City passes 'retirement incentive program'


As an alternative to laying off 33 city employees, the city of Mountain View is hoping to encourage some to retire early. A set of incentives for early retirement were approved by the City Council without comment during Tuesday's meeting.

Under the $200,000 program, eligible retirees could receive $750 for every year worked for the city and would qualify early for retirement health benefits and a higher percentage of cash payout for unused sick leave. With city services already cut significantly last year, administrators hope to eliminate 33 positions in order to balance an ongoing deficit.

"We're trying to find ways to save dollars for the general operating fund," explained assistant city manager Nadine Levin. "If we could de-fund or eliminate a position for retirement that we are not going to refill, then that's a savings."

Retirements and layoffs will help fix a projected $5 million general fund deficit this June, city staffers say. The program would cost the city $200,000 in one-time funds, but would save the city much more in the long run, said Levin in a staff report.

A package of four incentives is being offered to city employees at least 50 years old who just need a little encouragement to retire this year. The proposed incentives are:

■ $750 for every year worked for the city, up to $15,000

■ Employees within two years of qualifying for the city's "defined benefit" retirement health benefits (it usually takes 15 years) at the end of July will qualify upon retirement

■ Employees within two years of qualifying for the next level of retirement health benefits at the end of July will qualify for that higher level upon retirement

■ Employees within two years of receiving a higher cash-out of sick leave will receive that higher cash-out upon retirement.

It is ultimately up to city officials whether to let an employee take the offer.

"Someone may find this a very attractive offer," Levin said. "But if their position needs to be refilled out of necessity, then that person going out is not going to save the general fund money."

Levin is filling in as interim employment services director after the retirement of Kathy Farrar last year — an example of the department consolidation the city proposes to achieve.

Employees who choose to take the deal cannot return to work with the city for a year. Levin reports that the city could not afford more lucrative "golden handshakes" for retiring employees as other cities have offered.

The $200,000 would come from a "budget contingency fund" which has a balance of $5.8 million.

While the program may increase certain employee benefit costs for the city in the next few years, Levin said that wasn't a concern.

"The individual would be entitled to the benefits ultimately anyway," she said. "We're just putting them in it two years earlier."


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Posted by Observer
a resident of Old Mountain View
on Mar 23, 2010 at 4:02 pm

Incredible. Just lay them all off. Only a government body would consider retiring someone as a way to save money rather than just laying them all off. Welcome to the real world government employees.

Like this comment
Posted by NeHi
a resident of Cuesta Park
on Mar 23, 2010 at 6:59 pm

Hmmm, is it really better to pay them to not work than to pay them to work??

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Posted by Former Airline Employee
a resident of Shoreline West
on Mar 23, 2010 at 7:44 pm

Look at the airline industry. When times got tough, jobs were cut and retirement packages slashed to almost worthless. Yet here is a city that can't bring itself to do the right thing by taxpayers, some of whom perhaps once worked for the airline industry.

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Posted by Old Ben
a resident of Shoreline West
on Mar 24, 2010 at 12:37 am

Just let them go.

Like this comment
a resident of Blossom Valley
on Mar 24, 2010 at 7:56 am

Only the government figures they save money by paying early retirement. Pay these 33 staffers off - give them overly generous retirement pay - and then let them go and double dip. Why not have them sign an agreement that says any income they make comes back to the city. If they're 'retired' then they should not be double dipping. Unbelievable - just keep stiffing the taxpayers. MV council should think of contracting out a number of services like San Carlos and others are doing - or cutting back all employees' salaries by 10% like San Jose is doing. Where's the leadership? Retirement pay is one of the biggest elements of the city budget - and it's only getting worse. It's time to bite the bullet and fix it - rather than making the taxpayer fund overstaffed, overpaid city workers.

Like this comment
Posted by Chebacca
a resident of another community
on Mar 24, 2010 at 9:46 am

Quit complaining and go apply

Like this comment
Posted by Ted
a resident of Cuesta Park
on Mar 24, 2010 at 10:34 am

MV taxpayers: If you don't agree with what YOUR city is doing with YOUR tax dollars, talk to your elected officals. If they don't respond to your fiscal concerns, vote for future candidates that will.

Like this comment
Posted by Steve
a resident of Old Mountain View
on Mar 25, 2010 at 2:35 am

Just a microcosm of the state and national governments.

Folks govt has almost zero incentive to be efficient (no competition) and maximum incentive to grow

Like this comment
Posted by duh
a resident of Whisman Station
on Mar 25, 2010 at 1:01 pm

I see a lot of commons from people that really don't know how a layoff process works. It works from the bottom up. Meaning the new employees that would be with us for several years would be laid off first. Yes, you save money that way but then when the senior person decides to retiree with their benifits they been working for 20 years then they get to go out the door and the city has to fill those positions and it doubles their cost because they just laid off those people already; therefore, you save thousands by having the senior person leave early with the incintive and you don't have to fill the bottom person. So think about the big picture because the city manager already has.

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Posted by taxpayer
a resident of Waverly Park
on Mar 25, 2010 at 2:57 pm

The bottom line problem is union contracts. Our government is being bullied into accepting these terms, and now we're stuck. What we really need is a lawyer to sue the unions under the racketeering laws so that all level of government can be free from these contracts that are holding us down. It does not make economic sense to pay government employee market salary rate, and provide life time pension. To make matter worst, many of these retired government workers are back out in the job market taking away another job that another individual without the pension income.

Like this comment
Posted by 10%er
a resident of Cuernavaca
on Mar 25, 2010 at 3:10 pm

Hey concerned taxpayer poster, that 10% is going to hurt us city workers and the residents of san jose if it goes thur. I am already the working poor.

Like this comment
Posted by Voters
a resident of Cuesta Park
on Mar 25, 2010 at 3:12 pm

The councilmembers that the tax paying residents vote for are the ones that approve the union contracts. Go talk to your councilmembers and make sure you vote. Stop complaining on MV Voice, does nothing.

Like this comment
Posted by Dave Williams
a resident of Waverly Park
on Mar 25, 2010 at 3:44 pm

The math on this is very straight foward.

As an example you lay off 33 employees who make for example $40K anually for a savings of $1320K or for $200K you can reduce your work force by 33 employees who after mutltiple years of service average $60k for a savings of $1980K which nets out a savings of over $400k year on year.

The more senior employess are going to retire in the future any how at the same retirement cost or more

The ongoing costs of keeping the less senior employees will be less year on year than the alternative.

From my perspective, I am going to talk to and exercise my vote perogative on the council members who don't support this action.

Like this comment
Posted by Robert
a resident of Old Mountain View
on Mar 28, 2010 at 5:18 pm

Consider this: in these tough economic times MV has spent close to $20 MILLION on land at Moffett and 101; close to $2 MILLION on a church on Escuela Ave; close to $10 MILLION on a new fire station by Shoreline park; and now $200,000 on high speed rail consultants? We're talking well over $30 MILLION DOLLARS on nonessential items. If this doesn't outrage you I don't know what will. Think about where the real problem lies before you bash city employees. Mountain View's "leadership" wants the citizens to believe it's Union contracts breaking the bank but in reality it's irresponsible spending and backwards priorities at City Hall. Don't believe the hype!

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