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Vero water workers, not bosses, face cuts

STORY BY LISA ZAHNER, (Week of February 9, 2012)

While the notion of Vero Beach and Indian River County merging to provide water and sewer service has long made compelling sense to many barrier island residents, it turns out this also makes sense to the rank-and-file workers who keep the city utility running.

That's because rank-and-file workers will take the biggest hit in layoffs as the city cuts staff to keep its water/sewer utility afloat, while nearly four out of five administrative staff will retain their well-paying jobs.

If the county took over the city system, the opposite would be true with city water/sewer managers most likely to face the axe.

The proposed Vero Beach water-sewer "optimization plan," designed to make the city's utility competitive in rates, eliminates about a third of the department’s lower-level jobs, but leaves nearly 80 percent of the utility's administrative staff safe from layoffs.

The layoffs were to be phased in over about a dozen years, combined with increased automation at the utility plants, expansion of reuse water capacity and outsourcing of the environmental laboratory duties.

Over time, consultants predicted the efficiencies would keep the Vero Beach water-sewer utility solvent. Last month, it was announced that the timeline for implementing optimization – including the layoffs – would be five years instead of 12.

That new reality puts workers in a position where they might want to advocate merging the system with Indian River County.

At a recent meeting of the Teamsters Local 769 union, which represents the city’s non-management utility workers, a discussion reportedly arose among members dismayed the proposed outsourcing of lab tests would leave several of their co-workers without jobs with retaining the administrator in charge of the lab.

That administrator, John Ten Eyck, has been with the city for 33 years, is eligible for full retirement benefits and earns $101,000 per year.

The lab is not his only area of responsibility, but he does have a master's degree in chemistry and worked for many years as the top manager in the lab – a lab that will no longer exist as it does today if the city finds a good deal on outsourcing the required water testing.

According to the Florida Department of Environmental Protection, the Vero Beach utility has no real need of a lab – or a $101,000 per year chemist – if everything is sent to a lab that meets all the state's certification criteria.

"In Florida, laboratories conducting drinking water and wastewater analyses for compliance purposes are required under Chapter 62-160,FAC (the DEP Quality Assurance Rule) to be accredited by the Florida Department of Health's Laboratory Certification Program," said FDEP spokesperson Dee Ann Miller.

Miller said the certification program audits labs against national quality standards, which specify education and experience requirements for lab managers, personnel and systems that certified labs must have in place.

"The labs themselves are certified as institutions and training/experience requirements for individuals performing laboratory analyses are a component of the institution's certification," Miller said.

Indian River County already has labs that could handle all the testing for Vero's system if the two utilities merged under the county umbrella. Plus, the county doesn't need a $101,000 per year chemist. That's one of the many economies of scale that could be realized from a regional or countywide water and sewer system.

Indian River County Utilities Director Erik Olson said last week that his gut feeling about why top Vero staffers are pushing for "optimization" over "regionalization" is to save the jobs of managers and administrators, including Vero water-sewer Director Rob Bolton.

Bolton has railed against any discussion of merging systems with the county, except under some sort of utility authority where Vero would retain partial control – and partial management.

Olson said that if the county takes over the Vero water-sewer system as has been proposed, he would need meter readers, technicians who maintain the lines, pumps and lift stations and some customer service representatives.

The people who would lose their jobs under regionalization are administrators, managers and engineers because the county already has enough of those.

Olson had said he would most likely keep 35 to 40 of Vero's 71 utility workers. The "optimization plan" would keep between 40 and 50 people on to run a leaner utility.

"We would continue to use the city's reverse osmosis plant," Olson said. "And it would take about two years before we could shut down the wastewater treatment plant."

It would take that long to build the infrastructure to be able to decommission the plant and transfer the waste to the county's treatment plants. It then would take about six months to dismantle the plant. The county has said it would return the city a cleared parcel covered with sod on the south side of the 17th Street bridge for Vero to use as city leaders and residents see fit.

After the sewer plant was decommissioned, Olson said a good number of the sewer plant workers would have opportunities to stay with the county.

First of all, there would be more to do at the county's plants with Vero's wastewater flowing in. Secondly, there would be jobs open through retirements or promotions that could be filled by qualified city workers.

Olson said although he couldn't promise that employees hired by the county would retain 100 percent of their current salaries, the jobs would be full time with benefits. He said he and his staff would look at each individual's longevity and qualifications and start them off at an appropriate place in the county's pay structure.

The worst-case scenario for Vero utility workers would be set in motion should the Town of Indian River Shores choose the City of Vero Beach for its next 30 years of utility service.

Vero has promised to offer the Shores the same rates as Indian River County. That will reduce the revenue flowing into the system, as politics will force the city to offer all of its customers those same, lower county rates so city taxpayers won't be seen as subsidizing bills of Shores customers.

Those lower bills for Shores customers – and presumably everybody else on the Vero system – would kick in on Oct. 1. So, starting this coming fiscal year, Vero's revenues would be cut back somewhere around 20 percent. That means optimization becomes more critical. Employees will be cross-trained and the layoffs will begin.

When asked how he could justify laying off so many lower-level workers while keeping higher-paid management and administrative personnel relatively unscathed by optimization, City Manager Jim O'Connor said the positions slated for elimination in the GAI plan are not set in stone.

"In the five-year plan, the positions to be eliminated are not established but the number is. The positions that will be vacated are based upon the duties being performed -- not necessarily seniority although we will follow the agreed upon contracts with the unions," O'Connor said. "We will be addressing the administrative positions as well; in fact we have been in conversation to reduce the number of supervisory positions so it is being addressed."

When asked if he thought going from a 1 to 6 ratio of administration personnel to workers to a 1 to 4 ratio was the most fiscally sound way to create efficiencies in the utility, O'Connor responded, "No I do not think we should run the department with a 1 to 4 ratio."

A more dire situation for city utility workers might be what O'Connor has been talking about the past few months – selling the utility to a private company or bringing in a private company to it. To achieve any kind of profit margin and keep rates competitive, a private company would need to make the Vero system more efficient, meaning potentially more layoffs.

Mayor Pilar Turner, who came to office a staunch proponent of regionalizing systems with Indian River County, has tried to look at all sides of the water-sewer issue to find the best solution.

"I've always said that regionalization is the practical thing," Turner said. "We've got to get back to this conversation again on regionalization. Nobody wins with all of this territorial dispute."

Since being elected in November 2010, Turner has repeatedly pressed Bolton and other city staffers for financial analysis and solid projections with regard to how the water-sewer utility would manage if either the Shores, the South Beach or both were lost.

Answers have been inconsistent at best, from Bolton saying Vero would be better off with a stand-alone utility serving only customers within the city limits to GAI Consultants' convoluted 350-page "optimization plan."