Brenna Goth

The Republic | azcentral.com

A January transit strike was the sixth called by a Valley union since 2010

The union hopes to convince voters to approve a regional transit system with public employees

Private companies save Valley cities money, transit officials say

A lingering labor dispute that for months threatened Phoenix bus service before culminating in a strike this year is part of a familiar pattern for Valley riders — and something transit union officials warn will escalate.

The picketing drivers and canceled routes affected tens of thousands of riders in January, after contract talks failed between Amalgamated Transit Union Local 1433 and Transdev, the private company contracted to run the service. A resolution came after eight days of negotiations, pressure from area leaders and a tepid compromise.

Last month's transit strike was the sixth called in the Valley since 2010 by the union, which represents bus drivers and other employees. In the six decades preceding that, the union's financial secretary and treasurer, Michael Cornelius, recalls only four.

The union's leaders say the work stoppages in recent years helped them reach fair contracts with large, private companies by breaking deadlocks in negotiations. The disruptions from East Valley buses to airport shuttles are a pattern they hope elected officials and county voters will soon end by creating a new regional transit system that runs its own service.

But private companies help Valley cities save money and run transit more efficiently than cities would if drivers and others were to become public employees, area transit leaders say. Phoenix has used the system for decades and has no plans for change.

That could leave riders in limbo as union officials build a coalition of political and community leaders to support a plan. Though the Phoenix strike is settled, three other transit contracts are up for negotiation this year.

“It’s going to continue to get worse,” Cornelius said.

New system sought

Last month's strike started over contract impasses on issues ranging from email policies to bathroom breaks, but underlying issues across the Valley's transit system played a role, too.

While buses throughout the region run under the Valley Metro brand, the system is actually a patchwork of contracts between cities and transit companies. Several unions represent different groups of employees, with the Amalgamated Transit Union Local 1433 negotiating for the drivers, fuelers and cleaners at multiple companies.

Local governments contract only with the company, bypassing negotiations over employee pay and working conditions. Those agreements instead are brokered between the union and service provider.

The system promotes months of a tedious back-and-forth and frequent strikes, said Amalgamated President Bob Bean.

Transit users, council members and school officials complained last month that service disruptions hurt people who have no other way to get around the city. Riders like Rhiannon Cutlit, 17,​ said the strike left them missing appointments or walking long distances.

"We're kind of on our own," she said at the time.

City changes to how some bus contracts are paid, plus changes in the leadership at major transit companies, have made the issues more pressing, Bean said.

The discord could be resolved with the creation of a regional transit system that hires its own employees, union leaders argue. More taxpayer money would stay in the region, and working conditions would improve, they say. What could be most appealing to riders is that the service would be strike-proof, as state law does not authorize work stoppages by public employees.

During the January strike, the union publicly introduced an emerging coalition that leaders hope will promote the overhaul. The Rev. Jarrett Maupin, a civil-rights activist known for organizing around community issues, was one of several people who called for a regional system.

Politically, the union's campaign will be an uphill battle, said Maricopa County Supervisor Steve Gallardo, who has worked with the organization.

“But it’s a discussion I think needs to happen,” he said.

Cornelius, though, said he thinks voters may be more supportive once they make the connection between who runs Valley routes and how often services are threatened.

“Sooner or later, when the public realizes they don’t have to go through this every year, they will probably jump on a ballot very quickly to end it,” he said.

No plans for change

City and regional transit officials say they have no immediate plans to change the system. Cities around the country tap contractors to run services that advocates say are cheaper and more efficient because of competition among private companies.

Phoenix, for example, has never run its own bus services. Instead, the city selects companies based on factors like past performance, safety, experience and cost.

Phoenix does not know how much money is saved by using private companies, according to Public Transit Department spokesman Lars Jacoby. But it's less expensive to provide drivers and services like fueling through a company that operates on a large scale, he said.

“It makes fiscal sense to do so,” Jacoby said.

