Promised 'big think' missing from Sun Tran rate hikes

The Tucson City Council has for months now been weighing, mulling, ruminating and groaning under the weight of indecision concerning an increase in bus fares. Relax, gang. A fare increase is fine.

So says a customer who had a broken-down car towed from his apartment complex before he could raise the funds to fix it.

The best thing the Council can do for Sun Tran riders long-term is to get the bus service on firmer financial footing by making it more cost-effective. The city of Tucson already subsidizes Sun Tran to the tune of about $30 million per year, and that number has been going up while other departmental budgets are getting cut.

The fulminations have been going on for more than six months, with public hearings, public comments, Council meetings and Transit Task force discussions. The fare increases aren't that pronounced but the city of Tucson isn't exactly known for expediency.

The worst thing the Council can do for riders is allow another bus strike like the 42-day stoppage last year. Strikes are killers for the low-income work force who depend on the bus.

If history is any indication, the threat of another strike is less than a year away. Drivers and mechanics went on strike in 1997, 2001, 2010 and 2015. They narrowly averted strikes when negotiations dragged on past contract deadlines in 1998, 2007 and 2012 and 2014.

In the aftermath of last year's bus strike, the City Council seemed to have woken up to the idea that the Sun Tran model must be re-examined.

The strike should have served as a catalyst for change, Council Member Steve Kozachik said at the time.

Too many of our constituents and too many budget decisions depend on how we address those issues for us to allow a simple return to the status quo. I look forward to joining my colleagues, city staff, our management team, the union and the community in taking time to address these significant issues in a measured and thoughtful manner.

There was talk of increased fares, changing out the company that runs Sun Tran, establishing a local management team, making Sun Tran run on a dedicated funding source that belongs only to the bus system. Kozachik, the least union-friendly member of the City Council, and the union's chief negotiator each agreed a set revenue stream for Sun Tran is vital to the service.

But then there was an election, followed by the holidays leading into budget season and then came summer.

No change

Alas, the strike has not served as a catalyst for change. If there were big think discussions going on in the city, they would have passed through the Transit Task Force. A review of their minutes for the last year shows none of that.

Only the fee increase seems to have found traction.

That's my only problem with the fee increase. Any rate hike should be included in a plan that locks Sun Tran's labor union into a long-term deal to avoid another strike and to get a grip on the actual cost of operating the system.

If 70 percent of Sun Tran's budget is in the form of salaries and benefits and the city doesn't know what those salaries and benefits will cost next fiscal year, then it's hard build a pricing model that generates necessary revenue.

It's also as good of an excuse as any to stop the management by crisis model that has governed Sun Tran for the last 20-plus years, while the City Council bemoans its impotence, barred legally from interfering in relations. Yet it's the City Council that's ultimately responsible for the system and ultimately accountable. As often as not, the Council does step in to stop a strike by kicking in more cash.

Sun Tran must be run by a third party because city workers are forbidden to strike but federal mass transit grants forbid a recipient from forbidding strikes. So, Tucson has hired Professional Transit Management, which is part of global transit corporation TransDev. Transdev's primary owner is Caisse des Depots et Consignations, an offshoot of the French government that finances public housing.

Sun Tran is just a cog in the international Transdev machine. The company has a record of holding a tough line with unions, in part because when a company has to deal with 200 unions, it can't buckle anywhere for fear of looking weak everywhere. A locally run contractor wouldn't have to worry about how labor relations look in Cincinnati, Ohio, or Worcester, Mass.

Not only hasn't the city found a new contractor to run Sun Tran, it quietly renewed Transdev's contract in May. Therein lies the hitch. The deal expires at the end of April — three months before the union's contract expires on July 31.

I'm no labor negotiator but it seems like an arrangement guaranteeing Teamsters Local 104 will wait out Transdev's fate. Would you negotiate a deal with a company when you could wait and see if you can get a better contract with a new company that doesn't want a strike 90 days on the job? I'm not sure I would.

Transdev is already falling down on the first condition of their renewed contract: Dramatically increasing ridership. Ridership is declining, not increasing.

Look, just because a contract ends on X date, doesn't mean negotiations should start on D-Day minus 10. Any pro sports team knows the key is to lock in contracts well before the deal ends.

The Suns and Diamondbacks only have to fear free agency. Sun Tran's ridership fears economic calamity.

Rider finance

We're talking about the working poor and what they can and can't afford.

Let's do minimum-wage math. Someone works 40 hours per week at $7.90 per hour. That's $1,280 per month. Withhold from that 15 percent for FICA, another 10 percent for other taxes and $100 a month for health insurance premiums. We're left with $860 in take-home. Or even less for those workers whose health insurance isn't subsidized by their boss.

Start subtracting. Take away $30 for natural gas, $50 for electricity, $35 for a cheap phone and $35 for basic Internet. Let's take out $30 for grooming, household supplies and clothes — big spender.

