MARTA hasn’t decided on response to costly ruling regarding paratransit service

By David Pendered

MARTA’s leadership has not determined if it will appeal a ruling that it must return its paratransit service to an in-house operation and compensate employees who lost wages or benefits as a result of the privatization of paratransit in 2016.

The clock is ticking. MARTA has until May 14 to comply with the ruling.

The ruling was issued Feb. 3 and provides MARTA 100 days to comply.

A three-member arbitration panel determined MARTA does not have the right to subcontract its federally mandated paratransit service. The vote was 2-1, with the union-appointed arbitrator and the neutral arbitrator ruling against MARTA. The arbitrator appointed by MARTA ruled for MARTA.

The neutral arbitrator was appointed by the arbitrators appointed by MARTA and the Amalgamated Transit Union, Local 732.

The ruling was issued in response to a grievance filed by the union. The issue was whether MARTA had the legal right to subcontract its paratransit service. The quality of the service was not at issue. Some 300 employees were affected.

The ruling has wide-ranging costs associated with it.

In addition to paying whatever wages and benefits may be determined, MARTA has been instructed to resume the provision of a service that was a huge cost to the transit system.

A management audit conducted in 2012 determined that MARTA’s cost per paratransit trip was $50.43. The rate was 27 percent higher than the sourced market cost.

MARTA released a statement on Feb. 24 from Erik Burton, MARTA’s senior director of media relations:

• “MARTA’s Mobility service remains a critical resource in providing transportation services for those individuals who cannot always utilize regular MARTA service.
  

  MARTA CEO Keith Parker testified that the privatization of paratransit contributed to the passage last year of the transportation sales tax.

• “We have not made a final determination on our future course of action in response to the recent arbitration ruling, however MARTA will continue providing the highest level of service to all of our valued customers who are unable to ride or disembark on our regular MARTA services.”

In outsourcing the paratransit service, MARTA’s board of directors was following a recommendation contained in a 2012 management audit. The audit was conducted by KPMG at the behest of MARTA’s board of directors and then-CEO Beverly Scott. At the time, MARTA was under a firestorm of political pressure from state lawmakers. The lawmakers were demanding MARTA curb spending to reduce yawning budget deficits that threatened the future viability of the region’s largest public transit system.

MARTA CEO Keith Parker testified in the arbitration hearing that the privatization of paratransit helped restore public confidence in MARTA. That confidence factored into the voter approval last year of a transportation sales tax that will benefit MARTA:

• “If we didn’t show that the agency was serious about getting better, … I don’t think these other opportunities [the bond measure] that are now in front of us would exist.”

However, KPMG warned of potential litigation over the outsourcing. The audit cautioned MARTA to:

• “Work with legal counsel to determine impact of contractual agreements and federal transit laws on sourcing and, if applicable, develop and issue an RFP [request for proposals] for paratransit services.”

MARTA’s arbitrator contended in his dissent that MARTA had acted in good faith with the union. The arbitrator also noted that the state House had enacted legislation that mandated the outsourcing of paratransit service. (The bill did not become law.)

Nonetheless, the ruling by the panel states:

• “The Board of Arbitration directs MARTA to restore its paratransit operations to an in-house operation within 100 calendar days of the date of this opinion and award and to make affected employees whole for wages and benefits lost or diminished as a result of MARTA’s contracting out its paratransit operations, effective on or about May 21, 2016.
• “In the interim, the parties may negotiate an alternative resolution of this dispute satisfactory to both parties. If the parties do not agree regarding an alternative resolution within 100 calendar days of the date of the Opinion and Award, the remedy directed above shall be effective.”

The ruling said the board will retain jurisdiction of the grievance until Aug. 4, 2017 to resolve any disputes.