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Citizens Union


Beyond The MetroCard

Tired of the “please swipe again” message on subway turnstiles? The Metropolitan Transportation Authority has announced a pilot program to let customers get through the gate quickly and reliably by simply tapping their credit card on a turnstile.

While only a test of a new technology, the pilot program opens possibilities as revolutionary as the MetroCard.

The MTA’s experiment uses an existing technology, the MasterCard PayPass, which is already used at McDonalds, various drugstores and with vendors at the PGA Tour and other sporting events. Citibank MasterCard PayPass credit card holders enrolled in the pilot program will be able to use their credit card or a tag that can be hung on a keychain to zip through the turnstile. In the pilot, every sixth ride will be free as with a pay-per-ride MetroCard. The test is not compatible with unlimited ride passes and will not offer free transfers to buses. Participants will be billed on their monthly credit card bill.

Citibank is footing the cost of installing PayPass readers at 23 stations on the Lexington Avenue line and one station each in Brooklyn and Queens. Only trial participants will be able to use their PayPass-enabled cards or keys in the program. According to the MTA, the test is intended to determine how well the technology works in the New York City subway environment and whether riders would like to use this kind of payment. Experience in Chicago and Washington DC, both of which are far ahead of New York in contact-less fare payment, suggests that riders will flock to more convenient ways to pay the fare. Transit systems in both cities have been offering contact-less “smart cards” for several years. The cards work similarly to a MetroCard in that riders add value to the card at subway stations. There is a $5 fee for purchasing the cards, which can be recharged indefinitely. (The fee has been waived during introductory periods in Chicago.) Like the MasterCard PayPass, smart cards are tapped rather than swiped at the turnstile.

In Washington, over 800,000 plastic rechargeable smart cards have been sold and are used by one-third of Metro rail riders. The cards can also be used on the Metro rail and bus system and at Metro parking lots, and will be expanded to other rail systems in the DC area. DC area riders can now get a Citi MasterCard that doubles as a transit smart card as well. Chicago’s smart cards can be used on the city’s buses and trains and also on the suburban bus system, becoming the first multi-agency smart card in the country. When transit fares paid in cash – but not with smart cards – were raised in January, Chicago’s smart cards became so popular that local retail outlets ran out of them. Even before the fare change, 250,000 smart cards had been issued.

Chicago has two versions of smart card. One version is recharged at subway stations; the other is recharged via the users’ credit card. Like EasyPass tags used to pay bridge and tunnel tolls, Chicago Card Plus accounts can be managed on-line and the account can be automatically replenished when it runs low. The Plus card can be used to pay both per-ride fares and as a 30-day pass. Riders choosing the 30-day option can also “pass back” the card when traveling with others and are charged a separate per-ride fare for those trips.

The PATH system and transit systems in Hong Kong, London, Los Angeles, San Francisco, Boston, Houston, Seattle, Orlando and other cities are in various stages of smart card development and deployment. The PATH system is currently testing its smart card technology in a program that is not directly related to the MTA test.

The smart card systems currently in place or being tested show two approaches to smart card deployment. The primary approach continues the MetroCard concept of having a dedicated transit system payment card that may also be used for parking and other purposes. Like the MetroCard, it requires users to acquire the card and learn how to use it. For regular riders, transit system smart cards offer the convenience of quick entry and all the fare options of plastic fare cards like the MetroCard. Transit system smart cards can be implemented regionally so that travelers need not purchase separate fare media for subway, commuter train, parking lots, etc. As in DC, smart cards can offer the convenience of automatic replenishment.

The MasterCard PayPass is a different and intriguing approach, relying on credit cards that riders may already have in their pocket. It would seem particularly apt for visitors and occasional users who are not likely to want to bother with having a permanent smart card issued by the transit agency. Whether smart cards issued through private banks could or should ever replace the MetroCard – or could have all of the MetroCard’s capabilities such as free transfers and unlimited ride passes – does not seem to be addressed in this pilot.

The two approaches use the same RFID (radio frequency identifiers) technology. The cards use radio frequency to send encrypted account information to readers integrated with the turnstile. The same technology (though different encryption methods) are used by MasterCard, American Express and Visa. Thus, a turnstile programmed to accept MasterCard could also be programmed to accept other credit cards and smart cards issued by transit agencies.

