(Bloomberg News circulated the following article on December 20.)
NEW YORK — New York’s transit union shut down the city’s public transportation system today for the first time in 25 years, forcing 7 million daily bus and subway riders to seek other options, after failing to reach a new contract agreement with the state Metropolitan Transportation Authority.
The walkout, mirroring a 1980 strike that halted the U.S.’s largest transit system for 11 days, triggered Mayor Michael Bloomberg’s emergency plans to keep the city moving, including a ban on vehicles carrying fewer than four people from entering the busiest part of Manhattan this morning.
The strike threatened to paralyze the city five days before Christmas, the height of the holiday shopping season, at a cost to the city’s economy the mayor estimated at $400 million a day. Bloomberg said the city was seeking an emergency hearing before a state judge to fine Transport Workers Union Local 100 and to force the workers to return. He called for public patience.
“We will show that New York City works even when our buses and subways don’t,” Bloomberg said. He called the strike “illegal and morally reprehensible.” The mayor is founder and majority owner of Bloomberg News parent Bloomberg LP.
The move exposes the union and its members to millions of dollars in penalties under a state law that prohibits walkouts by public employees. Strikers risk losing two days’ pay for every day of work missed, and the city has filed suit against the union seeking about $22 million a day in damages for lost tax revenue and police overtime in case of a strike.
Injunction
“Every effect that the law allows will be brought to bear on all striking members,” MTA Chairman Peter Kalikow said in a news conference after the strike was declared. The MTA and the state attorney general, which last week won an injunction against a strike, will seek to have the union found in contempt of court, Kalikow said.
The union, which halted two bus lines serving about 50,000 riders in Queens yesterday while talks continued, began shutting down the rest of the city’s bus and subway system about 3 a.m., four days after their previous contract expired.
The strike decision, by the union local’s executive board, came after Roger Toussaint, Local 100’s president, left face-to- face talks with Kalikow about an hour before a midnight deadline.
Offer
“We did not want a strike, but apparently the MTA, the governor and mayor did,” Toussaint said as he announced the walkout. New York Governor George Pataki appoints the members of the MTA board. No date was set for a resumption of talks.
“The MTA put a fair offer on the negotiating table,” MTA spokesman Tom Kelly said late last night at the Grand Hyatt hotel near Grand Central Terminal, where the talks were held. “The MTA remains ready to continue negotiations.”
The MTA offered the union a three-year contract with raises of 3 percent, 4 percent and 3.5 percent through 2008, Kelly said. The transit agency also agreed to retain the union’s full-pension eligibility age at 55, on condition new hires contribute 6 percent of their annual earnings for 10 years to help finance future pensions, he said.
They also gave workers Martin Luther King’s Day as a paid holiday.
`Dignity and Respect’
“New Yorkers, this is a fight over whether hard work will be rewarded with a decent retirement, a fight over the erosion or eventual elimination of health benefit coverage for the working people of New York, it is a fight over dignity and respect on the job,” Toussaint said in a news conference.
Subway operators earned an average of $62,438 a year, including overtime, under the previous three-year contract, the MTA said. Train conductors averaged $53,000, subway booth clerks $50,720, and bus drivers $62,551, the state agency said. The MTA wasn’t able to provide the average amount of overtime.
The union directed members through its Web site to lock subway turnstiles when the strike was announced. Subway operators were to complete their trips. Any passengers aboard buses were to be taken to their destinations, the union said.
“No passenger will be left stranded on a bus,” according to the union’s Web site.
The last subway train passed through the Lexington Avenue/59th Street station about 3:50 a.m., leaving station agent Brenda Martin, a 20-year MTA employee, to close her booth.
“I have no idea how I’m getting home,” said Martin, who lives in Long Island.
City’s Plan
Under the city’s strike plan, police are prohibiting vehicles carrying fewer than four people — including private autos, limousines and car services — from entering Manhattan south of 96th Street between 5 a.m. and 11 a.m. Commercial deliveries are banned during those hours, the mayor said.
