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Insult to injury

Weeks after being laid off, city bus drivers are being taxed on money they never received



When City Council decided to halve bus service at the end of 2009, Dan Francis and his wife, Toni, were among the drivers that lost their jobs.

The layoff was a tough break for a couple who had put in decades of service and have a 10-year-old to support. But the Francises resolved to keep their chins up. Looking ahead about six weeks, they'd have pension payments coming to them, since they were old enough to qualify for early retirement. And in the meantime, there was their sick time; between the two of them, they'd saved up plenty, and they were assured they'd be paid the $11,000-plus it was worth.

But the first of the year rolled around, and the Francises didn't see any checks. A few weeks passed, and they received something else in the mail: W-2s indicating that sick leave had been paid. So not only was the couple hard up for cash, but they were being charged taxes on money they never received. The "increase" in income was enough to bump the family into another tax bracket.

"It's not right, what's being done," Dan says. "It's bad enough to shut down the careers of so many people that they've put decades into, but then not to pay the money that they have coming — that's really a slap."

Dan called the Internal Revenue Service, who told him the W-2s must be amended since the sick leave wasn't paid in 2009. But Dan's attempts to get a new W-2 from the city contractor that employed him have been unsuccessful. So now the Francises can't even do their taxes.

The situation isn't a fluke. Dozens of laid-off transit workers are going through the same thing. The problem traces back to a standoff between the city and First Transit, a contractor. When Councilors axed all those jobs and bus hours, they eliminated the transit contract that went with them. Now, the city and First Transit are haggling over unpaid bills associated with the former workers. Neither wants the responsibility of paying millions in pension obligations to the once-unionized workers. Nor do they want to pay about $300,000 in sick leave.

(There have long been tensions between the city and its transit workers. Lawsuits were filed over the years as the city sought to relieve itself of restrictions and obligations associated with the unionized workers. The city may have thought those hassles would end with the mass layoff last year, but that has not been the case.)

Ryan Hiatt, the former general manager of the First Transit contract, says his company has the sick-leave checks ready, but won't hand them out to workers — or amend W-2s — until the city pays the company. Hiatt maintains that the city contractually agreed to pay that sick leave, but city employees have ignored First Transit's invoices seeking payment.

The city, apparently, sees the situation differently, saying it has fulfilled its contractual obligations.

"There is a disagreement between First Transit and the city as far as who is responsible to pay for [sick leave]," city spokesperson John Leavitt says plainly.

The lawyers are duking it out, but Leavitt says he isn't expecting a resolution any time soon.

In the meantime, the Francises and their former co-workers haven't seen a check since Dec. 31.

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