SPSA laying off 42 workers in effort to cut costs

Yes, that is what a good board is supposed to do and frankly, in the last five years or so, the board attempted to reverse the mentality of keeping the tip fee as low as possible. The board adopted new policies to finance projects at no more than 75% of value, and to pay it off at 80% of the asset's lifespan, to use pay as you go financing, to set up reserve funds for known future expenses, and to reduce the workforce since our productivity had increased so much. But when push came to shove, the members, most of whom sit on their city council, did not vote to adopt a tip fee sufficient to fund the policies that were set. Then Chesapeake sued, and the organization was a house divided, and the problem went from bad to worse. The new bill awaiting the Governor's signature will replace elected officials with business people, but the city council's must still instruct their representative on the tip fee, so this bill is not a panacea.

Lest anyone think otherwise, I was not singling out Mr. Collins from Chesapeake. I don't see how a CPA, a bricklayer, shipyard worker, rock n roll singer, a realtor, or a professional politician would have any better luck pulling a rabbit out of this hat. It has always been my understanding that a good board looks out for the best interests of the company they sit for. I do not see how that's possible for eight people who's primary interest lies not in the company but, rather in the various cities that put them on that board.

Well, that is not the worst of it. SPSA is totally at the mercy of its members to approve a tip fee sufficient to pay the cost of operations, debt service, and a margin of safety. Since Chesapeake sued SPSA to get out of its obligations, and lost in Circuit Court, we now have a member that is intentionally attempting through legislative means to accomplish what it could not do in the court; that is, change the agreements that every city signed in favor of new agreements that shift its obligations to other members. So if it is true that an organization is only as good as its weakest link, SPSA not only has a weak link, it has a member who has worked for its demise, and it may just be successful in forcing it to fail. Regretfully, the employees are paying a good part of that price even though most competent observers believe that the operations are efficient and effective.

It's a good thing for SPSA and anyone who sits on that board that most people "... base[d] their opinion strictly by what they read in the Pilot" and don't "... have a clue about the actual situation" Otherwise, most folks would have a very hard time finding a more messed up situation. One, I think, that exemplifies the reasons we have such a difficult time doing anything as a region. How can anyone realistically expect SPSA to be anything but a mess when any private company would consider most board members unqualified to offer an opinion. I don't intend any personal offense but, for example, what exactly qualifies Bryan Collins to sit on the board of what would be a multi-million dollar company? Nothing! Any random person of the street would be likely be as qualified. It does have to be dealt with and there's no escaping that but, I pity anyone involved. I'm sure it's a thankless job. Only 20 yrs; Cradle to grave. RIP

Response to the employees that work for this crocked company. The employees make about the same as the city workers. Now as far as the management they are the ones that needs to have salaries cut. It is hard enough to find a job now. The employees work hard and have at times worked over 12 hours a day no lunches no breaks and very little appreciation form the upper management, yet they hang in there continueing to do there jobs. Now being told that are being let go due to downsizing and budget cuts.As one reader said she was told her hours were going to be cut. And then in the next breath was told her job was gone. Just like the rest of us that have been let go during this recession we all have given it all to our employers this is the thanks we get for our dedication. face it alot of jobs could of been saved if only managenet would have taken a cut in pay. Like that would ever happen. The only thing that is clear I admire all of SPSA'S employees they work hard for all of us. If you see someone that has of works for this company, shake their hands let them know we are all with them. I know alot of these blue collar workers personally, and admire everyone of them.

ah -- a name from the past. I'd forgotten about him. What a guy he was, too [although I knew in a more informal setting]. Yes, I'd agree SPSA went crooked after Curling left. He was top notch.

what's this?

If you put your first grade skills to work and read the article you would see that the total number laid off is 68 which when you divide that number into the 3 million is a little over 44K which includes the cost of salaries, employer paid benefits, employers share of social security and medicare taxes along with the contribution to the Virginia retirement system. Quit believing everything you read in the pilot.

