Capital Metro Reaches Agreement with Union on Pension Plan

Aug. 20, 2012
Statement from Capital Metro Board Chairman and City of Austin Councilman Mike Martinez

I am pleased to announce that the last significant piece of the labor transition has been completed with Amalgamated Transit Union (ATU 1091), the transit union that represents most of the agency's bus operators and mechanics. This news comes as a result of much hard work and compromise on both the union's part and Capital Metro's. 

I'd like to thank my fellow board members and President/CEO Linda Watson for their willingness to tackle such a complex issue. I credit our staff and union leadership for making tough, but necessary decisions in a respectful and thoughtful manner. 

As chairman of the board for Capital Metro, I can tell you firsthand that we started these important discussions with the goal of doing everything possible to preserve the quality of life for our bargaining employees and to ensure the long-term sustainability of the agency. 

President Watson made this a top priority of the agency and put together a team that has been meeting regularly with the ATU for a year now in an effort to reach an agreement.  Jay Wyatt, the union's president here in Austin, has been instrumental to our good news today. His commitment to his members and collaborative spirit have gone a long way in making this much progress possible.

Through hard work and compromise, we have agreed to the following in regards to the current defined benefit pension plan which will freeze on August 18, 2012, when the labor transition occurs: 

  • Change the unreduced early retirement (URER) qualification from 25 years to 22.5 years of service (YOS);
  • All employees will have the ability to request a lump sum distribution after August 18, 2012 but if not yet at 22.5 YOS, they will be limited to the $10,000 lump sum and will forfeit the ability to ever grow into URER;
  • Employees who take the $10,000 lump sum could elect to receive the remainder of their lump sum when they leave employment with the contractor as long as they are not already in pay status.
  • Employees can make the choice to take a maximum lump sum distribution and begin monthly benefits when they reach 22.5 years of service (YOS) while continuing to work for the contractors;
  • Capital Metro committed to contribute the amount determined by the actuary of the Plan as the amount necessary to properly fund the Plan on an actuarially sound basis.  The contributions will be made at least quarterly.

Capital Metro and the union have also reached an agreement that there will not be objections to Capital Metro federal grant funding requests through August 2020 based on this upcoming transition or the future re-procurement of these services. This allows Capital Metro to continue long-term plans to replace buses and paratransit vehicles and upgrade shop facilities.

This agreement demonstrates Capital Metro and ATU 1091's commitment to reaching a solution that works for both parties and, most importantly, the community. 

During the course of our discussions, there have been several topics that have required both Capital Metro and the union to move to a place of compromise. I credit both sides in sacrificing some for the greater good. 

No decision was made lightly. Everybody involved understands how important it was that we got this right.  We are talking about protecting our employees and ensuring Capital Metro is able to continue the same high-quality service our community relies on now and in the future.

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July 31, 2012