By Michael Raffety
Mountain Democrat, 3-23-12
Employees of the El Dorado Irrigation District have agreed to shoulder more of the health care costs, saving the district $430,000 in 2013, according to Human Resources Director Victoria Hoffman.
Additionally, five vacant positions are going unfilled this year for a savings of about $500,000 through the rest of this calendar year, according to Communications Director Mary Lynn Carlton.
The newly signed agreement with the employees, announced March 12, cuts EID’s health expenses 10 percent, according to Carlton.
Hoffman said the benefit changes still allow the district to be competitive in attracting top quality employees, but will reduce operating costs permanently. Employees with dependents will now pay 10 percent of that portion of the medical and dental plan. The district uses CalPERS for its medical insurance, but benefits funded by the district are based on Kaiser rates, the lowest cost health maintenance organization within the district’s Zip Code.
Additionally, retirees will pay 10 percent of the cost of adding their spouses to the plan.
The changes are detailed in a formal Letter of Understanding that is pegged to the Memorandum of Understanding with various employee groups. The LOU goes into effect Jan. 1, 2013.
A recent change in the MOU created a more stretched out vesting period for retiree benefits. The Letter of Understanding added medical benefits to this revised vesting schedule. State law requires the district to provide retiree health care, referred to as Other Post Employment Benefits.
To become 100 percent vested requires 20 years of service. The minimum vesting period is 10 years with at least five of those working for EID. The 10-year minimum gets a retiree only 50 percent of the benefits. The scale goes up to 95 percent for 19 years.
“All our employees understand our need to save costs,” said General Manager Jim Abercrombie. “To all employees I’d like to say, thank you.”
“I want to congratulate the employees,” said former director Harry Norris. “I’d like to see the employees take a full share of retirement (medical costs).”
The LOU on medical benefit changes was approved unanimously by the board.
Failing to get a vote other than 3-2 vote to table it was Director Alan Day’s request March 12 that the GM report back in 90 days with a plan to cut $1 million in the 2013 budget year and $1 million in 2014.
Director George Osborne joined Day on the losing end of the motion to table the request.
“Did you discuss this with the general manager?” asked Director John Fraser.
“Feb. 13 I reported savings. We have already achieved $1 million by and large,” Abercrombie said. “Potential savings in 2014 is a little hazy. In regard to conversation with Director Day I discussed what the board has directed me to do.”
Abercrombie added that in one two-month period, 62 jobs were eliminated and 31 pink slips issued.
“I really want to compliment the employees, who really think of ways to save money,” Abercrombie said. “Recognizing every year since 2007 we came in under budget, I want to compliment the employees.”
“I’m deeply concerned about continued cutting,” said Director George Wheeldon, adding at some point some vital operation will not get done.
Wheeldon noted that Sacramento Regional Sewer District recently had to pay the California Sport Fishing Alliance $600,000 for sewage spills.
“You want to lay off the Vactor truck (which cleans out sewer lines)?” Wheeldon asked Day. “It’s a slap in the face. It’s just to make you look like a white knight on a horse.”
“This is just a study,” said Osborne. “If we are at rock bottom, so be it.”
“This is just an affirmation of what we’ve been doing. It’s kind of redundant,” said Director Bill George. “Our responsibility is to provide reliable water.”
“Where do you get $2 million?” Fraser asked Day. “This is just a backdoor way of doing things. I propose we table this.”
Wheeldon seconded that and the motion to table was ruled by District Counsel Tom Cumpston as taking precedence over a previous motion to have the GM study Day’s proposal.
“I’m certainly sensitive to George Wheeldon that one thing suffering is preventative maintenance.” Fraser said.
“I think it is unfortunate to go there on scare tactics — ‘Oh, we’re going to have bad water.’ If we can put together Prop 218 (rate increase notice) for five years, we can (budget for five years). The goal is to continue the conversation. I think it’s a reasonable starting place,” Day said.
“Quite frankly, I feel like this is a feel-good thing. We’ve been doing this (cutting expenses),” Wheeldon said.
“What you say is fine,” Fraser said. “These are not goals, as I see it.”
“It’s a matter of semantics,” Osborne said.
“Where are you on your budget process?” asked Norris. “It should be part of the budget process. It looks like a budget committee task. Do ad hoc budgeting and it’s going to be chaos. If it is not part of the budget process, it should be tabled.”
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