TriMet General Manager Neil McFarlance continued to blame the agency's union for much if not most of its financial problems during a noontime speech to the Portland City Club on Friday.

McFarlane said the unwillingness of the Amalgamated Transit Union to agree that its members should pay a portion of their health care premiums was a major reason TriMet is facing a deficit of up to $17 million and considering raising fares and reducing service to close it.

"With no change, in the year 2020, TriMet will be paying over 50 percent of its underlying payroll tax in health benefits to active employees and retirees and will continue to rise year after year," McFarlane told the longtime civic group.

Union officials say they agreed to freeze wages in the last contract to preserve health care benefits and argue TriMet should cut management costs to balance the budget.

TriMet management and the union are currently locked in a standoff on the next contract. The state Employment Relations Board recently ruled management violated collective bargaining rules when it submitted its final offer and now owes union members retroactive pay raises. Management has nt yet decided whether to continue arbitrating the disagreement or appeal the ruling.

Significant changes under consideration to balance the budget include eliminating the Free Rail Zone downtown, eliminating zones and moving to a flat one-way fee and all-day pass, and reducing service on some bus and rail lines. A refined proposal will be released on March 14. The changes must be made before the next budget takes effect on July 1.

Despite the financial and union problems, McFarlane said TriMet is still providing a vital service in the tri-county region. He said someone boards one of the agency's buses and trains 330,000 times a day. MAX carries 26 percent of evening rush hour commuters on both the Banfield Freeway and Sunset Highway. Altogether, TriMet eliminates 4.2 tons of smog-producing pollutants every day, he added.

McFarlane also said the Portland to Milwaukie Light Rail Line that is currently under construction will benefit the local economy in the short run by creating 14,500 new and provide long-term benefits by reducing automobile congestion and supporting new development. He said the Obama Administration considers it "an integral part of rebuilding the economy."

Also speaking was David Knowles, a local planning consultant and chair of the Portland Business Alliance's transportation committee. He said the business community supports continued expansion of transit services and praise TriMet's capital construction program.

However, Knowles said the financial problems with TriMet's operations are hurting agency and need to be resolved. He also said the union has an "entitlement mentality" that is out of touch with economic realities and even other unions these days.

Although McFarlane opened his remarks by saying his criticisms of the union would make some City Club members uncomfortable, no one defended the union during the question and answer session that followed the presentations.

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