By Richard Wronski and Jon Hilkevitch
7:34 PM EDT, May 30, 2012
After months warning of fare hikes and service cuts unless labor unions came up with $80 million worth of concessions by July 1, CTA President Forrest Claypool today called off the threats, saying the agency has suddenly come up with the money, primarily through cost savings.
Not only does finding the new money lift the burden on the CTA from the transit-riding public, but it also relieves pressure from the Regional Transportation Authority, which has been pushing Claypool to repair an unbalanced 2012 budget.
The RTA says it will need another month to review Claypool’s plan before declaring an all-clear, however. But officials said they were pleased with the CTA’s “progress.”
“We’re doing everything we can to protect our riders, doing everything we can to reform the system, to cut costs, to be more efficient and to work with our labor partners … with the goal of removing pressure on fares and avoiding the types of devastating service cuts and layoffs that we saw just two years ago,” Claypool said.
Claypool told the RTA board that the CTA has identified $57 million in 2012 expense reductions, most of them – about $44 million – in labor savings. The rest come from lower costs for materials, fuel and fewer injuries from workers.
The CTA is also seeing an extra $5 million coming from an increase in ridership.
Finally, the RTA is expected to turn over $17.9 million in additional sales tax money to the CTA.
This money comes from higher than anticipated sales tax revenue for the final quarter of 2011, the RTA said.
Claypool called these “one-time savings” that will not be available in 2013. Now it’s necessary to complete negotiations with the CTA’s labor unions, he said.
“We bought ourselves some time,” Claypool said. “(But) all the tricks in the trick bag are gone.”
When the CTA board approved the agency’s $1.24 billion 2012 budget last November, Claypool pledged to avoid higher fares and less service by wringing $80 million worth of transit union concessions in the second half of this year, and another $160 million in 2013.
The top official representing CTA bus drivers said today he wasn’t surprised that Claypool was able to suddenly come up with $80 million in cuts without the union concessions he previously demanded.
“I have learned not to be surprised about the CTA. Just look at the history,’’ said Javier Perez, a vice president of the Amalgamated Transit Union who is serving as the trustee of the international union’s Local 241, which represents about 5,500 CTA bus operators and bus mechanics. The international union took over control of the local last September because of financial and management problems.
Perez said ongoing negotiations with the CTA on a new contract are going “not as quick as I would like.’’ He added, “I don’t know that (Claypool) is still not counting on union give-backs.’’
The current union contract expired in December and its terms are being extended until a new agreement is reached.
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