Allegheny County Executive Dan Onorato says he is still offering up two plans to save the Port Authority of Allegheny County but the union does not seem to be interested in accepting either of them. The Port Authority implemented 15% service cuts and laid off 180 workers Sunday in an effort to balance its budget through the end of June, 2012. Onorato says a little more than a week ago he began crunching the numbers. “I had my finance department, CPA’s and accountants at the county, not the Port Authority, not the union, verify every number before I put my two options together because I did not want to be pulled in either direction or biased by either side,” says Onorato. He says his options trim $20 million from the budget annually and will deal with the cost of providing retirees with healthcare.
Both plans call for the union to forego a 3% wage increase set for January of 2012, change overtime and job bidding rules, and increase employee payments into the retirement fund. Plan One then calls for employees to increase their healthcare costs to cover 20-percent of the premiums. Plan Two, calls for all future retirees to get a maximum of three years of full health insurance benefits. Currently those benefits are available to them for life. “These are real options that deal with the legacy costs of the Port Authority,” says Onorato.
Onorato says the offers put on the table by the union last week fell short of the $20 million mark and did not deal with legacy costs. “It has to be real, it has to deal with legacy costs, it cant be a promise,” says Onorato.
There are currently 2,700 union members on the PAT payroll and 3,200 retired union members receiving pension payments and health care benefits. Onorato says that number needs to be reversed. He points to the health insurance costs associated with county and the retirees of the Southeastern Pennsylvania Transportation Authority in Philadelphia. He says PAT and the county both spend $69 million a year on healthcare and the county has more than twice as many active employees. SEPTA is three and a half time the size of PAT but is spends $8 million on post retirement healthcare while PAT spends $32 million.
Onorato says he is not suggesting that PAT enter into bankruptcy and change the benefits for current retirees because, “that is not the right way to handle this.” But he says that is where PAT is headed. As he holds up his thumb and for finger before his eyes he says, “They are this far from going over the cliff.”
Onorato says he will continue to look for ways to find more state funding but he says knowing the climate in Harrisburg he does not think there is much hope of doing that.
When asked why it was not the Port Authority Executive Director or Board President making the offer Onorato responded that they have already offered their plan, the 15% cut, and now he is offering his plan.