• December 21, 2014
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Queens Chronicle

Questionable wage subsidies

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Posted: Thursday, August 21, 2014 10:30 am | Updated: 11:41 am, Thu Aug 28, 2014.

Mayor de Blasio’s plan to subsidize the wages of private school bus drivers with $42 million in taxpayer funding is worrisome for the precedent it could set. It’s also legally suspect.

Some members of the City Council seem to realize this, but they’re likely to vote to approve the plan today, Aug. 21, anyway, because they believe the workers who will benefit are underpaid.

The whole situation is backwards, and indicative of how the city can end up throwing away cost-saving measures when there’s a change of administration.

The bus companies whose workers will see their wages increase are ones who won their contracts under former Mayor Bloomberg, who made a point of constantly cutting some parts of the budget year after year in order to eliminate projected deficits — even while increasing spending in other areas. Apparently, the main reason they got the contracts is because they were able to undercut their competitors by paying less to their drivers, matrons and mechanics.

They were able to do that because of the elimination of employee protection provisions in contracts, which would have forced them to retain higher-paid senior workers. Instead they were able to hire new ones at lower wages. The issue drove school bus drivers to briefly strike in January 2013.

Now, those very companies will get to increase those wages at no cost to themselves, while the losing bidders who were willing to pay more all along get no benefit whatsoever. As Councilman Dan Garodnick of Manhattan asked during a hearing held Tuesday, according to the New York Post, “If we authorize a grant program here for those companies that won on the basis of being the lower bidders, are we not penalizing the folks who were bidding and intending to keep their senior workforce and their highest-paid workers in place?”

Garodnick also made the valid point that the subsidies may be illegal, because state law forbids the city from giving money to private companies except under certain circumstances. “It’s not clear to me that supplementing wages is one of them,” he said.

Even Michael Cordiello, the president of Amalgamated Transit Union Local 1181, who called last year’s strike, allowed that “there’s some credibility” to what Garodnick said. But of course he’s not about to turn down higher pay for his members.

If the Council goes through with the plan, we’d hope one of the companies that lost out will take the city to court, if only to find out if such a move is legal. And maybe to establish, one way or another, a more level playing field before the next bids go out.

Welcome to the discussion.