The Virginian-Pilot
©
CHESAPEAKE
SPSA, the financially reeling regional waste authority, is laying off 29 employees this week and 13 more next month as part of an effort to cut costs and reduce its overall work force by 15 percent.
The layoffs, along with others in November that took effect in January, will save the Southeastern Public Service Authority about $3 million through unpaid salaries and benefits, said Tom Kreidel, an agency spokesman.
Launched in the 1970s, SPSA has handled most trash and recycling in South Hampton Roads for the past 30 years. Today it is struggling to survive, owing more than $240 million and facing a $16 million deficit this year.
A total of 68 employees will lose their jobs, Kreidel said. The cuts are hitting almost all areas of the agency - in administration, recycling, operations, at garbage transfer stations across the region and at the main trash sorting plant in Portsmouth.
All affected employees are eligible for severance, receiving one week of pay for every year of service, up to a maximum of 26 weeks, according to SPSA policy.
The job cuts were not publicly announced by SPSA but were confirmed by the agency when asked by The Virginian-Pilot.
Kreidel said SPSA's board of directors was briefed about the layoffs Wednesday morning during a closed-door meeting in Chesapeake.
The board did not have to approve the pink slips, he said, and therefore took no action. The board did not discuss the layoffs after emerging from the private meeting to vote on other matters in public view.
One worker who contacted The Pilot this week said she was laid off Monday - after finishing her shift.
"It's not fair," the former employee said, declining to give her name for fear of losing her severance. "They were going to cut our hours back to 32 a week. But then, bang, they told us we were out."
Eight of the employees lost their jobs when SPSA closed its yard-waste-handling center in Virginia Beach. Those layoffs were announced in November but did not take effect until January, as the center remained opened temporarily, Kreidel said.
The facility has since closed, and several pieces of equipment are being auctioned on an Internet site.
Kreidel said yard-waste recycling is the only service that has been completely cut because of the layoffs.
"Our goal is to provide that same level of service, utilizing the creativity and leadership throughout our organization," he said.
At its zenith, SPSA employed more than 500 people.
Through early retirements and unfilled positions, the agency has trimmed its work force to about 465 over the past two years.
When the layoffs are complete by the end of March, the SPSA work force will dip below 400.
About 40 percent of all employees work at SPSA's waste-to-energy power plant in Portsmouth, where garbage is burned and converted to steam and electricity. The plant is up for sale. Anticipated proceeds, estimated at nearly $200 million, are expected to draw down SPSA's enormous debt load.
The top two bidders, private waste companies, have pledged to keep as many workers as possible, though layoffs have not been ruled out by either.
Scott Harper, (757) 446-2340, scott.harper@pilotonline.com
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A House Divided
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.
Just to clarify
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.
Weakest link
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.
Good thing
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
SPSA
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.
Durwood Curling
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.
Virginia retirement system
what's this?
ychtfish your a moron
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.
SPSA
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.
1st grade math
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.