Date:

December 7, 2007

For More Information Contact:

Diane Gonzolas, Citizen Information Center, 441-7831

Don Taute, Personnel Director, 441-7888

Don Herz, Finance Director, 441-7412

Mayor Chris Beutler today announced two early decisions in the 2008-2009 City budget process: a hiring freeze effective immediately and implementation of a new retirement incentive program for the next fiscal year.

Mayor Beutler said the steps are necessary as part of his two-year plan to right the budget. Upon taking office earlier this year, the Mayor cut millions of dollars in City spending and signed a budget for the current fiscal year that ultimately eliminated 63 positions. He said the success of last year’s hiring freeze and retirement incentive program convinced him that the steps were necessary to complete his overhaul of the City budget. Last year’s early retirement incentive program led to the retirement of 47 people and a net savings of $1.2 million per year.

“The retirement incentive and the hiring freeze help us reduce expenses and create re-organization opportunities for a more efficient City government,” said Beutler. “These efforts save taxpayer dollars and help us avoid lay-offs of City workers. It’s the right thing to do.”

City employees are eligible to retire if they are age 62 or if they are age 55 with 20 years of service. Under the retirement incentive program for the current fiscal year, eligible employees received $15,000 into their Post-Employment Health Plan (PEHP) and an additional 15 percent of their accrued sick leave. The new plan for those retiring by October 15, 2008 offers two tiers of benefits, depending on when eligible employees decide to retire:

• February 15 deadline: $7,500 to $17,500 to PEHP and 15 percent to 35 percent of additional accrued sick leave (depending on years of service).
• May 2 deadline: $5,000 to $10,000 to PEHP and 10 to 30 percent of additional accrued sick leave (depending on years of service).

“Receiving early retirement commitments is essential to my re-organization plans. The earlier we know someone is leaving, the better prepared we are to take advantage of the resulting savings,” Mayor Beutler said.

Mayor Beutler cautioned City employees that the 2008-2009 retirement incentive program would be the last opportunity for additional retirement payouts during his administration. “We cannot be in the situation where retirement incentive programs become an annual event. This opportunity will not be offered again during my administration.”

The hiring freeze means vacant positions are on hold until reviewed by a Hiring Review Committee. Only positions that impact public safety or are essential to City operations will likely be filled.

City employment is about 2,163 FTEs (full-time equivalents). About 95 percent of City employees are represented by one of six unions: Amalgamated Transit Union, Local 1293; Lincoln City Employees Association; Lincoln Firefighters Association, Local 644; Lincoln “M” Class Employees Association; Lincoln Police Union; and the Public Association of Government Employees, Local R9-38.