As the initial SMART Transportation Division convention will be held in 2014 – one year earlier than a UTU quadrennial convention that no longer will take place owing to the merger – plus a second SMART convention, UTU delegates are being asked to approve a $1 monthly International dues increase to be deposited into the convention fund.

The increase, if approved by delegates, will become effective Feb. 1, 2013.

Delegates will be participating in two conventions in 2014 – the Transportation Division convention and the initial SMART convention.

In a letter to UTU delegates, UTU International President Mike Futhey said:

“Not only will the time between the 2011 UTU convention and these conventions be reduced from the usual four year period, delegates will be participating in two separate conventions in 2014. Obviously, the total expenses are expected to increase substantially and available funds will be insufficient due to the shortened time period.

“As a result, the UTU Board of Directors voted to present to the delegates the $1 dues increase to be placed in the convention fund. The UTU board said it is their recommendation “to adopt the needed increase assuring your voice will be heard.”

Delegates have until Nov. 30 to return their ballots.

By General Secretary & Treasurer Kim Thompson

Just as you balance your personal checkbook and compare income to expenses in making decisions where to spend and where to save, we at UTU International make similar decisions with your dues.

Accepting responsibility to protect the interests of our members also includes accepting responsibility to use the funds entrusted to the International so as to obtain the most value from every dues dollar received.

There is no silver bullet for managing finances. Resource utilization is regularly assessed and needed adjustments are made. Demanded action is met with a cost-effective response. This same standard is applied to funds managed for the Discipline Income Protection Program and the United Transportation Union Insurance Association (UTUIA).

During the current administration, the UTU’s General Fund, accounting for most day-to-day operations of the International, has increased from $2.1 million to nearly $2.6 million.

The balances of all other funds have improved by an even greater extent, with the total of all International funds increasing from $7.5 million to nearly $16 million — an increase of 111 percent.

The Convention Fund balance assures that necessary funds are available to finance the 11th Quadrennial Convention convening in August.

This is all in spite of reduced membership owing to the deep recession and employee layoffs, and extraordinary administrative and legal expenses.

In 2007, our Discipline Income Protection Program reserve fund suffered a $2 million loss and was left with a balance of just over $5 million. Today, our reserves are at more than $9 million, assuring sufficient funds to satisfy all outstanding liabilities and provide the protection our members expect and deserve.

The UTUIA, meanwhile, earned more than $400,000 from operations during 2010, and remains financially strong with nearly $26 million in surplus.

Union assets are invested primarily in cash accounts and short term bonds, and are largely unaffected by the stock market problems.

The UTUIA, as all insurance providers — and even the Railroad Retirement Trust Fund — has assets invested in the stock market, as well as in bonds and cash accounts. But UTUIA investments are generally conservative in nature. UTUIA investment advice is obtained through independent advisers who have no financial benefit from actual transactions, but are paid on a fee-for-service basis.

Prior to this administration assuming office, it was said that the UTU was broke and could not survive on its own. In addition to precariously low reserves, our nation fell into the worse economic recession since the Great Depression of the 1930s. During the depths of this recession, more than 15 percent of our members were furloughed.

Disciplined finance management by this administration enabled continued growth.

Now, as the railroads recall employees and hire new workers, the resulting increased receipts will add to these reserves, assuring availability of funds for continued quality representation.

The National Railway Labor Conference (NRLC), in an April 1 letter to the Sheet Metal Workers International Association and its General President Mike Sullivan, has recognized the requirements of status quo under the Railway Labor Act and said all carriers will continue remitting UTU member dues to the UTU.

“The deduction and remittance of dues are governed by the requirements of Section 2, Eleventh of the Railway Labor Act [which] requires railroads to deduct and remit dues in accordance with union security provisions contained in collective bargaining agreements and written authorizations from individual employees authorizing the deduction of dues from their pay,” said the NRLC.

In addition, said the NRLC, the carriers recognize that there is additional merger-related litigation pending in the U.S. District Court for the District of Columbia.

By Kim Thompson
UTU General Secretary & Treasurer

Nobody spends someone else’s dollars as carefully as we spend our own.

The UTU International leadership is especially sensitive to the fact that members entrust us with their own hard-earned dollars, and every member rightfully expects their union to gain the most value for their dues money. We do not take this obligation lightly.

Since taking office in January 2008, we have instituted new cost controls and conservative investment policies that, even in the face of significant furloughs by rail carriers and problems in financial markets, have made the UTU more efficient and financially secure.

The International’s General Fund, as detailed in the most recent GS&T report, has grown since the Futhey administration took office almost 18 months ago — from $2.1 million to $4 million, which is a 90 percent increase.

The General Fund pays for International operations, including employee wages and benefits, travel tied to assistance provided general and local committees of adjustment, and headquarters rent.

Separately, our strike fund has grown by 45 percent, to $2.7 million, and our convention fund is on track to have the necessary minimum on hand to pay traditional and contemplated costs of the eleventh quadrennial convention in 2011.

Total International funds have grown from $7.5 million, when we took office in January 2008, to more than $13 million, which is an increase of more than 70 percent. This is in the face of sharp carrier cutbacks of employees — many being UTU members — in response to a sour economy.

Among cost-cutting actions was the reduction of one full-time administrative officer in the Cleveland headquarters and redistribution of that work to headquarters staff and other International officers. We have gone from 15 full-time International officers to 11, which is more than a 25 percent reduction.

Travel expenses have been reduced by combining International officer assignments and assigning officers geographically closer to the committees they are assisting. Every travel expense is checked to ensure it is necessary and proper.

Our International funds are invested conservatively so they are available when needed without undue risk of principal.

Our investment advisers are paid directly for sound financial advice and do not profit by moving our money from one investment alternative to another, or as a percentage of short-term investment gains. As a result, our International finances have withstood the effects of this recession and associated financial calamities far better than most organizations.

The UTUIA, meanwhile, earned more than $300,000 from operations during the first quarter of 2009. The UTUIA remains strong with more than $23 million in surplus, as recently validated through an annual audit.

As for the DIPP, premiums exceeded claims for the first quarter 2009, which boosted the fund’s balance. We continue monitoring this fund, as claims are tied directly to the level of carrier discipline.

We have met — and continue to meet — with carrier officers to discuss what we consider to be arbitrary discipline that unjustifiably damages employee morale, impeding our ultimate goal of providing world-class transportation service.

At the local level, we are assisting local treasurers through workshops, individual assistance and the UTU University to better equip them to carry out their duties in managing their local’s funds.

The financial state of the United Transportation Union is strong and secure, and we intend to keep it that way through careful spending and improved productivity within every department and through every activity of the International.