City pays $1.8M in retirement, health benefits to cut budget
The city of Colorado Springs paid more than $1.8 million in cash and health benefits to 89 city employees under a voluntary retirement program last year.
Facing an initial $24 million budget shortfall in the 2010 budget, the city in September offered the program to reduce payroll costs and avert some layoffs.
Nearly 100 employees expressed interest in the program, and 89 were approved.
Each retiree who participated in the program received an average of $20,637.
The city doled out $1.25 million in cash, $437,000 in health insurance for 12 months of coverage for “eligible employees” and $150,000 for retirees who chose cash instead of health insurance, according to documents obtained under an open-records request.
The Parks, Recreation and Cultural Services Department lost 28 employees under the retirement program, more than any other department. It was followed by the Streets Department with 12 employees, police with nine, community development with eight, and fire and economic development with six each.
The longest-serving employee who participated in the retirement program was James Bielz, a parks maintenance technician with 41 years of service.
The city paid Bielz $20,525.
The highest payout was $23,856, collected by 15 employees, including former Assistant City Manager Mike Anderson, who worked for the city for a quarter-century, and police officer John Kaufman, a 36-year city employee, documents show.
The retirement program “provided eligible employees a cash incentive equal to 10 percent of their annual base pay rate, plus 1 percent annual base pay rate for each full year of city service, not to exceed $15,000,” according to the city.
“In addition, eligible employees had the option to continue health insurance coverage for an additional 12 months after separation or choose an additional cash incentive in lieu of extended health insurance coverage, not to exceed $5,525,” the city said.
City spokesman John Leavitt said Friday the program generated $3.1 million in savings, or $1.3 million in net savings when the $1.8 million in costs are factored in.
The savings include “salaries we won’t have to pay because the positions are being held vacant for 12 months (and) savings we won’t have to pay in unemployment costs because 22 positions targeted for layoffs actually took the early retirement instead,” he said in an e-mail.
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