LOS ANGELES — California was not the only target of a transit union’s efforts to exempt transportation employees from state pension reform efforts.
So far, California is the only state to resist the effort to exempt transit employees, which is backed by the federal Department of Labor.
The Amalgamated Transit Union was successful in gaining transit worker exemptions to pension reform laws in Wisconsin, Minnesota, New Jersey and Massachusetts, according to David Roscow, a spokesperson for the national transit union.
U.S. Department of Labor officials want California to exempt transportation employees from the California Public Employees’ Pension Reform Act of 2013, saying it violates a 1964 federal law that protects the collective bargaining rights of public transportation employees.
U.S. Labor Secretary Thomas E. Perez has threatened the state’s local transportation authorities with the loss of $1.6 billion of federal funds in 2013 alone if the state doesn’t act.
That prompted state Assemblyman Luis Alejo, D-Salinas, to introduce Assembly Bill 160, which would exempt the transit agencies targeted by the Department of Labor.
The bill is currently sitting in committee, but officials with the state’s transit agencies are hoping that the bill will pass before the legislature recesses for the year in mid-September.
Using different methods, transit workers in four other states were granted exemptions similar to what the Labor department is been urging California state officials to provide.
According to ATU, here’s what happened in the four other states that had challenges from the transit union: in Wisconsin, legislation was passed to amend state statues to the ATU’s satisfaction; Minnesota transit agencies secured and exercised exemption options to provide the necessary offsets; the New Jersey attorney general ruled that the law didn’t apply to transit workers; and in Massachusetts, legislation was passed to exempt transit workers from the law.
“ATU supports the position of the Department of Labor in urging the Governor and the California Legislature to pass legislation to address this issue. We support exempting public transit agencies and their employees from PEPRA,” Roscow said.
The union wants to preserve collective bargaining rights of transit employees consistent with DOL decisions in similar cases over the last 25 years, Roscow said.
“We clearly recognize the importance of continued funding and service, and hope Governor (Jerry) Brown would act expeditiously to solve this matter,” he said.
The state pension legislation’s provisions, which apply only to people hired in 2013 and later, include a new maximum benefit, a lower-cost pension formula with requirements to work longer in order to reach full retirement age, and a cap on the amount used to calculate a pension.
As a result of the challenge to California’s pension reform law, federal transportation grants to the state’s transit authorities has been held up since December, according to transit officials.
A Department of Labor spokesman said in an email response that their department is working closely with the governor’s office to resolve the issues involved in certifying federal grants to California’s transit districts. While those efforts continue they will hold off on making any decisions about individual grants, he said.
Los Angeles County Metropolitan Transportation Authority officials are working with federal officials and hope to resolve the issue so that decertification does not occur, said Marc Littman, an L.A. Metro spokesman.
“Decertification is a process that takes time and, as our capital planning staff explained to me, it would not be a blanket decertification of the agency,” Littman said.
It would apply to grants the unions have challenged and right now that is five grants, Littman said.
“But we haven’t received any federal funds since last December and that’s not likely to change until the issue is resolved,” he said.
He added that “hopefully, that will happen before the California Legislature adjourns either Sept. 12 or 13.”
The loss of the grants could affect 43,000 jobs that would be generated by construction of the Regional Connector and subway extension projects. Metro has 9,000 permanent employees. Last week Moody’s placed 15 California transit agencies on review for downgrade, affecting $6.5 billion of rated debt.