Times Argus Retirement Incentive Story

Article published Mar 14, 2012
To avoid VSH layoffs, plan in progress
Plan in works to avoid Vermont State Hospital layoffs
By Thatcher Moats
MONTPELIER — The Shumlin administration hopes to offer cash retirement incentives to certain state employees in an effort to avoid laying off some of the 74 state mental health workers who are scheduled to lose their jobs next month.

The administration’s proposal still is in the works, but it is based largely on a plan enacted for state workers in 2009 during the recession, and it could mean payments of up to $15,000 for eligible state workers at the Vermont State Hospital who choose to retire, according to administration officials.

Jeb Spaulding, secretary of administration, said the retirement plan is a way to “soften the blow” for a workforce that faces layoffs because Tropical Storm Irene flooded the Vermont State Hospital in Waterbury on Aug. 28.

“You’ve got a group of people that are in a situation that’s no fault of their own, and you’ve got the state of Vermont that’s in a situation where it’s had to take some distasteful steps that we had no choice in taking, and in order to actually make sure the employees are protected as much as they can be, this retirement incentive will help,” said Spaulding.

About 25 or 30 senior-level workers with the Vermont State Hospital who have not received layoff notices would be eligible for the retirement incentive. If those employees take the incentive and retire, it would open a position for a worker who has received a layoff notice, potentially avoiding a layoff.

Lawmakers and the administration are under a tight timeline because the 74 workers are due to be laid off April 13.

Officials plan to insert the retirement incentive into a bill that will overhaul the state’s mental health system and calls for a new, smaller state-run mental health facility in Berlin.

The House and Senate have passed similar mental health system bills, but a conference committee of lawmakers from both chambers is reconciling the differences in the two pieces of legislation.

Sen. Claire Ayer, a member of the conference committee, said she believes the retirement incentive will win unanimous support from the committee because lawmakers “want to do right by the Vermont State Hospital employees.”

“I’m assuming they’ll come up with something we can afford and it will leave them in a better position, and my guess is it will be unanimous,” said Ayer, an Addison County Democrat who is chairwoman of the Senate Health and Welfare Committee.

Officials said Tuesday they did not have an estimate for how much the incentives would cost the state, but they said it’s affordable.

“We’ve done the cost analysis of that, and we think we can make those numbers work,” said Vermont Treasurer Beth Pearce.

The administration is planning to use general fund money to pay the incentives rather than dip into the pension fund.

Officials point out there are costs to be saved by avoiding layoffs, such as not paying unemployment benefits to former state hospital workers and by retaining lower-paid employees and having senior-level employees retire.

The Vermont State Employees Association, the union representing state workers, is collaborating closely with the administration as it hammers out the final details of the retirement incentive.

Conor Casey, legislative affairs director for the VSEA, said it won’t prevent all of the layoffs.

“But even if we can preserve a few positions with this, it’s definitely worth pursuing,” he said.

When the Shumlin administration announced the layoffs last month it was estimated 80 employees would be affected, but the number of employees facing layoffs ended up being lower.