A newly introduced bill that changes RTD’s terms for privatizing bus service could saddle the agency with tens of millions of dollars in additional costs annually and further threaten the financial viability of its FasTracks transit expansion, RTD officials warned Thursday.
Senate Bill 251 would eliminate the current requirement that the Regional Transportation District contract out at least 50 percent of its bus service – including special services for the disabled such as access-a-Ride – to private firms.
It would cap privatization of RTD’s bus service at 55 percent. Currently there is no cap.
Over the years, backers of privatization in the legislature have increased the percentage of RTD bus service that must be farmed out to private firms. Supporters argue that it encourages competition and saves money.
Opponents say privatization merely creates a two-tier bus system, with contractors offering lower wages and fewer benefits to its drivers and mechanics than RTD.
The transit workers union is promoting the bill. The measure ensures there will be enough RTD employees “to step in when private contractors fail,” according to Amalgamated Transit Union Local 1001, which represents about 1,800 RTD drivers, mechanics and other employees.
On Thursday, the bill was approved by the Senate Transportation Committee and sent to the full body.
At a hastily called meeting Thursday evening, RTD general manager Cal Marsella told board members that if the bill becomes law as written, the union could try during contract bargaining to win a reduction in the percentage of privatized service.
RTD pays about $63 an hour now for privatized bus service, but that could rise to $91 an hour if the work were brought back inside the agency, Marsella warned.
If there were no private bus workers, it could cost the agency an extra $35 million a year, Marsella said, adding that all financial projections for FasTracks were based on the 50- percent-privatization minimum.
As a compromise, RTD board chairman Chris Martinez suggested the agency get legislators to amend the bill with a clause that says privatization percentages will not be a subject of collective bargaining.
Board members directed their lobbyists to try to have that amendment added to the bill.
Local 1001 president Holman Carter and political director Bill Jones said they could not comment on the proposed amendment until the union’s executive board considered the issue.
Staff writer Jeffrey Leib can be reached at 303-954-1645 or jleib@denverpost.com.
