No More Lip Service
Let's Take Real Cost-Cutting Measures at TriMet
By Jonathan Hunt, President

As we have seen and heard for the past couple years now, TriMet has claimed financial impairment. Even though TriMet’s ridership has increased significantly by recent reports, TriMet’s General Manager Neil McFarlane recently made a plea to the public, asking for ideas and suggestions as to how TriMet can save taxpayer dollars. TriMet claims it is facing a 2013 budget shortfall of 12 to 17 million dollars. One thing TriMet and General Manager McFarlane didn’t tell the public, is that they could save multi-millions of taxpayer dollars annually, right now, on their own.

How? By TriMet ending expensive private contracts and operating elderly and disabled transportation services in-house. TriMet currently spends around 30 million dollars annually on private contractors to provide paratransit services throughout TriMet’s tri-county area of operation. An independent audit was completed on February 20, 2008, and was based on 2004/05 fiscal year, estimated an immediate, annual savings of over 3.6 million dollars if TriMet did away with contractors and operated the service directly.

Here is what happened! For many years, the Union had challenged TriMet about how much it spent on private contractors to operate elderly and disabled transportation services. TriMet claimed it was cheaper to contract out for service, while the Union maintained it was more costly to provide the service through contractors, than it would be if TriMet operated the service itself.

Finally, the Union was successful in negotiating a provision into their 1998 collective bargaining agreement with TriMet, to jointly select an outside audit firm to conduct a thorough analysis of the cost to continue to subcontract paratransit services versus the cost to perform the service in-house. The parties further agreed that the Union and TriMet will jointly instruct and receive information from the audit firm selected to perform the analysis.

The Union and TriMet agreed on an auditor, who after having difficulty obtaining information from TriMet, quit. When the Union pressed TriMet to hire another audit firm, TriMet had second thoughts about what the audit might reveal, and refused to select an auditor. After several years; a grievance, unfair labor practice complaint and arbitration, TriMet was ordered to comply with the agreement and move forward with the audit. Finally, on February 20, 2008, the firm of Lauka & Associates, certified public accountants, issued its audit report and findings: Lift Audit Report.TriMet did not like what the audit revealed. Based on 2004/05 fiscal year numbers, the most recent full year budget figures provided by TriMet, the audit revealed that TriMet would save over 3.6 annually, if they brought paratransit service in-house. The savings today, seven years later, would be even greater.

Computing the current estimated savings based on TriMet 2004/05 budget numbers, by applying the same contract increases given by TriMet to contractors over the last six years, would save taxpayers over 7 million dollars a year if elderly and disabled transportation services were operated in-house by TriMet.

TriMet cannot dispute the Lauka & Associates report in 2008 since it was based on information they, TriMet provided. Should TriMet dispute the current projected savings of over 7 million dollars, the solution is easy. Provide the audit firm with updated budget information, and since the audit model has already been created, current savings will be easy to calculate and give taxpayers.

Another reason for TriMet to bring its paratransit operations in-house, is the imminent strikes pending with its private contractors in Multnomah and Washington Counties. Since TriMet General Manager McFarlane has refused to compel the provider, First Transit, Inc, a foreign multi-national company from Scotland, to arbitrate the current contract disputes with the Union as required by Section 13(c), work stoppages are likely. By bringing the paratransit service operation in-house, employees would be subject to the Oregon Public Employee Act (like TriMet employees) and prohibited from striking. Preventing disruption of service and keeping money in the local economy; now that is a novel idea.

TriMet recently produced a flyer and directed First Transit to require its employees to hand out to customers on their bus. In the flyer, TriMet warns of future Lift fare increases, implying that future increases were due to union contracts. Those increases would not be necessary if TriMet cut out the middle man. It is time for TriMet to stop paying “lip service” to cutting costs and saving taxpayer money. It is time to bring the elderly and disabled transportation service in-house, and keep the money in our community. Bringing the service in-house now, would make up nearly two thirds of the budget shortfall TriMet claims it is currently facing. It is time to tell the contractor, the jig is up!

For more information, go to www.atu757.org and follow us on Facebook at AmalgamatedTransitPdx.

To obtain a copy of the study, follow this link.