Companies like Transdev bring international experience into a community, the company's Phoenix general manager, Katrina Heineking, said in an email, and can react more quickly to system changes than a government is able to.

While Phoenix recognizes services are not protected from strikes, the system is built to lessen the impact on riders, city leaders said.

Contracts include financial incentives to ensure companies provide some level of service during a work stoppage, Jacoby said. Providers aren't paid for the miles they don't run, and extra penalties can be assessed for missed service.

The patchwork of companies and contracts criticized by the union also protects the public, Jacoby said. While dozens of routes were affected in January, other buses operated throughout the Valley.

“It didn’t take the whole system out,” Jacoby said.

And though the city isn't directly involved in negotiations, elected leaders can exert pressure, Phoenix Mayor Greg Stanton said. Several strikes during his tenure ended quickly, he said, with others averted entirely.

“My role is really to remind all sides that the stakes couldn’t be higher,” he said.

Years of strikes

See a timeline of recent Valley transit strikes.

Even with those assurances, Transdev and the transit union have a history of contentious negotiations that affect Valley service. Stanton said he recognized the two sides "don't like each other."

The January dispute was months in the making, starting last year when Phoenix awarded the company a five-year, $373 million contract to operate dozens of its busiest routes.

In 2012, negotiations with Transdev — formerly Veolia before a merger in 2011 — ended in a six-day work stoppage that coincided with a strike against the company in Tempe. Short strikes in 2014 involved airport transit workers who also worked for the company.

The recent run is due in part to a contract change for some Phoenix routes that gives the company more incentive to control costs, as well as leadership changes at Transdev that caused friction, union officials said.

“A lot of this problem was personality driven,” Cornelius said.

But the union has called for work stoppages against other companies. Bus drivers went on strike in 2013 against transit company First Transit in the East Valley and have consistently threatened service disruptions, including before last year’s Super Bowl game.

Transdev’s Heineking said the union has "a history of using high-profile events as leverage during negotiations,” including this year's College Football Playoff National Championship game.

The France-based company, however, has faced strikes in other places. While the company successfully negotiated 23 labor contracts in 2015, Heineking said, a strike in Tucson lasted 42 days. Transdev attributes that strike to funding constraints within the city’s budget.

A federal mediator working with the groups declined to comment on the Phoenix negotiations. Former Arizona Supreme Court Chief Justice Ruth McGregor, who stepped in on behalf of the city, said she has often worked with the conflicting groups to help reach an agreement.

“I think the general atmosphere and attitude stays the same,” she said.

A resolution, for now

The settlement reached after last month's strike, though, has leaders working with the union calling for other changes to the system. Union bus drivers approved by 85 percent an agreement reached after they had been on strike for about a week with no pay and suspended health-care coverage.

The drivers saw several changes from the company’s previous offer​but also had to sacrifice part of a wage increase.

The decision to accept the terms came after it became clear the company would not budge, Cornelius said, and union officials feared they would be on strike long term.

“After spending eight days on strike, I think (drivers) were like, ‘OK, we can live without this,’ ” Cornelius said.

Hugh Hallman, former mayor of Tempe, stepped into negotiations during the stoppage and said they showed a system that was “completely broken,” though he does not support the union's charge for public employees.

Once a company secures a contract with the city, it loses the incentive to settle with employees, said Hallman, who would not disclose who asked him to help with the dispute. The pressure on operators during a strike is well beyond the penalties Phoenix could assess on the company, he said.

Transdev does lose money in the case of a strike, Heineking said, but she noted the impact on employees. They lost money “because of the union leadership’s decision to strike when they had one of the best offers presented in the transit industry in front of them,” she said.

And while all sides said they were thankful for a resolution that brought the buses back on the road, the relief might be temporary, Bean said. Similar issues could arise with negotiations for East Valley bus service and two airport contracts scheduled before the end of the year.

“I think we’re opening a lot of eyes,” he said.