Perhaps the best system would be a combination of transit system-issued smart cards and commercially issued cards. Regular riders would want the dedicated card with the full range of fare payment options. But the visitor could dispense with figuring out the local transit system’s arcane fare rules and just tap their credit card at the turnstile. These riders might not always get the best fare deal, but they probably would not be using the subway enough to want to worry about it.

Either way, the next generation of fare collection technology offers increased convenience and ease of fare payment for transit riders. As is the case now for motorists with E-Zpass, riders will almost never need to think about paying the fare wherever they travel. This will be good for both riders and for transit systems, which are likely to enjoy increased patronage from making their systems easier to use.

Bruce Schaller, who has been in charge of the transportation topic page since its inception in 1999, is head of Schaller Consulting, which provides research and analysis about transportation. He is also a Visiting Scholar at the Rudin Center for Transportation Policy and Management at New York University. 

Endless Traffic: Can It End?

On the third day of last month's transit strike, some New Yorkers found a silver lining in the shutdown of subways and buses. Bicycle traffic had increased by 500 percent. People got more exercise as they walked to work. And some of the emergency traffic rules -- requiring cars entering much of Manhattan to have at least four people, and restricting some avenues for emergency vehicles -- seemed to work.

"Because this strike is teaching us that we are dependent on mass transit, not cars, to travel in and around Gotham, we now have the freedom to rethink our outmoded policies of giving every inch of public space for the exclusive use of private automobiles," wrote Harris Silver of Citystreets in the New York Sun.

New Yorkers are of course happy the strike is over, and most surely hope that, when the vote is completed this week, transit workers will have approved their proposed new contract. But Silver is not alone in believing that something good came out of the strike -- a hint of what New York could do to combat congestion caused by cars and trucks.

Because such congestion pollutes the air, wastes energy, threatens pedestrians and cyclists, and affects the quality of life, a growing number of individuals and organizations say New Yorkers should not have to put up with it anymore. For inspiration many look to London, which three years ago began charging drivers to enter the city's auto-clogged central district during peak hours. (That's not all London has done: See New York Needs A London Plan by Stephen Hammer.) Although Mayor Michael Bloomberg has said that such a plan, popularly known as congestion pricing or value pricing, is not on his agenda, advocates still plan to pursue it along with other strategies that might ease traffic throughout the city.


New York City has a low rate of car ownership and remains the one major American city where most people do not even own a car. Almost half of New Yorkers use public transportation to get to work -- about ten times the national average, according to a report (in pdf format) by the Natural Resources Defense Council. Since many others walk or bike, only 360,000 New Yorkers drive cars to get to their jobs. Nevertheless, every weekday some 800,000 cars enter Manhattan south of 60th Street.

The city streets almost burst from the strain. "The heart of midtown Manhattan can accommodate only 9,000 moving vehicles without succumbing to gridlock," John Seabrook wrote in the New Yorker in 2002.

And so the average New Yorker who drove at peak hours spent about 50 hours a year in traffic delays in 2003, according to the Texas Transportation Institute's Mobility Survey (in pdf format). It's a lot worse elsewhere. New York ranked (in pdf format) as the 18th most congested urban area in the nation, behind not only such well-known bottlenecks as Los Angeles and Washington, D.C. but such smaller areas as Orlando, Florida, and Baltimore, Maryland.

Such statistics provide scant comfort. Congestion creates huge problems here. It fouls the city's air, since trucks, buses and cars create much of New York's smog and soot problem and adds to the greenhouse gases believed to cause global warming. The traffic wastes energy and slows buses.

The jams extend beyond Manhattan. One key argument against the Atlantic Yards project is that it would bring the already clogged traffic along Atlantic and Flatbush Avenues in downtown Brooklyn to a complete halt. Residents of Staten Island cite as a key problem the severe traffic congestion arising from the borough's rapid growth. The American Automobile Association singles out the exit ramp from the George Washington bridge in upper Manhattan as one of the worst "commuter hot spots" in the entire country, creating traffic jams on the Major Deegan and Cross Bronx Expressways.


At least some of this congestion results from deliberate policies over the years.

Indeed, congestion traditionally has been seen as an indication of urban vitality. To many experts, "a bumper-to-bumper crop of cars is a byproduct of the very prosperity, mobility and individual flexibility modern citizens value: Where traffic is at a standstill, it generally means business is humming," Ann Hulbert recently wrote in the New York Times Magazine.

