor; all would be hired at their current wages; health care coverage would be equivalent to current coverage; accrued pension benefits would be honored; and ATU 1091 would be recognized as the negotiating agent of the labor union.


Martinez, a member of the Austin City Council, is a former president of the Austin Firefighters Association, so any charge of anti-union bias seems unlikely to stick.


“As we are moving towards this, there will be some who will be accusing the agency and/or this board of not keeping its promises,” Martinez said. “That simply isn’t the truth. We have always maintained we would abide by, specifically, the requirements of 13c, and we’re going to continue doing that moving forward, with ATU 1091 in these meetings.”


The shorthand for “13c” is what the agency owes to current employees. As outlined by Martinez, the agency has agreed to honor current salaries and benefits, but it will not guarantee current salary structures, health insurance contributions or the current retirement plan, which is now being shifted, rather significantly, from a defined benefit to a defined contribution plan.


The original authority to outsource the StarTran contract was expected to save the transit agency about $18 million a year. Martinez acknowledged that the savings likely would be less significant, based on the terms set out in the health care and retirement plans. Those terms, and a new salary schedule would be negotiated between the private provider and ATU 1091.

As Martinez noted, Cap Metro may stipulate a certain level of coverage, but it won’t get into aspects of the health care plan such as co-payments or employee costs. In the same measure, a define contribution plan for retirement – rather than a defined benefit plan – could provide some long-term savings, he said.


Martinez and the Cap Metro board are asking, given the agency’s concessions, which ATU 1091 hold off on protesting the transit agency’s federal grant applications. Wyatt, however, has threatened just that as recently as a month ago, so it’s uncertain whether the agency might face a rocky road as it seeks federal support for various infrastructure projects.


“Any significant delays in Cap Metro’s federal funding could mean transit services cut and subsequent job losses,” Martinez warned.


The goal would be to make the transition from StarTran to a private provider as smooth as possible, Martinez said. He did agree, in an exchange with the media, that there still remained a “fundamental difference” in how the agency and the union were interpreting Cap Metro’s obligations.


With no flexibility in pay or health care, as the union suggested, Capital Metro would be stuck with limited or no savings under a new agreement.


The Capital Metro board of directors meets to consider a request for proposals on Aug. 29.

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