Calculation of Savings from Strike

The United Transportation Union (UTU) Local 23 has indicated that METRO is saving $53,000 per day from the strike, and has continually alleged that METRO has wanted a strike to save money. In order for the public to see the data involved METRO is posting a listing of the expenses not made as a result of the strike and the additional expenses that are occuring as a result of the strike. While there are savings that result from UTU drivers not being paid, there are also revenues that are not being collected as a result of the strike. When these are factored in, there are net savings of $3,171 on weekdays and a loss of $824 on weekends. As can be seen from the data below, METRO is not realizing any substantial savings while there is a strike.

In order to analyze the true impact of the strike, it is necessary to look at the long term impacts. In every strike that has occurred in the transit industry, there is a ridership loss that can take anywhere from 1 - 3 years to recover. Depending upon the loss of ridership, this can have major impacts on the financial health of METRO. For example, a 5% ridership loss for the next year translates into an annual revenue loss of $343,858. This amount will cause the deficit of METRO to increase. If the ridership loss amounts to 10%, the annual revenue loss would total $687,716. When these revenue losses are factored into the savings above, there are in fact no savings from a strike, and it will actually cost METRO money.

ITEM
WEEKDAY
WEEKEND DAY
 
Expenses Not Paid Per Day
Bus Operator Pay $ 21,566 $ 10,979
Medicare/CalPERS Retirement $ 2,304 $ 1,173
Accruals $ 1,861 $ 1,861
Total Bus Operator Pay $ 25,731 $ 14,013
Revenue Vehicle Fuel
Diesel @ $2.75/gal $ 7,348 $ 3,674
CNG @ $1.02/gal $ 348 $ 196
Total Revenue Vehicle Fuel $ 7,696 $ 3,870
Total Expenses Not Paid Per Day $ 33,427 $ 17,883
 
Additional Costs Per Day
Security Services
156 hrs @ $19.80/hr $ 3,089 $ 3,089
Custodial Services -- Steve $ 210 $ 210
Total Additional Costs $ 3,299 $ 3,299
 
Revenue Loss Per Day
Based on Oct 2004 actual and budget projections for FY 05-06
Farebox + Spec Transit Fares $ 23,519 $ 11,970
Hwy 17 Express $ 2,913 $ 2,913
Advertising Income $ 136 $ 136
Rent Income $ 389 $ 389
Total $ 26,957 $ 15,408
     
Total of Lost Revenue & Expenses $ 30,256 $ 18,707
     
NET SAVINGS $ 3,171 $ (824)
   
Estimated Future Revenue Loss  
  12 mos down 5%
Farebox $ 176,765
Special Transit Fares $ 114,275
Hwy 17 Express $ 52,818
Total at 5% Loss $ 343,858
 
12 mos down 10%
Farebox $ 353,530
Special Transit Fares $ 228,550
Hwy 17 Express $ 105,636
Total at 10% Loss $ 687,716

 

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