For decades, Robert Moses, the city's master builder of the 20th century, encouraged cars by building parkways and gearing his projects to drivers instead of bus or subway riders. Planners removed rail track from bridges in favor of more lanes for cars. The Brooklyn Bridge could carry 426,000 people a day in 1907, but only 178,000 in 1988, according to former city traffic commissioner Sam Schwartz. To make matters worse, the city does not charge a toll to cross any of its four East River bridges -- and, since 1986, has charged only a one-way toll (into Staten Island) on the Verrazano Narrows Bridge, which some critics consider one of the most pro congestion policies ever devised.

The city government provides free or subsidized parking to some employees. As a result, government workers in lower and midtown Manhattan are twice as likely as their private sector counterparts to drive to work , according to one study (in pdf format). "If government workers commuted by car at the same rate as other workers, there would be 14,000 fewer cars coming into the Manhattan Central Business District each day," the report concluded.

And some critics charge the city's view of its role adds to the problem. "We're still measuring success the old fashioned way," said Paul Steely White, executive director of Transportation Alternatives. He notes that, under transportation, the Mayor's Management Report does not explicitly mention reducing traffic, and instead cites such goals as "improving traffic flow" and repairing potholes.


In 2000, central London faced many problems similar to those confronting New York today. Although only about 10 percent of people traveled into the area by private cars (by one estimate, less than 15 percent of New Yorkers use private cars to come into Manhattan), this greatly taxed streets that have changed little since medieval days. With London set to have an elected mayor for the first time, Ken Livingstone ran on a platform that included a charge on driving at peak hours in certain parts of the city, with the revenue slated for mass transit, particularly an increase in the number of buses.

Interestingly the idea for congestion pricing had its roots in New York -- in the work of William Vickery, a Columbia University professor and Nobel prize winner. In the 1950s, he proposed the subways charge riders more at peak travel times. He later extended the concept to traffic. The idea was adopted in Singapore and in three Norwegian cities. But in Vickery's hometown, congestion pricing has remained largely just an idea.

While the British may not be quite so enamored of their cars as Americans, it is a country whose onetime leader Margaret Thatcher said, "A man who, beyond the age of 26, finds himself on a bus can count himself as a failure." Livingstone's Conservative rival came out against congestion charges, and opponents set up a Web site to collect signatures and campaign against the proposal -- in sometimes virulent language.

But Livingstone won, and he and his traffic commissioner Robert Kiley, who once chaired New York's Metropolitan Transportation Authority, went ahead with the plan. Beginning in February 2003, the city charged cars entering an area of about eight square miles on weekdays 5 pounds, or about $8.75, with some exemptions. In July 2005 the fee increased to 8 pounds. People can pay at machines, stores and by Internet or cell phone. Video cameras photograph cars to insure compliance.

The city government considers the program a success. It lists (in pdf format) reductions in congestion of about 30 percent. Auto trips during peak hours declined by about 20 percent, as bus ridership increased by 29,000 in the first year. The city plans to extend the zone westward in February 2007.

There are dissenters. While the charges have eased inner city traffic, they have made things worse on approaches to the city and on outer roads, Johan Wennstrom wrote in Tech Central Station, an online technology publication.

Some say it has hurt business. "A five pound-a-day charge has already resulted in 70,000 fewer car journeys a day into central London -- and this diminution of paying customers has already had an extremely negative impact on retailers and restaurateurs in particular," the London Chamber of Commerce's chief executive, Colin Stanbridge, told the Guardian.

Other cities may follow London's lead however. Stockholm has been testing a plan and will decide whether to implement it permanently later this year.


On this side of the Atlantic, the idea attracted a flurry of interest last November when the Partnership for New York City, a business group, began discussing how congestion pricing might work here.

Some of the impetus arose from concerns that congestion is bad for business. ''In the core of Times Square, there is no doubt about the need to create more space for pedestrians,'' Tim Tompkins, president of the Times Square Alliance business district, told the New York Times. ''In one October afternoon a couple of years ago, between 3 and 7 p.m. we counted 4,000 people walking literally in the street, in traffic lanes, because the sidewalks were too crowded.''

But newly reelected Mayor Michael Bloomberg quickly cast doubt on any such proposal. "Although we're always open to ideas from the business community, this isn't on the mayor's second-term agenda," said Edward Skyler, then a Bloomberg spokesman (now a deputy mayor).