Rent is a big variable. Someone with a roommate may pay just $300-$350 per month but the roommate may expect the fry cook to pay for half the deluxe cable package and keep the place at 75 degrees in the summer. Someone with a kid may have to pay $500 to $600 a month. So let's split the difference and say $450 a month, plus $35 for water, sewer, trash and renter's insurance.

Subtract another $25 because stuff just comes up — something always comes up. Mom's birthday, a big electric bill, a new work uniform.

All that subtracting adds up to right at $780 in costs minus the $960 in salary that leaves our guy/gal at $180 per month for everything else, including food or half a shot at a social life. (My food budget in college was $130 per month and I graduated in 1993).

Wait. We forgot transportation. Let's assume somehow the worker has a car. Find from that $180 that's left the $50 -$200 for insurance, $60 a month for gas and the inevitable repairs, which I'll wing and prayer at $25 a month (not including the tires). Hell, let's change the oil and filter. Another $10 bucks a month because they can do it themselves.

So, without a car, our minimum-wager has $180 at the end of the month to feed and entertain themselves. With a car, assuming a great driving record and that they are older than 25 when the rates go down, he or she has got $35 to eat, save for a rainy day, handle contingencies — like forking over cash to register their vehicle — and who knows about dating or having a family.

They could also go Sun Tran. They make too much to qualify for the "economy" fare but can buy a monthly fare for $42, which may go up $7 ($121 per month for food, and everything else).

No help for the weary

Let's disabuse ourselves of any idea that welfare will come to the rescue. They don't qualify for AHCCCS (Arizona Health Care Cost Containment System, or what's known as Medicaid in the rest of America). Food stamps may kick in a few bucks but it's not going to feed them. Renter's assistance requires a court summons for eviction and there's enough money in that system throughout Tucson to help 40 families per year just once. The Community Food Bank of Southern Arizona will get you a small box of grub per month. By that I mean, a bag of beans, a bag of rice, a loaf of bread, a box of cereal, a can of vegetable soup and a tiny jar of barely edible peanut butter.

No bounty exists from the U.S. Department of Dereliction and Sloth Services. There's no such thing as "Federal General Purpose Assistance for Lazy Slackers Stealing from the God-Fearing."

Now watch Sun Tran go on strike and subtract a week's pay. Our guy is (trigger warning, profanity ahead) fucked and fucked for months. Now we have to subtract from that $131 dollars, $150 for a late rent check, another $200 in deposits and re-connection fees if a utility is shut off, and they still have to figure out how to eat.

Smart fees except for the vacuum

The proposed fee increases generally follow recommendations by Transdev in 2014, when they provided a pretty good audit of Sun Tran. The company didn't find the basic fare was too low but the economy passes were too heavily subsidized.

The solution is not to simply increase fares, the city can bring in additional revenue, as Transdev pointed out in an audit of the system.

Because of the way discounts are provided, the net result would be marginally higher revenue, but also lost passengers. Sun Tran currently takes in approximately $0.63 per passenger or approximately 43% of the full fare of $1.50. Without addressing discounts and usage, a $0.25 or any other increase would only yield an additional $0.11 or less than $1.5m in additional fare revenue per year when factoring in elasticity as shown in the following table. In essence, a 50% fare increase would only result in a 27% revenue increase.

The discount fees are what's out of whack, more than the standard fare and that's exactly what the Council is looking at doing.

However, there are other ways to improve farebox recovery through technology and moving from a standard fare to a distance-based price. Who knows if either are options for Tucson, but we should be looking at all of it and not just discussing fare increases in a vacuum.

The service will never be self-sufficient. In the world, the only mass transit systems that pay their own way criss-cross cities that invest little in highways or roads. They tend to exist only in the eastern Asia. According to the service's monthly reports, Sun Tran returns just 17 percent of its budget through fares.

The city can do better because it was doing better last year, recovering 22 percent. If the system gets to 30 percent, it's doing great compared to bus services in San Antonio and Dallas, where riders cover less than 15 percent of the total cost.

Because the city is legally prohibited from interfering with the negotiations, the city loses its leverage when it waits until July to broach the subject of wages and benefits in any sort of broader context. They could, however, bring natural stakeholders into broader discussions about how to make Sun Tran work better for everyone — the riders, the operators, the company that runs it and the taxpayer riding around in SUVs cursing the big bus that stopped and cost the motorist another streetlight cycle on Broadway.

The poor are financial swashbucklers, somehow keeping themselves afloat with cunning and guile. They'll figure out how to pay an extra $7 for a monthly pass or dime for a one-way trip on the big bus if it means no more bus strikes.

It doesn't mean that at all, the way the City Council is going business as usual. It's a ritual that gave the community strikes or near strikes eight times in the last 20 years.

Because here come the holidays, leading straight into budget season, followed by summer vacation and (uh-oh) July 31 will be here in no time.