BOSTON, MA (June 14, 2017) – The Boston Carmen’s Union Local 589 on Wednesday provided a presentation on the status of the MBTA Retirement Fund (MBTARF) to members of the Legislature, refuting recent information released by the MBTA about the status of the fund. MBTA management has sought to present the fund as “in crisis,” but a real, transparent analysis of the fund shows something very different. Thomas Roth, President of the Labor Bureau, Inc presented his findings and a thorough history of the MBTA decisions that have affected the fund.*
The MBTA recently presented an analysis that projected 4% return over the next 10 years – without any basis for the lower than average projections. In fact, the 30 year average return for the MBTARF is over 9.00%. The five year average return is over 8.00%, and an experience study conducted by the Fund’s Actuary in 2016 recommended retaining an assumed rate of return of 8.00%.
“Once again, MBTA management has used misleading statistics with the goal of sowing fear, while ignoring the truth,” said Jimmy O’Brien, President of the Boston Carmen’s Union Local 589. “Management is intentionally ignoring that the most significant challenge facing the MBTARF, which is that the MBTA has continually reduced the workforce, for decades, and as a result there are more retirees than contributors. We will not stand by while the T’s leadership disparages the fund and targets middle class workers and the pensions they have worked so hard for.”
Since 2015, the MBTA through layoffs, privatization and offering retirement incentives to their employees has experienced 728 retirements to date; at $80,000 per employee a year in wages and over $20,000 in pension and social security payments the MBTA has transferred over $72 Million in payroll costs to the pension plan. As a result, the MBTA has saved approximately $61.5 Million since 2014 by transferring payroll costs to the MBTA Retirement Fund.
About the Boston Carmen’s Union, Local 589
Founded in 1912, the Boston Carmen’s Union, Local 589 is the largest of 28 unions with members employed by the MBTA. Over 4,100 MBTA employees are members of the Carmen’s Union, including: Bus Divers, Train (Subway) and Trolley Operators, Maintenance of Way and Repairmen, Money Room Employees, and Automated Fare Collection (AFC) Technicians, Customer Service Agents (CSA), Dispatchers, and Clerks. Local 589 is part of the Amalgamated Transit Union, comprised of over 180,000 transit workers across the United States and Canada.