The partnership says it will issue a report later this year that will consider congestion pricing along with other measures to fight New York's traffic jams. But however the partnership comes down on the issue, other groups will push for it. The Citywide Coalition for Traffic Relief has formed to advocate a number of measures to combat congestion, including congestion pricing. And in its editorial on Bloomberg's inauguration for a second term, the New York Times said, "We hope that the mayor uses his unusual position to go a few places where no normal politician dares, like imposing congestion pricing for cars coming into those areas of the city with the heaviest traffic."

"There is no other tool out there as effective for cutting traffic as congestion pricing," Andrew H.Darrell, New York regional director of the group Environmental Defense, has said.

A 2003 analysis by the Regional Plan Association says charging people to enter part of Manhattan at peak hours could reduce morning rush hour traffic by up to 17 percent, depending on the specifics of the pricing scheme. In its analysis, the group found that only one percent of the four million people who enter Manhattan on a weekday would not do so because of a congestion fee.

There is some small precedent for the idea here. The Port Authority charges customers using EZ pass at its bridges and tunnels in the city $1 more at peak times than at less traveled hours of the day.

Until recently, congestion fees would have been unworkable because tollbooths with attendants would have had to collect the charges. But experts say the technology now used in EZ passes allows motorists to be charged electronically without even stopping.

The charges appeal to environmentalists and advocates for mass transit, walking and cycling. They also have support from some free-market champions. "Roads are congested because they are free, and because no market mechanism exists to allocate scarce road capacity," wrote Jerry Taylor and Peter VanDoren of the Cato Institute, a think tank that supports limited government and free markets.

But not everyone agrees. Mitchell Moss, a professor at NYU's Wagner school and onetime adviser to Bloomberg, has called congestion pricing "a threat to the economic vitality of our city." Writing in the Daily News, he said, the fees would "increase the cost of getting to work for New Yorkers who live in communities not served by mass transit, hurt Manhattan hospitals that treat patients from all five boroughs and make our museums and cultural attractions less accessible to suburbanites."

Others raise the equity issue. Congestion pricing, wrote Kerry Dougherty in the Norfolk Virginia-Pilot, penalizes lower income workers and "rewards those with flexible hours and punishes those with inflexible schedules [who] tend to be concentrated toward the bottom of the wage scale."

This is less true in New York than in other places,since in New York poor people are unlikely to own cars, let along drive them into Manhattan in the middle of the workweek. But certainly any fee poses more of a burden on people with less money to pay it.

And even the plan's adherents concede it would face huge political obstacles (in pdf format), with many observers predicting that Bloomberg would not want to risk a bruising battle on this issue.


Photos by Michael Hauer

The mayor has reason to be wary. Early in his first term, he considered placing tolls on the now free East River bridges to generate revenue. The idea had first surfaced in 1970, as part of a possible New York response to the requirements of the Clean Air Act. But it never went anywhere.

And it died again in 2002. Brooklyn Borough President Marty Markowitz reportedly called the tolls "a turkey," and his Queens counterpart, Helen Marshall, said commuters should not be "punished" for traveling from one borough to another. City Council members from Brooklyn and Queens protested too. Bloomberg backed down, saying, "Some of the effects of reducing traffic and that sort of thing would be ... a good idea, but I think, if you really look at it, it's not a short-term solution to our problems."

But advocates say it would solve problems. They note free bridges are not free, costing about $60 million a year to maintain and operate. According to a report (in pdf format) by transportation analyst (and Gotham Gazette columnist) Bruce Schaller, the tolls would reduce traffic congestion in downtown Brooklyn and Long Island City by up to 14 percent.


Turn-restricted Streets: Under Bloomberg, the city has designated nine cross-town Manhattan streets "Thru Streets," restricting turns from them during the business day. A report (in pdf format) by the Department of Transportation found that travel times on the street fell by 25 percent, while speeds increased by 33 percent.

Cleaner Fuel:Last summer, Bloomberg announced a $71 million program to improve traffic congestion in the city. In truth, much of the program would leave cars where they are but make them burn cleaner fuel.

Encouraging Alternative Transportation, etc.:The mayor's new program also called for spending $21 million on various efforts to encourage walking and bicycling and $14 million for improvements to the Traffic Management Center in Long Island City, which sends out electronic advisories of traffic tie-ups.

