Budget Adjustment Bill Imperils $47 Million in Federal Transit Aid

Friday, February 25, 2011 at 9:34 PM by

A provision in the budget adjustment bill that severely restricts collective bargaining rights for public employees could have the side effect of reducing federal aid available for public bus systems in Wisconsin.

In a nutshell, federal law requires bus systems receiving federal transit aid to maintain at least the collective bargaining rights that were in place when federal funds were first received. The state budget adjustment bill restricts the collective bargaining rights of nearly all public employees, including those at the municipal level. The Legislative Fiscal Bureau issued a memo at the request of Rep. Tamara Grigsby (D-Milwaukee), concluding that the total amount of federal aid at risk in 2011 is $46.6 million.

Municipalities that contract with private companies to run their transit systems –as Milwaukee County does – would not face a loss of federal aid, since the collective bargaining restrictions in the budget adjustment bill apply only to public employees. In theory, other municipalities could privatize their bus systems to restore collective bargaining rights to their employees and thereby maintain their share of federal aid, but that process could take years. Bus systems can appeal the loss of aid if there are unusual circumstances, but it’s unknown how the Department of Labor would respond.

The effect of the loss of federal aid could be the total shut-down of bus services in many communities. For example, a Milwaukee Journal-Sentinel article by Larry Sandler includes a warning from Appleton Mayor Tim Hanna that the Valley Transit system could end operations as early as May if the federal support is withdrawn. Valley Transit stands to lose $2.5 million in federal aid from its $7.8 million annual budget. In LaCrosse, the bus system could lose $1.9 million, representing 35 percent of its operating costs, and another $1.2 million for new buses. Sheboygan Mayor Bob Ryan says, “If local transit does not get federal funding, local transit will not exist, put it that way. I don’t see fiscally, economically, how it could exist.”

Joint Finance co-chair Rep. Alberta Darling (R-Milwaukee) is reported as acknowledging the issue and saying she didn’t want to put any federal aid at risk. However, to the best of our knowledge, she did not offer an amendment to address this topic in Joint Finance or on the floor of the Senate. An amendment to maintain current collective bargaining rights for transit workers was tabled by the Assembly, and the Assembly passed the budget bill in the wee hours of Friday morning.

Tamarine Cornelius

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