Muni management, pointing to the agency's anemic finances, has moved to put the kibosh this year on year-end payouts from a special trust fund set up for the city's transit operators.

Unless the decision is reversed - the operators' union is reviewing its legal options - there will be no annual disbursement, which in years past has put up to $3,000 extra into each worker's pocket at the start of the winter holiday season.

The cumulative hit to Muni would be $3.5 million this year, said management spokesman Paul Rose. Muni's operating budget this year is $775 million.

It is "beyond dispute that the SFMTA (San Francisco Municipal Transportation Agency) remains in a state of fiscal crisis. The agency has exhausted its reserves; service cuts remain in effect; and the agency is facing another deficit for the upcoming fiscal year," Debra Johnson, the agency's director of administration, explained in a memo to the head of the operators' union.

At the same time, she dangled the prospect that at least some money could be freed up at the negotiating table. "We invite you to bargain over what amount, if any, that the SFMTA shall contribute to the trust fund for the current fiscal year," she said.

But Rafael Cabrera, acting president of Transport Workers Union Local 250-A, told The Chronicle Friday that there's no need to negotiate.

"The MTA has a legal obligation under the charter to fund the trust fund," he said. "The attorneys are involved and it's going to be a legal fight."

Prior to the current fiscal year, which began July 1, Muni spent nearly $18 million in the past three budget cycles to replenish the trust fund. The contribution is based on a complex formula set in the City Charter. It takes into account the benefit packages provided to transit operators in the two highest-paying agencies.

Pay for Muni operators, the second-highest among comparable agencies in the United States, is based on a similar formula.

San Francisco voters overwhelmingly approved a Charter amendment in November to abolish the automatic compensation calculation and force Muni operators to bargain for pay and benefits during contract negotiations. The idea behind the ballot initiative was to give management more leverage at the bargaining table to cut labor costs by getting rid of inefficient work rules.

However, Cabrera contends that until the current contract expires at the end of June 2011, management is obligated to make the trust fund payments.

Nathaniel Ford, executive director of the Municipal Transportation Agency, said Friday that question is being researched by the city attorney. But for now, "our current position is that the operators are not getting the payouts this year."