Traffic Calming: So called "traffic calming measures'' are not so much designed to reduce traffic as to make the cars less of a threat to pedestrians and cyclists. As part of the Downtown Brooklyn Traffic Calming Project, the city is changing the timing on traffic signals to give pedestrians a green light a few seconds before vehicles get the go-ahead. This, said Craig Hammerman, district manager of Community Board 6 in Brooklyn, "gives pedestrians the opportunity to take control of the crosswalk." While such measures do not explicitly aim to reduce congestion, Hammerman said, they can have that effect because they slow traffic down, making driving a less attractive option.

Parking policies: Drivers circling blocks looking for parking spaces create congestion. The solution according to some advocates: less parking, not more. A 2002 survey found that only 24 percent of the almost 30,000 curbside parking spaces in Manhattan south of 59th Street had meters. Donald Shoup, a professor at University of California Los Angeles and author of "The High Cost of Free Parking" argues that free parking adds to "extreme auto dependence, rapid urban sprawl and extravagant energy use." Shoup believes the city should set rates for on-street parking high enough so that about 15 percent of the spaces are usually unoccupied. London has already done this.

Removing Roads: For many years, people figured the solution to congestion was to build more roads. While such a solution is largely impractical in densely developed New York, many say it is not very effective anywhere. Building more roads, as the interstate system and Robert Moses' New York parkways have shown, makes driving more attractive, leading more people to do more of it.

Conversely, some experts believe, removing roads does not make congestion worse. In the late 1990s, Transport for London studied a number of major roads -- including the West Side Highway in the 1970s -- that were taken out of service. While traffic engineers predicted chaos, little resulted. Instead, some traffic disappeared, wrote Aaron Naparstek in the New York Press: "When it wasn't convenient to drive anymore, commuters took a different mode of transit, traveled at a different time of day, or made fewer, more efficient trips."

While few people call for destroying existing highways, advocates say that something must -- and can -- be done to ease traffic. "We got rid of graffiti, we have discounts on subways and buses, and we may even be on the verge of having clean public bathrooms," the Regional Plan Association wrote in 2003. "We have it in our grasp to do something about mind-numbing traffic congestion."

Related Article

New York Needs A London Plan, by Stephen Hammer.


Web Sites

- American Automobile Association: Provides information on traffic from a pro-driving perspective

- Bridge Tolls Advocacy Project: A Web site that seeks to promote placing tolls on the city's East River bridges

- City Streets: A pedestrian rights and advocacy group

- Citywide Coalition for Traffic Relief: A coalition advocating congestion pricing, traffic calming and other measures to reduce city traffic by 15 percent by t 2009.

- New York City Department of Transportation

- Transportation Alternatives: A New York group whose mission is to work for better bicycling, walking and public transit, and fewer cars.

- Texas Transportation Institute: Conducts research on transportation and issues an annual Urban Mobility Study on traffic congestion in U.S. cities and its cost in time and resources.

- Transport for London: The London's government on-line source for information on on congestion pricing, including the rules, test of the law and reports on how it has worked.

Articles and Reports

- Auto Asphyxiation: Car is King at the DOT (NY Press) A critique of city traffic policies

- Can Anyone Solve the Problem of Traffic? (The New Yorker): The traffic problem through the eyes of a television traffic reporter.

- Congestion Pricing for NYC (Manhattan Institute): A speech on why the idea makes sense by former city traffic commissioner Sam Schwartz

- Congestion Pricing in New York?: Yes (Daily News): An op-ed by Paul Steely White of Transportation Alternatives

- Congestion Pricing in New York?: No (Daily News) An op-ed by NYU professor Mitchell Moss.

- Driving Around Manhattan, You Pay, Under One Traffic Idea (New York Times)

- East River Bridge Tolls Revenue: Traffic, Mobility and Equity Impacts: A report prepared for the Straphangers Campaign and Transportation Alternatives

- An Exploration of Motor Vehicle Congestion Pricing in New York (Regional Plan Association)

- Fighting Traffic Congestion with Information Technology (Issues in Science and Technology): We have the technical means to solve congestion, but what about the political will?

