Bonuses may be history at Colorado Springs Utilities, but its employees won't be scratching the bottom of the barrel.
Under a new pay plan included in Utilities' $1.11 billion 2010 budget proposal, the city-owned agency's roughly 1,900 workers won't get a one-time bonus in April like they did for a decade. But their base pay will go up and they will be eligible for one-time payouts of up to 5 percent of their annual pay for outstanding service.
City Council, also serving as the Utilities board, abolished the bonus program, which cost up to $12 million a year, after it drew headlines for rewarding more than 95 percent of employees and padding the pay of top officials by $25,000 or more.
In 2009, the bonus program cost $10 million; in its place in 2010 is $7 million more for base salaries. Another $2 million to $3 million goes to the Star Awards program, which gives employees payouts ranging from a $100 gift card to 5 percent of base pay to reward outstanding service. The program limits an employee to $1,200 in Star Awards, plus 5 percent of base pay in one year.
"It will be a much more robust program," Councilman Randy Purvis says. "I think it's simpler. It's easier to explain."
He notes the change translates to a 5 percent across-the-board pay reduction, and that total salaries and benefits will fall by $600,000 next year.
According to a presentation obtained by the Independent, perks will sweeten next year when those with one to five years of service get 13 vacation days instead of 11, and those with more than five years get three additional days. The "compensation redesign" presentation, labeled "Employee Information Forums," also details better health care benefits, such as lower co-pays.
The vacation and health care changes caught Purvis and Vice Mayor Larry Small off-guard.
"If we haven't even heard of it, I'm surprised they'd be telling employees that," Small says. "I don't know that we need to be adding vacation time, that's for sure."
The 2010 budget isn't likely to contain a multi-year water rate increase of 12 percent per year from 2011 to 2016, as sought by Utilities, Purvis says, although that proposal could resurface next year. He says the idea has been sidelined to give the city auditor's office more time for analysis.
But the budget proposal calls for a 5.9 percent water rate increase in 2010 to generate more money for the Southern Delivery System, which will suck up $46 million next year as work begins toward pumping water from Pueblo Reservoir to Colorado Springs. The $1.5 billion project was conceived to supply the 20,000-acre Banning-Lewis Ranch subdivision and to provide "redundancy" to the city's existing system, parts of which date back 80 to 100 years.
Taken together, all four utilities — water, wastewater, gas and electric — will cost local customers 2.3 percent more next year, or $4.18 a month for the "typical residential" household. The $1.11 billion budget number amounts to $12.3 million less than this year's budget, due largely to declining fuel costs.
Gas charges on bills will go down by 13.1 percent due to market conditions, while coal and purchased power costs are projected to rise in 2010, Utilities spokesman Dave Grossman says.
City Council will take action on the rates Dec. 8. If adopted, they would become effective Jan. 1.