VTA workers to get raises, bonus despite deficit

South Bay transit agency sidesteps contentious labor negotiations in new contract with union

After a devastating year that included cyberattacks that stranded riders and the deadliest mass shooting in Bay Area history that took the lives of nine co-workers, the Valley Transportation Authority has a plan it hopes will boost employee morale: a $3,500 “appreciation” bonus along with a 10% raise over the next three years.

The gesture from the South Bay light rail and bus operator is part of a new union contract deal designed to improve worker relations after a year of turmoil, but it also will increase labor costs by $38 million over the next three years, according to VTA estimates, and exacerbate a looming budget crisis.

On Tuesday evening, the VTA Board of Directors approved the new contract in an 11-to-1 vote with its largest union, the Amalgamated Transit Union, which represents about 1,500 employees. It is the first labor negotiation since the May 26 shooting at the Guadalupe rail yard and after an outpouring of complaints against VTA management for ignoring a toxic work culture and accusations of dysfunctional management in the lead-up to the shooting.

This smooth negotiation process saw no public mudslinging with an agreement reached months ahead of a September deadline. The process also marked a change from the previous negotiations in 2018-19 that witnessed a bitter standoff between the sides and halted new hiring for over a year.

“All of our employees, not just the drivers, have been through a hell of a lot this year,” said Stacey Hendler Ross, a VTA spokesperson. “It’s an effort to try help build employees up and show them that we understand what their value is.”

For many, the new contract is a sigh of relief. With negotiations in the rear-view, the VTA will not be locked in an acrimo

nious back-and-forth as the agency nears the one-year anniversary of the mass shooting and can look towards clawing back ridership and revamping the workplace.

“Everyone has been praising us as heroes, but they’ve been paying us zero,” said Armando Barbosa, a VTA bus driver. “It really does help being compensated for the risk that we take being out here in the community.”

For VTA critics, however, the agreement rewards an already financially bloated agency that has long suffered from low ridership, high costs, and was dubbed by a 2019 Santa Clara Civil Grand Jury report as “one of the most expensive and least efficient transit systems in the country.” Amid the downturn in ridership in 2020, the VTA subsidized each light rail passenger trip to the tune of $19.30 — an expense per rider ratio more than double BART.

Compared to other Bay Area transit operators facing an impending fiscal cliff, the VTA is in a relatively stable financial position. It is running a short-term budget surplus of $17 million, boosted by a strong recovery in sales tax funds, which is the agency’s largest source of revenue, and lower-thanexpected labor costs as the VTA scrambles to fill vacancies. But the agency is projected to run an annual deficit starting this year that will balloon to tens of millions of dollars in the coming years, with only a dwindling pot of one-time federal relief money keeping the agency afloat through 2025.

“The fundamental problem is that even in good years, we have a gaping operational deficit,” said San Jose Mayor Sam Liccardo, who sits on the VTA board and was the sole board member to vote against the contract. During the meeting on Thursday, Liccardo criticized the contract saying it is “simply burning through” the excess federal money instead of investing it in solutions to the VTA’s budget woes. “We’re not being honest with ourselves and the public about what our capacity is and what the public is willing to pay for.”

These bonuses are by no means the first public employee bonuses in the pandemic era. Santa Clara County doled out $76 million in “hero pay” to 22,000 county employees.

The tiny Contra Costa County town of Clayton is poised to award its 23 employees, including police officers and people who worked from home, $10,000 in bonuses from excess federal relief money. Meanwhile, thousands of dollars in hiring bonuses are now commonplace for transit operators looking to lure new bus drivers amid staffing shortages.

Under the contract ATU members will receive a 2% raise in March of this year, followed by 4% increases in 2023 and 2024.

The VTA also agreed to review its starting salary for bus operators and will not require increased contributions to the ATU’s $660 million pension plan, a major sticking point in the last round of contract negotiations.

According to John Courtney, the latest round of negotiations signaled a new working relationship between the union and VTA management, whose General Manager Carolyn Gonot took over in July. “The normal cycle of contract negotiations tend to be contentious — it creates a lot of angst with our riders, drivers and mechanics,” said Courtney. “Gonot was very open to putting a contract together ahead of the anniversary and the September deadline,” he said, “Her actions speak volumes.”