is enroute to cutting 63 bus lines and 70 percent of service by 2025 without more changes to union health and retirement benefits, the agency’s general manager said Wednesday.

Once regarded as the gold standard of public transit in the U.S., TriMet is at real risk of becoming a "skeletal system" if its financial situation doesn't change, Neil McFarlane said in a doom-and-gloom "State of TriMet"

to the board of directors.

The address comes as management girds itself for new contract talks with

, with McFarlane warning riders they face one service crisis after another if the union doesn’t agree to “relatively small” concessions on benefits.

At the heart of TriMet’s contract proposal is a call for union employees to switch to the same health plans as non-union employees, including McFarlane, resulting in what he said would be significant savings.

“Are we a health care provider or are we a transit agency?” McFarlane asked.

Complicating matters is

. It allowed the agency to require drivers, mechanics and other union workers to pay more of their own health benefits.

Under that just-expired contract, union workers have a “90/10” plan that is still among the most generous in the transit industry.

With the family preferred-provider plan, for example, premiums for the average union worker cost TriMet $30,000 or more a year, while union employees pay 10 percent out-of-pocket costs up to $1,500 with no premiums. The plan also offers $5 prescriptions or 20% of cost – whichever is greater – and continue through retirement. In fact, a surviving spouse would continue to receive benefits for another 16 years, TriMet said.

Although the arbitrator’s decision was supposed to be binding, the ATU has appealed the decision, saying TriMet broke labor laws during bargaining. It hopes to restore

If TriMet survives the union’s appeal to the state Employee Relations Board, McFarlane promised that riders would not face further fare hikes and service cuts this fall. Since 2009, the agency has cut transit service by 14 percent and increased fares repeatedly.

Even if TriMet survives the ATU's latest appeal, service is on course to be cut by 70 percent by 2025, the agency warns.

If the agency loses, he said the agency would have no choice but to further gut bus and train service while charging higher prices to ride.

Of course, even if the arbitrator’s ruling is upheld by the labor board, TriMet can’t keep providing the current service levels without reforms to the labor contract, primarily when it comes to the growing cost of health-care benefits.

“In my view,” he said, “this is really an S.O.S. to our community -- save our service.”

If TriMet’s latest contract proposal – which doesn’t touch pensions and also increases wages 2 percent – isn’t accepted by the ATU, McFarlane warned, the budget shortfalls would require:

$19 million – or 11 percent -- in bus service cuts over 2013 schedules in fiscal year 2017.

$48 million – or 34 percent – in bus service reductions by 2020, amounting to 49 weekday bus lines vanishing.

$142 million – or 70 percent – in bus service cuts by 2025. That would result in the elimination 63 weekday bus lines, TriMet said.

McFarlane said the cuts on the administrative level would be in line with the service cuts.

“Our financial future and the future of transit in the region are directly tied to our ability to reform the contract,” he said.

Update:

ATU President Bruce Hansen returned a call for comment.

Filled with rhetorical hits, McFarlane's speech appeared to be a response to Amalgamated Transit Union 757's new campaign to sway public opinion.

With negotiations on a new contract expected to rev up soon, the ATU is using revenue from a recent $25-a-month increase in union dues to maintain a website and buy advertising to expose what it says are shifty TriMet management practices.

McFarlane's latest comments underscore why the marketing offensive is needed, said Hansen. "He's blaming the workers for everything," he said. "Why isn't he talking about how irrational management has been with spending?"

The math of McFarlane's predictions of service cuts and budget shortfalls was based on a long list of "assumptions," including no fare increase over the next two years, health-care cost increases of 9.5 percent a year and the growth of Lift paratransit as the population ages.

Given the teetering state of public transit in America, not to mention TriMet's shaky business model and spending habits, several transportation economists said it's not too hard to imagine the agency wasting away.

But far more than a lavish union contract would be at fault, they said.

Hansen said he couldn't take McFarlane's S.O.S. seriously after TriMet recently paid $1.4 million on new office furniture and is spending $9.5 million to renovate the Center Street administrative building.

"Do I think he's being truthful?" he said. "Not at all."

Check back for more developments on this story.

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