FY 2012 Operating Budget and FY 2013-2017 Financial ... - Septa

Fringe Benefits
Fringe benefits are a major expense for SEPTA representing 27.4% of the Fiscal Year 2012
operating budget of $1.23 billion. Responsibility for management of fringe benefit costs rests
with all Authority departments; however, the Employee Benefits, Public and Operational
Safety, Labor Relations, Legal and Finance Departments take the lead in cost control.
Authority expenditures for fringe benefits are largely controlled by statutory and contractual
obligations, and significantly influenced by national trends in the cost of health coverage.
These costs may be divided into the following categories:
• Medical and Life Insurance – SEPTA provides medical, prescription, dental,
vision and life insurance benefits for union and management employees and
retirees in accordance with the labor agreements negotiated with each respective
union.
• Payroll Taxes – This represents the required employer contribution for Social
Security (FICA) and Railroad Retirement Taxes (RRT).
• Unemployment – SEPTA is required to pay into the State and Railroad
unemployment compensation funds. SEPTA is self-insured for non-railroad
employees.
• Pension – This includes pension obligations, excluding Railroad employees who
are covered by the Railroad Retirement System.
• Workers’ Compensation and FELA – An obligation to employees injured on
duty for their medical bills and lost wages.
Fiscal Year 2012 Operating Budget
Fringe Benefit Expense
(Amounts in Thousands)
Medical, Prescription, Dental, Vision & Life $ 188,644
Payroll and Unemployment Taxes 60,591
Pension 88,570
Workers' Compensation and FELA 28,359
Subtotal $ 366,164
Capital Support and Projects * (29,036)
Fringe Operating Expense $ 337,128
* The net fringe benefit cost of $337.1 million includes a credit for the portion of employee
benefits applicable to capital project labor. For management oversight purposes, the fringe
benefits budget is tracked separately from departmental labor. A fully allocated net labor and
fringe benefits budget appears on the following page.
SEPTA Fiscal Year 2012 Operating Budget 139