More than 200 design consultants — posing a threat to the civil service system — are working side-by-side Local 375 members.

By GREGORY N. HEIRES

As the Metropolitan Transportation Authority prepares to impose new fare hikes on commuters, it is relying more on consultants to do the work of civil servants, costing riders and taxpayers millions of dollars a year.

One study found that by using in-house staff instead of outside contractors on 32 recent projects, MTA New York City Transit could have saved enough to cut the fare by 25 cents.
“More and more, consultants are sitting side-by-side by our people,” said Local 375 Treasurer Bob Mariano, president of the local’s Transit chapter. “They are tapping our brains to do our work.”

The number of consultants at Transit, which runs city subways and buses, started to mushroom after the agency imposed a hiring freeze in 2001. The consultants listed in Transit’s phone directory skyrocketed from about 65 in February 2002 to more than 200 eight months later.

“The use of consultants is partly a ruse to keep down the agency’s headcount,” said Local 375 President Claude Fort. “What’s worse, it’s wasting tax dollars and destroying the civil service.”

Since 1998, Transit has handed over two-thirds of its subway station rehabilitation projects to outside contractors. Transit is using more consultants in the face of an internal report indicating that the in-house staff is more efficient.

In the 1998 report, Chief Engineer Mysore Nagaraja argued that the agency should assign its in-house professionals to major subway rehabilitation projects rather than award contracts to private companies. The report is cited in “Contract Capers: Excess Costs and Politics in MTA Contracting,” a recent study by Citizen Action of New York.

The Nagaraja report studied 15 rehab projects, seven done by in-house workers and eight by contractors. It concluded that in-house work was “less expensive” and “higher in quality.” Typically, in-house projects were completed 17 months earlier than contracted-out jobs, which on average cost 11 percent more.

Citizen Action released its study in December as the MTA was under the public microscope because of its union contract negotiations and its claim that a large surplus had disappeared over a period of about a year.

“When the MTA is proposing steep fare increases and service cuts, using outside contractors — more expensive, less effective, slower and less safe than in-house workers — is particularly outrageous,” the report said.

A 50-cent fare increase takes effect May 1. Looking at 32 projects over the last four-years, Citizen Action found that using in-house staff could have saved $224 million — the equivalent of a 25 cent cut in the fare.

The study also found that:

• in-house projects cost 7 percent less than contracted-out work, and
• MTA New York City Transit could save an average of $7 million per station by assigning subway rehabilitation projects to its professional staff.

DC 37 plans to draw public attention to MTA’s wasteful use of consultants in a white paper to be released shortly by DC 37 Executive Director Lillian Roberts. DC 37’s white paper project, headed by Associate Director Oliver Gray with research by Rep Henry Garrido, describes a $6 billion “Shadow Government” of profit-driven consultants who are pigging out at the public trough. The profiteers comprise a “parallel workforce” of more than 100,000 employees outside the civil service system and unaccountable to the public.

“Every year, the city contracts out several billion dollars in work that could be done by our members,” DC 37 Executive Director Lillian Roberts said. “At a time of fiscal crisis and looming layoffs, this is unconscionable.”

An internal report on 10 consultant firms hired by Transit for a total of $50 million identifies 108 consultants. Some are called “IQs” — “Indefinite Quality” consultants from companies with contracts for specific projects generally lasting over a year. Temporary employment agencies provide the second group of consultants.

The cost of the most highly paid consultants dwarfs the pay and benefits of civil servants with comparable titles and responsibilities, though a number fill entry-level positions with low salaries and poor benefits, according to an analysis by Local 375’s Transit Authority Chapter 2. The study carefully compared workers’ total compensation by assuming that Local 375 members worked 40 hours a week, matching the consultants, and including fringe benefit and pension costs with salaries.

In a preliminary analysis of four IQ companies with contacts totaling $20 million, Mr. Garrido found that Transit could save $1.7 million or 8½ percent by bringing their work in-house.

Friends of George MTA contractor donations to Gov. George E. Pataki and New York State Republican Party*
Corporation		Pataki / New York State Republican Party Contributions
Cubic Corporation / Cubic Transportation Systems		$45,000
Halmar Builders (now Granite Halmar)		$9,000
HRH Construction		$7,500
Parsons Brinckerhoff Quade & Douglas (PB)		$41,650
Parsons Corporation / Parsons Transporation Group		$170,000
Petrocelli Electric		$6,000
Skanska USA / Skanska USA Civil affiliates & subsidiaries		$23,628
William Nicholas Bodouva / William Bodouva & Associates		$10,000
URS Corporation		$5,500
*Contributions were for 2001 election cycle. Source: “Contract Capers: Excess Costs and Politics in MTA Contracting,” Public Policy and Education Fund of New York, Citizen Action of New York, Dec. 12, 2002.

Revolving door
The highest-paid IQ consultant is Sr. Inspector Rakesh Singh of Tectonic with compensation totaling $270,655. Among the consultants from temp agencies, Sr. Project Manager Gerard Louit of HEPCO Staffing tops the list at $206,705.

By contrast, assuming a longer, 40-hour work week, civil service Assistant Engineers and Project Managers in Local 375 have compensation packages of $89,845. The total compensation of Civil Engineers (Level 3) is $141,846.

Local 375 members say a revolving door lets consultants and MTA officials and employees swap seats. A number of consultants are former MTA employees. Former President Alan Kiepper and former Vice President Jerome Forman went to work for the giant engineering firm Parsons Brinckerhoff. Former MTA Chair Richard Ravitch serves on the company’s board of directors, according to Newsday.

While Mr. Kiepper and Mr. Forman worked at Transit, the agency awarded at least $40 million in contracts to Parsons Brinckerhoff, according to Newsday. The company’s jobs include the $645 million 63rd St. tunnel between Queens and Manhattan and design work on the JFK airport AirTrain, which derailed last year and killed its conductor.

The Parsons Brinckerhoff family of companies is among a group of MTA contractors that contributed heavily to the New York State Republican Party and Gov. George E. Pataki (see box).

“Taxpayer funds are wasted on contracts given to campaign contributors, while taxpayers are left paying more for less,” the Citizen Action report says.