- Gridlock Sam's History of US Traffic: Former city traffic commissioner Sam Schwartz on the roots of the congestion mess

- London Congestion Pricing: Implications for Other Cities (Victoria Transport Policy Institute)

- Pricing the Fast Lane (Cato Institute): A free market argument for congestion pricing

- A Traffic Knot Pulling Tighter (New York Times): The existing congestion problem around the site of the proposed Atlantic Yards development


Sorting Out The Transit Contract

The typical endgame to a labor settlement is very straightforward. Management and the union declare that the contract is “fair” and “good for both sides” while acknowledging that neither side got everything they wanted. Both sides urge ratification by union members and the governing board. Although reporters may get some union members and outside observers to critique the terms of the contract, the main actors on both sides stand firmly behind ratification.

This has not been the case with the settlement between the Metropolitan Transportation Authority (MTA) and Transport Workers Union (TWU) Local 100, announced on December 27 and now going to union members for a ratification vote.

Dissent and Disagreement

The first break in the usual script came on December 30, when Sewell Chan of the New York Times reported that Governor George Pataki was inclined to veto a key provision of the contract. That provision would give 16,000 workers refunds of pension contributions they made in the late 1990s. The governor’s spokeswoman said that, “The union leadership broke the law, and we will not reward those who break the law … We will not allow the union leadership to benefit from their illegal acts.”


The next day, a Pataki spokesman added that no one in the governor’s office had been told of the refund provision before the settlement was announced.

Then in the New York Times of January 5th, MTA Chairman Peter Kalikow, while praising the agreement, also indicated that he was unsure whether he would advise the MTA Board to approve the agreement.

On the union side, TWU Local 100 President Roger Toussaint stood behind the contract and called for its ratification. Some union dissidents, however, urged members to vote it down, noting in particular that workers will have to pay 1.5 percent of their salary toward health coverage under the new contract.

Questions and Implications

Understanding the contract and post-settlement developments raises questions about the terms of the contract and its implications for transit employees, the MTA and subway and bus riders.

Did the union gain from striking?

The MTA’s final wage offer stood in the final deal: three percent in the first year, four percent in the second year and 3.5 percent in the third year. But the union got management to drop demands to merge job certain titles and add duties for some workers. The union also won improved health coverage for pre-Medicare retirees; Martin Luther King Jr. Day as a holiday; assault pay for bus operators, train operators and conductors; improved disability insurance and a modest maternity benefit. And the union got the pension refund.

The union got management to drop its demands to require new workers to pay six percent of their wages into the pension system instead of the two percent that workers pay now. However, the union accepted the 1.5 percent health benefit payments for all workers, current and new. So the TWU upheld Toussaint’s stance that he would not “sell out our unborn,” but at a cost to today’s members.

So did the Metropolitan Transportation Authority yield as a result of the strike?

The MTA vehemently says no. It argues that its overall labor costs will rise by $400 million over the next three years as opposed to the $477 million cost of its final offer before the strike.

Much of this savings is from the switch from six percent pension contributions by new workers to 1.5 percent health contributions from all current workers. Over the next three years, the difference is about $82 more from the health contributions. In the long term, however, the higher pension contribution might have produced a higher return; one estimate quoted a figure of $70 million a year two decades from now. On the other hand, an escalator clause on health coverage may substantially boost its yield.

Of course, the authority's calculations do not include the $132 million cost of the pension refunds. When that amount is counted, the contract is more expensive than the authority's final pre-strike offer over the three-year contract term.

While the pension refund is a one-time payment, the health payments will presumably continue indefinitely. In that sense, the MTA agreed to a relatively large upfront expense in exchange for long-term savings. Of course, future labor negotiations could erase – or increase – those savings.

What are the pension refunds and what role do they have in the contract?

From 1994 to 2000, upwards of 20,000 of the 33,000 union members paid 5.3 percent of their salary into the pension system instead of the two percent that they paid prior to 1994. The higher payments were in exchange for joining an upgraded pension plan that allows workers with 25 years of service to retire at age 55. Employees could voluntarily elect this pension upgrade, or they could stick with the old system’s later retirement age and two percent pension contribution. Evidently, most chose the upgrade.

With the stock market swelling pension system assets, in 2000 the state legislature approved pension changes that included a cost of living adjustment and reduced pension contributions from the 5.3 percent back to two percent. The transit contract now calls for the legislature to approve refunds of the “excess” that workers paid into the system from 1994 to 2000. According to news reports, depending on employees’ salaries and overtime earnings, the refunds will range from $8,400 and be as high as $14,000 for some transit workers. (The pension terms are detailed in articles on the settlement and pension refund in the Chief-Leader, the civil service newspaper.)

