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Albany rejects raises of nearly 27 percent for 3 NFTA executives

The chairwoman of the Niagara Frontier Transportation Authority quietly instituted raises approaching 27 percent for three top executives in December, two sources familiar with the situation told The Buffalo News.

But the hikes were declared dead at the State Capitol, where Gov. Andrew M. Cuomo’s staff considered raising the salary of Executive Director Kimberly A. Minkel by about $55,000 to $262,825, far too high as the state faces major fiscal challenges this year. Indeed, Minkel and two other top authority executives declined their new raises after feeling Albany's opposition, according to two Cuomo administration officials familiar with the situation.

“We didn’t think those raises were appropriate considering the authority’s and the state’s finances,” said one Cuomo administration source who asked not to be identified.

The pay hikes for Minkel and other top staffers were never authorized by the authority’s board of commissioners or publicly disclosed. But the administration sources say they were instituted by Sister Denise A. Roche, the NFTA chairwoman empowered by authority bylaws to implement salary changes.

A salary increase also was proposed for General Counsel David J. State from $152,000 to $193,961, or 27.6 percent, as well as for Chief Financial Officer John Cox from $130,000 to $165,000, or 26.9 percent. Minkel’s raise would have represented an almost $93,000 increase above when she was hired at $170,000 just over seven years ago.

The idea of pay raises was first raised in December, when a compensation study noted that the salaries of the three executives were well below those of other comparable transportation agencies.

Another administration source said Roche, the retired D'Youville College president appointed by Cuomo in 2016 to head the NFTA board of commissioners, settled on raises slightly smaller than figures that first surfaced in December from the consultant's recommendations.

While the two Albany sources acknowledged that the governor's staff nixed raises for top NFTA staff, Roche said in a prepared statement only that no raises were “received.”

“Senior staff at the NFTA have not received a raise,” Roche said. “Their compensation has been frozen for the past two years.”

The chairwoman would not discuss whether she took any steps to implement raises, if objections were raised by Albany or whether top staff had reimbursed the authority for any enacted salary hikes.

“I don’t see checks coming and going,” she said in an interview. “They do a tremendous job at the NFTA, and all this little stuff is like somebody trying to creep in and make things look bad.”

Although the NFTA has autonomy as a public authority, the majority of its board, including the chair, is appointed by the governor and Albany has a say in its funding.

Roche said she was aware of “rumors” about Albany’s concerns, but does not know where they would have received any information about salary hikes.

“I don’t report to them,” she said. “I’m the commissioner. I don’t call and tell them what happens at meetings.”

Nevertheless, the increases caused alarm within the Cuomo administration.

Roche told The News she agreed that because of the state’s budget challenges this year, “it would be inappropriate to make changes right now.”

Sources tell The News that there was no board vote approving the pay raises. Yet Roche cited concerns about protecting the secrecy of executive sessions when refusing a News request to supply information about the decision-making process that led to the raises.

NFTA salaries are public under New York State law, but Roche considers such information a “personnel” matter and would not answer questions about raises.

“If it’s public information, fine,” Roche said. “But not from me.”

The NFTA board did not vote on but supported a staff proposal late last summer for an authority-wide compensation study at a cost of $5,000, according to spokeswoman Helen Tederous. The resulting report, supplied late last week at the request of The News, showed NFTA compensation for its executive director between the 25th and 50th percentile of authorities operating surface systems or airports.

Citing the relatively low compensation ranking compared to other authorities, the study recommended NFTA should increase its salaries, especially since Minkel, State and Cox run a multimodal operation comprised of bus, rail, two airports, and police and fire departments.

“All three positions require the individuals in the position to man areas of knowledge and perform executive functions for two sectors, effectively managing a mid-sized public transit agency and a mid-sized airport authority simultaneously,” the report said. It cited last summer’s hiring of a former General Electric executive at $320,000 to run the much larger Massachusetts Bay Transportation Authority in Boston.

“These adjustments will move the authority into a more competitive position in the market of skilled labor for all three positions,” the report added, “and improve the probability that the authority would retain high-skilled individuals in these strategically critical positions.”

NFTA officials also point out that Minkel’s current $208,000 salary ranks below other upstate systems even while she runs much more extensive operations. They point to CEO salaries of $357,000 in Syracuse, $257,000 in Rochester, and $216,000 in Albany.

In contrast, the authority’s unionized work force last summer received its first pay raise in eight years when it ratified an 11-year agreement retroactive to 2009. Workers were set to receive 2 percent raises in 2018 and 2019, and an additional 2.25 percent in 2020.

In recent weeks Minkel has recognized Albany’s budget difficulties, telling authority commissioners last month that they pose a significant threat to local transit operations. The NFTA stands to lose $1.7 million in overall funding stemming from Cuomo’s new spending plan. She noted that while transit across upstate can expect a 1 percent increase in operating assistance in 2018-2019, funds for NFTA capital projects will decrease by $2.2 million in the authority’s $234.2 million budget.

“That makes it a challenge,” she said.

Minkel, who has a bachelor’s degree from Niagara University and an MBA from Canisius College, has experienced her share of difficulties with Albany since she was elevated from director of health, safety and environmental quality in 2010. Soon after her promotion and just before Cuomo took office, the governor-elect’s top transportation adviser on his transition team complained that the board had acted without consulting the incoming governor.

NFTA, other upstate transit agencies face state budget cuts

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