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Federal Work Rules and Regulations Undermine Public Transit

Samuel Staley
May 30, 2011, 7:45am

Stephen Smith has a couple of very good posts over at the Market Urbanism blog highlighting the ways federal regulations and labor work rules undermine public transit efficiency. This is a much, too much neglected issue. Stephen points to "Buy America" provisions that drive up costs (May 22, 2011) and creates absurdities in procurement:

"Buy America is a policy dating back to the Great Depression which requires the government to buy goods made in America when at all possible. For transit, it means that 60% of all materials, from steel to streetcars, must be sourced domestically, and final assembly must take place in the US as well. This final assembly requirement sometimes (often?) means that transit vehicles manufactured abroad are disassembled, shipped to the US, and then reassembled by American workers – the modern-day equivalent of paying people to dig holes and then fill them back up. Normally there are waivers if parts and materials would raise the cost by more than 25% and in the nebulous case that applying Buy American “would be inconsistent with the public interest” (seems to me like it’s always inconsistent with the public interest), but it doesn’t look like the current administration will be granting them any longer."

In a separate post (May 15, 2011), he highlights five work rules that undermine transit, including mandatory eight hour work days, no part-time hiring, limits on the cross use of labor, and generous vacation benefits. (Stephen doesn't mention federal rules the protect employees from outsourcing, but perhaps he'll discuss this in another post.) All these limits and others conspire to create a very lucrative (for the employee) wage and salary package that makes transit less competitive, less productive, and inefficient.

That seems like a good place to start for a reform agenda that could dramatically improve mass transit productivity and reduce costs to more sustainable levels.

Samuel Staley is Research Fellow

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