Metro’s un­funded union li­a­bil­ity will even­tu­ally dis­ap­pear

The Washington Post - - WASHINGTON FORUM -

Re­gard­ing Robert McCart­ney’s April 17 Re­gional Memo, “To res­cue Metro, all par­ties need to give some” [Metro]:

The Tran­sit Em­ploy­ees’ Re­tire­ment Plan has an un­funded li­a­bil­ity of ap­prox­i­mately $800 mil­lion, not $3 bil­lion. The larger num­ber refers to the to­tal un­funded li­a­bil­ity of all of Metro’s re­tire­ment ben­e­fits, in­clud­ing health in­sur­ance and man­age­ment pen­sions. In 2009, an ar­bi­tra­tor elim­i­nated re­tire­ment health ben­e­fits for em­ploy­ees hired af­ter Jan. 1, 2010. This un­funded li­a­bil­ity will shrink and even­tu­ally dis­ap­pear.

The un­funded TERP li­a­bil­ity is mainly a re­sult of the Wash­ing­ton Met­ro­pol­i­tan Area Tran­sit Author­ity’s pen­sion hol­i­day from 1997 to 2006, dur­ing which it con­trib­uted noth­ing to the TERP.

Amal­ga­mated Tran­sit Union Lo­cal 689 mem­bers con­trib­uted to the TERP since it was cre­ated in 1945. In 1983, the union and man­age­ment agreed that if the union gave up a 6.5 per­cent wage in­crease, WMATA would use that money to fund the plan. In 2004, to get WMATA to end its pen­sion hol­i­day, the union agreed to take a 1.5 per­cent pay raise in­stead of a 3 per­cent hike to in­crease pen­sion fund­ing.

On the is­sue of con­tract ar­bi­tra­tion, there has been only one full con­tract ar­bi­trated since 1980 — in 2008. The others were re­solved through col­lec­tive bar­gain­ing. The 2009 ar­bi­tra­tion that led to the elim­i­na­tion of re­tiree health in­sur­ance will even­tu­ally save Metro more than $1 bil­lion. It is hard to ar­gue that this hurt Metro’s fi­nances.

Mike Go­lash, Wash­ing­ton The writer is a former pres­i­dent of Amal­ga­mated Tran­sit Union Lo­cal 689.

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