NEWARK, N.J. — N.J. Transit has implemented an emergency spending freeze and told employees that it will reduce its workforce by more than 200, rollback spending on retirement accounts and cut executive salaries, officials announced March 2.
A total of more than $30 million in reductions have been identified to help solve a combined $300 million budget gap projected for FY 2010 and 2011. The force reduction represents about 2 percent of the total workforce, and includes both union agreement and non-agreement employees.
“These are extremely painful steps, but unavoidable ones. We must close our serious budget shortfall, and we at N.J. Transit must do our part by making this the leanest, most efficient agency possible, without compromising safety,” said Executive Director James Weinstein. Weinstein said the workforce reduction will be the deepest one-year reduction in N.J. Transit’s 30-year history.
Meanwhile, the corporation’s contributions to employee 401K accounts will be reduced by one-third, and executive salaries will be cut 5 percent. These reductions follow in the wake of hiring and salary freezes that began last year, as well as unpaid furloughs for administrative (non-agreement) employees.
N.J. Transit officials also have identified cost reductions in parts, fuel, utilities, and contracts that will be renegotiated to avoid escalations. The emergency spending freeze allows the agency to halt spending that is not directly tied to operations or that is not critical for safety.
The agency also is continuing to develop fare and service change plans to respond to this financial crisis. Those proposals will be announced next week.
“Unfortunately, fare and service changes will have to be a part of N.J. Transit’s overall response to this financial crisis,” Weinstein said. “I know this will be painful for our customers. I welcome their suggestions and ideas as well as those of the public.”
He added: “The decisions we must make will not be easy. But together we can get through this very difficult time, and N.J. Transit can emerge a strong, stable agency that will be ready to respond to the transit needs of New Jersey citizens.”