Due To Deficit, MCTS Considering Hiring Freeze

MCTS Bus. Photo by Jeramey Jannene.

In the face of a projected $10.9 million budget deficit, the Milwaukee County Transit System (MCTS) is considering a hiring freeze.

Details about the deficit and the agency’s response are beginning to trickle out after MCTS officials failed to report the shocking deficit until June. A report on the projected deficit prepared by interim Managing Director and Chief Financial Officer Alexander Corona briefly outlines five factors contributing to the operating deficit and some of plans for addressing them.

One idea: “A temporary suspension of new employee recruitment and filling of existing vacancies, including replacements for departing employees.”

A hiring freeze would temporarily reduce MCTS operating costs, as it is constantly onboarding and training new bus operators to keep up with attrition. It has to hire more than 100 new operators annually just to maintain its staffing levels. The system hired 110 new bus operators in 2024, just shy of its goal of 120, according to a spokesperson for MCTS.

However, a prolonged hiring freeze would also eventually lead to a significant decline in staffing, reducing the system’s ability to provide scheduled bus service. As Urban Milwaukee previously reported, understaffing and driver attrition leads to fewer hours of bus service.

The Amalgamated Transit Union Local 998 (ATU 998) has long told MCTS that the attrition is a morale problem. Bus operators work long work weeks, sometimes seven days in row; they face mandatory overtime; and work split shifts that extend a driver’s workday into 14 hours. They also, at times, face disrespect and assault, which is why ATU pushed MCTS to invest in better transit security. In 2024, MCTS created a new security team.

MCTS declined to tell Urban Milwaukee how many bus operators the system currently has. ATU 998 Vice President Michael Brown said the number is 735. Despite hiring achievements in 2024, the system continues to struggle to deliver its planned service. Brown receives a daily report on missed service. On July 2, MCTS missed 11 hours. “That’s because of attendance,” he told Urban Milwaukee.

The system is already stretching the limits of service provision. Since 2023, some of the bus operators aren’t actually regular operators. MCTS is using its mechanics part-time to help deliver scheduled service. All MCTS mechanics have a commercial driver’s license and a passenger endorsement, which is required by the U.S. Department of Transportation for commercial drivers transporting 16 passengers or more.

The union negotiated the mechanic driving hours in its last contract with MCTS in order to prevent the system hiring more part-time operators, Brown said.

Budget Deficit

Recently, MCTS told county supervisors that one in four riders were evading fares, costing the system as much as $4 million annually.

The system declined to share how it reached its fare evasion conclusion. The union has pushed MCTS in recent years to address fare evasion.

In the report from MCTS director Julie Esch and Corona, MCTS indicates the majority of the budget deficit is being caused by salaries and running over budget by $4.7 million; by a $3.4 million cost overrun in its contract with TransDev, the private company that provides paratransit services; $1.4 million less revenue than anticipated; $1 million over budget in materials and supplies; and $5,500 over budget in liability and workers compensation.

MCTS declined to answer some of Urban Milwaukee’s questions related to the deficit. A spokesperson said MCTS is not answering questions with any specificity, “Out of respect for the County Board’s legislative process,” and that it will wait to release further information until the next meeting of the board’s Committee on Transportation and Transit.

The report does state that, along with the hiring freeze and service cuts, MCTS is considering ending overtime except for Summerfest, working to reduce TransDev expenses and negotiating new prices with suppliers for parts and materials.

The system will also pay greater attention to the efficiency of its operations, and look for areas of improvement, according to the report. It also sees contract negotiations with the union as an area to lower costs. Specifically, “to reach an agreement that provides the right incentives to manage labor behaviors that lead to increased costs.”

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