The AC Transit Board of Directors announced on Friday that it had reached a collective bargaining agreement with three employee groups, resulting in more than $7 million in savings.

The decision will result in the groups contributing 10 percent of the cost of their monthly medical and dental insurance premiums and receiving one fewer paid holiday. Discussions regarding the budget process have been in the works for at least a year, according to Interim General Manager Mary King.

“I recommended the decision because it was the only way to live with our means and be sustainable,” King said.

The three groups affected by the actions include the International Brotherhood of Electrical Workers, Local 1245; the American Federation of State, County and Municipal Employees, Local 3916; and unrepresented employees.

According to a statement released Friday, AC Transit will implement work schedule changes for IBEW, which represents approximately 25 electricians, electronic technicians and other specialists.

AFSCME — which consists of approximately 200 managers, professionals, supervisors, and administrative staff — will face wage reductions of 5 percent through June 30, 2013, for total district savings of about $5.8 million. Wages for unrepresented employees will also be cut by 5 percent, according to the statement.

“I don’t think that with a situation like this anyone leaves totally happy, but hopefully no one leaves completely upset either,” said AC Transit spokesperson Clarence Johnson. “It’s been clear not only with AC Transit but with organizations all over the country that given our economic times, labor groups to some extent will have to bear a bigger share of some of the financial burden, particularly in regard to health care costs and benefits.”

Johnson said that while the current contracts with the employee groups are set to last for two years, if there are state cuts to public transit, “there will be more talk about what can and needs to be done to keep us viable.”

Employees are not the only ones affected by the need to reduce costs. AC Transit fares were also raised Monday by a dime for single ride adult fare and a nickel for senior, disabled and youth fare. AC Transit Director at Large Chris Peeples said that the projected revenue from fare increases is $2.4 million for 2011 and 2012.

Peeples added that the Metropolitan Transportation Commission is working on a transit sustainability project that may help AC Transit in future planning.

“Caltrain almost shut down, Muni, everyone’s got problems,” Peeples said. “It’s good that somebody is out there spending money on planning and looking at all that stuff. That is something that we at AC use to try and figure out what we’re going to be doing in the next 20 years.”

This is not the first time AC Transit and the district have taken steps to cut costs. According to the statement, bus service was reduced in March last year by 7.8 percent and a second time in October by 7.2 percent for total savings of over $21 million.

Additionally, more than 70 general and administrative staff positions as well as a third of the executive staff positions were eliminated. The board of directors also cut its salary by 5 percent, travel by 50 percent and eliminated a special travel account for transit advocacy.

“These are some very turbulent economic times,” Johnson said. “Public agencies like ours are looking for ways to reduce costs so we can continue to provide high levels of service. Any time we can do that is beneficial.”

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