Taxi drivers are permitted to fill their cabs with passengers going to different destinations, and charge each as much as $10 to ride within certain multiblock zones, and $5 more for destinations beyond the pick-up zone.
Streets around the financial district are closed, including Nassau Street from Wall Street to Spruce Street; Rector Street from West Street to Broadway; and Vesey Street from Church Street to Park Row.
Several major north-south thoroughfares are closed to automobiles, including Fifth and Madison Avenues, between East 23rd and 96th Streets, as well as east-west routes including 26th, 29th, 49th, and 50th Streets.
Carpool staging areas are set up at Shea Stadium in Queens, near a Long Island Rail Road stop; Yankee Stadium in the Bronx, near a Metro-North Railroad stop, and in parking lots adjacent to the Staten Island Ferry, according to the plan. Long lines of people waiting to buy tickets into the city were visible at the LIRR Jamaica Queens station.
Walking, Telecommuting
The strike forced many to work from home or walk to the office. Those from outside the city were taking advantage of company carpools and vans from Penn Station and Grand Central.
Mike Sheridan, a fund manager at Reserve Management Corp., walked the three miles to his office at 32nd street and Broadway from West 89th street this morning, adding an hour onto his commute. Bank of Tokyo-Mitsubishi Economist Christopher Rupkey, who lives in New Jersey, opted to work from home today.
Dean Maki, chief U.S. economist at Barclays Capital, wasn’t affected by the strike. He took Metro-North in as usual to Grand Central for a short escalator ride to his office. Stephen Gallagher, chief U.S. economist at Societe Generale, also took Metro North and said most workers were making it in to their office.
`Love a Challenge’
Barbara Tarmy, 52, a partner at investment manager HA Schupf & Co. had no trouble getting a taxi from her home at 70th Street and Central Park West to her office this morning. She said some of her colleagues are walking to work.
“New Yorkers love a challenge,” Tarmy said. “People are in flat shoes and warm jackets and are ready to walk.”
The Bond Market Association has recommended normal trading hours for U.S. dollar-denominated fixed income securities. The industry trade group said last week that it surveyed its members and determined that they were undertaking measures to make sure they would be able to operate in the event of a strike.
The New York Stock Exchange was planning to open at regular hours. The New York Mercantile Exchange, the world’s largest energy market, chartered about 24 buses to transport workers beginning at 6 a.m. throughout the city, according to the NYMEX Web site.
Contingency Plans
“We made contingency plans last week with the threat of a strike,” said Keith Keenan, 32, head of trading at Wall Street Access, which trades for mutual funds and hedge funds from Battery Park City in downtown New York. “Some guys in Brooklyn made a carpool and came in together. Other guys in Brooklyn had their wives drop them at the Brooklyn Bridge and then they walked. The people on Staten Island took the ferry.”
“I took the path train from Hoboken,” said Keenan. “There were clearly a lot of people who had never taken it before who got off at the World Trade Center and were looking around like they had no idea where they were.”
“The commute home is going to be a nightmare. We’ll put people up in hotels if we need to,” said Keenan.
In preparation for today’s strike, Saks Fifth Avenue Inc. Chairman Fred Wilson told 800 corporate staff members by e-mail to be prepared to pitch in at the company’s flagship store, which has 2,000 employees in Midtown Manhattan, said spokeswoman Lesley Langsam.
“This is not easy for anyone,” Langsam said.
Travel Reimbursements
Gap Inc., the largest U.S. clothing chain, with 40 Gap, Banana Republic and Old Navy stores in Manhattan, said it will provide as much as $15 in travel reimbursements for employees coping with the strike, said spokeswoman Kris Marubio.
Kathryn Wylde, president and chief executive of Partnership of NYC, said large companies will be able to get through the strike, though it will be much harder for small businesses and workers. It is also going to hurt the city’s tourism industry, said Wylde, who carpooled to work.
“New Yorkers are facing some challenging times ahead,” Pataki said in a statement. “In the coming days, I encourage all New Yorkers to be patient and resilient as we work together to overcome the unnecessary crisis that has been set upon us by this illegal strike.”