The culture of the Port Authority is changing. There is a strong management focus on reducing costs, maximizing revenue and increasing efficiency. Over the past year, Port Authority management has:

Instituted a broad series of cost-savings initiatives to address the Pennsylvania Transportation Funding and Reform Commission’s call for business reforms at the state’s transit agencies. Due to current collective bargaining agreements, the following actions only affect management employees and the Port Authority Police:

• Accelerated the departure of employees in a Deferred Retirement Option Program
• Eliminated “lifetime healthcare” for those retiring after June 30, 2007
• changed the “buy-back” of previous employment time to only military years of service and instituted 10-year vesting period
• Eliminated a $500 monthly pension supplement
• Increased employees’ healthcare contributions to 2 percent of annual salary in Fiscal Year 2008 and 3 percent in FY 2009
• Fiscal Year 2008 salaries frozen
• The CEO’s salary frozen through June 2009 (amounting to a three-year freeze) and elimination of his deferred compensation contribution by the Authority
• All senior management position salaries frozen through June 2008 (amounting to a two-year freeze) and elimination of their deferred compensation contribution by the Authority
• Eliminated use of accrued sick leave toward pension service
• Reduced the number of senior managers from eight to five

Eliminated 370 budgeted positions, including 50 administrative positions, and instituted 203 layoffs by June 30, 2007

Port Authority will realize more than $11 million in savings in Fiscal Year 2008 alone as a result of the wage freezes, layoffs and changes to employee pensions and benefits.

• Announced the start of Connect ’09, an ambitious 18-month initiative to connect neighborhoods through new service models and connect the region by enhancing coordination of transit services and adopting a regional fare collection system based on smart card technology. This formulation of significant changes to the business model will ensure the most efficient operations possible with available funding in the future

• Reached new agreements with the University of Pittsburgh and Carnegie Mellon University that significantly increase payments to Port Authority, which will generate more than $35 million over five years for Port Authority

• Reached an agreement to lease the park and ride lot adjacent to South Hills Village Station, generating more than $131,000 annually for Port Authority

• Held a series of six public workshops to refine a methodology for evaluating the efficiency of bus and rail service. That was followed by a series of nine public hearings on plans to reduce service and raise fares. Service was reduced by 15 percent (10 percent less than the proposed 25 percent) in June 2007, and planning for a January 2008 fare increase is advancing