Cuomo's Risky Deal for the MTA

Few noticed when the state-run MTA announced a labor pact with its largest workforce, the Transport Workers Union, on Martin Luther King Jr. Day. Gov. Cuomo is getting a pass here — a pass he doesn’t deserve. The riders and taxpayers who pay the bills can’t afford this strange deal, which will push critical — and unknown — costs into the future.

The biggest takeaway sounds harmless enough: Subway and bus workers will get a 2.5 percent raise right now, and another 2.5 percent raise in 13 months, followed by a $500 bonus.

That seems about right: Though the TWU calls them “inflation-busting raises,” they don’t bust inflation by much. Prices rose by 2.1 percent last year. And wages in the private sector are finally rising, too, by 2.3 percent over the past year.

The raises may be fair, but they’re not cheap: Though the MTA won’t say, they’ll likely add $100 million to the budget this year, and $200 million next year (and every year after that).

But the MTA faces a $320 million deficit in three years’ time, the year after this agreement expires. And that’s with fare hikes this year and in 2019, both to track inflation.

If the MTA is giving out raises that are higher than inflation, it will have to increase fares above inflation, too. That, or deficits will be even bigger — as will be the service cuts that go along with them.

But the real trouble lurks in two odd, new provisions of the labor agreement.

The first is called a “me-too” clause: If the separate unions at the Long Island Rail Road get raises that are higher than what the subway and bus workers just got, the MTA has to “reopen” its agreement with the subway and bus workers, presumably to offer the higher raises.

TWU workers want this provision because they make less than LIRR workers. The Empire Center notes that in 2014, the average New York City transit worker made $76,230, while the LIRR worker made $106,103.

But LIRR workers make good money for a bad reason: Federal railroad law governs them, and allows them to go on strike, just like airline workers. That means they can, as they did three years ago, threaten to hold the region hostage so they can wring higher pay. Subway and bus workers, by contrast, are forbidden by state law from striking.

Railway insiders have long wanted the feds to reform the laws that help push LIRR pay so high, so that the MTA would have more control over its own labor negotiations.

It makes no sense to attack the problem from the other direction: the MTA voluntary replicating its weaker commuter-rail negotiating position when it comes to subway workers.

Plus, as a practical matter, the LIRR only employs about 7,000 people. The subways and buses employ nearly 50,000.

It makes even less sense for union leaders who represent a relatively small workforce to set the wages for the much larger workforce.

Finally, now that the TWU workers have this provision, it will stay there and govern future contracts, too — unless the MTA “pays” something in the future to take it out.

The second odd provision is for construction work. The TWU has gotten the MTA to agree to add 100 permanent construction workers. The workers will mostly remodel worker facilities, including building bathrooms for women employees.

Better facilities are fine — but this should be bid out under a competitive contract. It may be that TWU workers can do the work faster and better than outside contractors can, but it’s irresponsible not to find out.

And because the MTA does its construction work with borrowed money, the cost of this provision won’t hit the budget now — but will hit future riders.

After that, the union got lots of miscellaneous goodies: higher pay for longtime workers, dental coverage for adult children under the age of 26, and a cut in the workday for people who maintain buses, from 8.5 hours to 8.

There’s no telling how much these provisions will cost. The MTA will have to tell us before it issues new bonds, but it’s keeping quiet for now.

And the MTA’s board isn’t interested in finding out. At Monday’s monthly committee meeting, not one board member asked about how much all this will cost.

It doesn’t seem like Cuomo was all that interested, either — or, at least, he was more interested in delaying paying up till later.

This piece originally appeared in the New York Post

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Nicole Gelinas is a senior fellow at the Manhattan Institute and contributing editor at City Journal. Follow her on Twitter here.

This piece originally appeared in New York Post