Las Vegas Sun

March 6, 2015

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Buyouts will save $6.8 million, layoffs aren’t off table

Fifty-seven longtime Henderson employees will take a buyout offer in a move the city expects will save it $15 million over the next five years.

But city officials will not know until next month whether it will be enough to avoid layoffs.

The total represented 18.5 percent of 308 eligible employees and exceeded the city’s projection that 15 percent would accept.

The 57 employees carry an annual cost of more than $6.8 million in salary and benefits.

Members of Henderson’s police and fire unions still have until March 9 to consider the offer, and the city is expected to determine by the March 17 City Council meeting whether layoffs will be necessary.

The city announced the voluntary severance program in December as part of a five-year plan to maintain a balanced budget through what it projects will be lean years. Henderson has forecast a $53 million revenue shortfall for current budget year, which ends in June.

“Within nine to 12 months, we will save the cost of the program, and within five years, we will save the city $15 million,” City Manager Mary Kay Peck said.

The council has already accepted a plan to reduce expenditures by $22 million and cover the remaining $31 million through a combination of using reserves, altering pay structures and other measures.

To be eligible for the buyout, an employee’s age and years of service to the city, when added together, had to be 65 or greater. The severance package included two weeks pay for every year with the city and up to three months of health care coverage.

Any position opened by the buyout will be reviewed by an internal committee, which must determine that it is critical before it can be filled. If a position is deemed critical, she said, the city will first try to promote from within.

“What we’ve found is that most departments are handling it internally and not coming forward (to the committee), but instead saying, ‘We can live without this position,’” Peck said.

Finance Director Steve Hanson was one of the employees to accept the buyout.

“I was getting close to being able to retire anyway,” Hanson said. “I was starting to get involved with employees in my department about succession planning, and then this offer came up and the timing was right.”

Hanson, who has been with the city for 24 years, said it was a difficult decision because of the relationship he has formed with fellow employees, but he was pleased to see the buyout program exceeding expectations.

“I think it’s working the way the way we want it to,” he said.

The city has 161 vacancies — an 8 percent reduction in its staffing level, Peck said.

Hardest hit has been the Development Services Center, which processes building permits and related applications. At its peak in 2004, the center had a daily average of more than 400 applications in its queue; that number has fallen to about 200.

Peck said the city has reduced the center’s staff from 158 full-time employees to 101 through a combination of buyouts, transfers to other departments and billing their work to outside sources.

Eleven more positions will need to be reduced, Peck said, and that those 11 employees will be considered for vacancies created by the buyout program.

Councilwoman Gerri Schroder said the city has made difficult decisions, but is pleased with the results thus far.

“We don’t like to have these kinds of conversations, but at least we have a plan,” she said.

Jeremy Twitchell can be reached at 990-8928 or [email protected].

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