The governor’s objection is that transit workers receiving $8,000 or more in refunds wouldn’t feel any pain from the roughly $1,000 per striker fines for the illegal strike. The refunds make it appear that the contract rewards workers for striking. This hardly burnishes Pataki’s conservative credentials as he contemplates a run for the presidency. It also might make another strike when the contract expires in three years more likely.

Pataki had twice vetoed bills that would have granted refunds, so on that score it seems that he is being consistent. But in vetoing those bills, the governor said they should be subject to collective bargaining – as they were after the strike.

How does this settlement affect the likelihood of a strike when the new contract expires?

There is one clear bit of good news for transit riders in the new contract: it lasts for 37 months. That means that the new contract expires in January 2009 rather than December 2008. January is still a cold month to walk, bike or car pool to work, but at least it’s past the holiday rush.

Beyond that, it is difficult to be optimistic that this experience reduces the chance of a future strike. The Taylor Law penalizes transit strikers two days pay for every day they are on strike. But the law discourages striking only if workers feel the pain in their pocketbook. The governor and other critics are correct that many union members are coming away better off, both short-term and long-term, after the strike.

But that is only part of the picture. Also critical to the prospects for a future strike are non-economic aspects of the contract. As I discussed previously, transit employees were negotiating for respect -– meaning improvements in their daily experience of the workplace -– as well as higher wages, better pensions and other economic gains.

This contract addresses the workplace issues by promising an independent study of the Metropolitan Transportation Authority's disciplinary system. Before the strike, much was made of the fact that there are about 15,000 disciplinary actions a year, or about one for every two workers. A close look at the disciplinary system is thus an important part of the contract.

It is doubtful, however, that a study focused on the disciplinary system will take the edge off the deep feelings of transit employees that caused many of them to be predisposed to walking out. Disciplinary actions are the tip of an iceberg that involves work rules, supervision and employees’ ability to be effective on the job and be treated as valued members of a team. The contract does not address those larger issues.

Does the contract address the MTA’s non-economic needs?

Here too, the contract seems to come up short. The needs of the transit system are slowly but surely changing. The tremendous improvements to the subway system over the last two decades, plummeting crime rates and introduction of the Metrocard fundamentally change what employees need to be doing. “Token clerks” were once sealed inside their booths for their own protection and to allow them to concentrate on selling tokens. Most subway stations are now safer than the street corners under which they sit, and tokens are no longer sold anywhere in New York. The Metropolitan Transportation Authority has talked about making token clerks into customer service agents who roam the station helping riders and keeping the station tidy. But the agency dropped demands for station attendants to do station cleaning.

Technological changes also make it possible for trains to be operated by one person instead of two, as currently. The MTA proposed to merge train operator and conductor titles and allow additional one-person train operations, thus negating an arbitrator’s decision that prohibited one-person train operation on the “L” line.

The potential labor cost savings are quite important in a context in which the authority's debt service payments are slated to rise rapidly in coming years. The idea of one-person train operation is hardly new; it’s used on some shuttle trains in New York already. There are in fact some train operations that are completely automated: the monorails at JFK and Newark airports are a local example. A newly built subway line that runs through the heart of Paris is another example. Yet the MTA dropped its demands to implement more one-person train operations.

What is the bottom line about the transit contract?

Calculating the bottom line is difficult because the contract involves short-term and long-term as well as economic and non-economic considerations and is somewhat contingent on future events. However, several things are evident.

First, transit employees who get pension refunds are substantially better off with the contract than they would have been with the MTA’s final pre-strike offer. An immediate payment averaging $8,400 trumps both the fines they will pay and the annual wage increases – even if it is taxable, as union members are beginning to realize.

Transit employees hired since 2000 are somewhat worse off, having to pay 1.5 percent of wages for health coverage starting with the contract, and probably a higher rate as health costs rise.

Future hires are better off, since they will not have to pay six percent toward their pensions.

The Metropolitan Transportation Authority got long-term health cost savings that in the short term surpass, and in the long term may rival, the savings from the six percent pension contributions that were dropped. But the $132 million pension refunds is a sizable upfront expense.

Subway and bus riders are better off than if the strike continued past three days, but worse off because there is little in the contract that will relieve pressures for biannual fare increases that are currently planned.

Bruce Schaller, who has been in charge of the transportation topic page since its inception in 1999, is head of Schaller Consulting, which provides research and analysis about transportation. 

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