Most of the employees let go are making no where near as much money as this story indicates. This is a another case of SPSA managemen "cooking" the books. If you remember only 8 employees were let go in round one not 26, the other jobs that were on the books but not filled. So unless someone was collecting those pay checks (commonly referred to as no show jobs) the "savings" of not filling those postions does not really save any money, the money is just not carried on the operating budget.

any way you cut it, $3,000,000.00 divided by 42 = $126,000 a year each. Now, I don't what the average employee earns, even with benefits, as a refuse collector, but that is serious $$$$$$. No wonder SPSA is always in the red. The entire management should be the 1st to go & then put the operation up for bid to true profit seeking business professionals.

I think its about time they bring in a Tony Soprano “consultant.”

Mike B. presents another great “smoke and mirrors” analysis as always.

Well, everybody has a point of view. I am struck by the paucity of balance in the news coverage; if one based their opinion strickly by what they read in the Pilot, I don't think they would have a clue about the actual situation. That said, a lot of what has motivated so called insiders to offer criticism, that then gets reported as fact, is based upon a desire to reduce their financial liability. Chesapeake actually sued SPSA, and if they had won, their obligations would have had to be assumed by others. They lost in circuit court, but in my personal view, have continued their campaign to shift their obligations to others via legislative and internal tactics. Ironically, their SPSA delegates had voted with the majority in the past to provide a tip fee inadequate to fund operations and debt service as required by the statute. In the end, I hope the short term crisis is resolved so that the long term strategy of disposing of assets can be completed.

Somebody sounds almost defensive but, they do bring up a good point. Who should we believe when it comes to SPSA? Not the Newspapers. Not SPSA. Certainly not SPSA's Board of Directors. The various cities might be a little biased. How about Virginia's Auditor of Public Accounts? They had some interesting observations regarding SPSA. Maybe Covanta and Wheelabrator or would they be biased also? What do you do Mr. Barret, that you are privy to the little facts you shared with us in your post?

A good rule of thumb is it costs double someone's take home to employee them. Some of its benefits but a lot of it is various government mandates and taxes. It's all designed to not show up on your pay stub so you don't see how much the government really takes.

And then promptly punished for the bad business practices of management and the Board of Directors - past and present.

well if these employees are so wonderful why lay them off? Why not let upper management - that most likely hasn't lived paycheck to paycheck - go. that'll save money.

this is what happens when companies are mismanaged - the little guy gets the shaft and the same nincompoops keep mismanaging. SPSA's problems cannot be blamed on the economy.

Actually, the total number of layoffs in three phases is 68, and the $3,000,000 figure includes benefits as well. Most of the SPSA employees are hard working blue collar workers who drive trucks, heavy equipment, man weight stations and operate heavy industrial equipment in a challenging environment. They have participated in a remarkable increase in productivity over the last decade, and yesterday, in the presentations by Covanta and Wheelabrator, were complimented and welcomed as employees of either firm if that firm is selected to buy the RDF/WTE plant.

The money saved isn't just on salaries. There is overtime, medical benefits, vacation, training programs, etc.

My employer pays over $18,000 a year in my medical benefits alone!

Think before you do your equations...

It was only after Durwood Curling's retirement that SPSA started heading south. How did this organization get itself into this situation? Accountability has to start at the top. Most of the original SPSA executive staff are long gone. The SPSA Board of Directors has some tough decisions to make. Because of the mis-management of some, many blue collar, hard working employees are being laid off. Where is the justice in all this?
It's a sad day in South Hamptons Roads. At one time not too long ago, SPSA had an impecable reputation and was providing a great service to the region. At one time, major metropolitan areas across the country looked to SPSA as the model to follow. No more. What has happened to SPSA is a total embarrassment and those who are responsible should be be held accountable for their actions.

That's over $71,000 a year. For trash! Boy, have I been working for the wrong company. Any wonder why they can't make it?