COLUMBUS — Seventy-seven Nebraska Public Power District (NPPD) employees will accept early-retirement packages effective April 30.
The voluntary retirement program — offered to 360 eligible, non-nuclear employees, excluding vice presidents — was authorized by the utility’s board of directors in February as a cost-saving measure. At that time, district officials hoped to save $10 million by leaving positions vacant or filling them with lesser-salaried employees.
While it’s unclear whether that projection will be met, NPPD Vice President of Human Resources and Corporate Support Roy Steiner said Tuesday the program puts NPPD in a “very good position” to meet 2012 budget targets.
“I think we’re pretty comfortable with the number that we got,” he said, adding that it wasn’t large enough to cause operational problems, but included enough employees to make the program worthwhile.
The 77 approved retirements represent 5.2 percent of NPPD’s 1,478 full-time, non-nuclear employees.
Early retirement was not offered to the 727 full-time employees at Cooper Nuclear Station near Brownville. Instead, savings there will be sought through contractor reductions.
As part of their incentive package, each outgoing employee will receive a lump-sum payment equaling six months salary. This upfront cost totals nearly $2.87 million.
However, because the salaries and benefits were included throughout the entire 2011 budget, NPPD stands to see savings beginning in year one.
“We wanted to do it early enough in the year that we could use dollars already budgeted,” Steiner said.
Salaries and benefits are expected to comprise 20-25 percent of the $1 billion budget for 2011, including those paid to Cooper Nuclear Station employees.
Steiner said NPPD has been looking to reduce its work force through attrition for more than a year, with this recent move simply expediting the process.
Last year, 51 district employees retired — a similar number to what would have been expected during 2011 without the incentive program. Steiner described each of the approved applicants as likely candidates for retirement within 18 months anyway.
A complete list of outgoing employees will be presented to the board of directors at its April 15 meeting.
According to Steiner, NPPD already has authorized some of the positions to be filled, mainly internally, leaving a trickle-down of openings to consider leaving unfilled. A small number of employees accepting early retirement also will be hired back part-time, he said.
Steiner views the changes as an opportunity for advancement and diversification among the utility’s remaining employees.
NPPD last offered a voluntary retirement program in the late 1990s when the district was going through business restructuring and cost-reduction efforts.
In November, the district announced rate increases averaging 11.4 percent for retail customers and 9.7 percent for wholesale customers, citing rising fuel costs, infrastructure investments and decreased revenues from power sold in the off-system market as reasoning. Those increases took effect Jan. 1.