WEDNESDAY EDIT: 'Voluntary separation' program a cost of doing business

The city of Coeur d'Alene's effort to save money by offering early retirement incentives to eligible employees makes sense but comes at a cost. Citizens will eventually decide if it's worth it.

Those who qualify for the Voluntary Separation Incentive Program, estimated to be around 30, are for the most part the ones who have been with the city the longest and make the most money. They have great jobs with great benefits and generally the person holding such a job isn't anxious to give it up. 

By shedding their salaries, the city hopes it could be part of the equation when it no longer needs to use money from the general fund, raise property taxes and take foregone taxes to meet expenses. It will bring in folks who will make far less money doing the same thing. The city has been running a deficit and wants to correct it.

It makes sense, especially in difficult times, to reduce spending. And the city spends a lot on its workforce of roughly 420 employees. Wages and benefits total around $48 million. But we would argue it is money well spent. We have long said Coeur d'Alene is a well-run city. It is clean and friendly, with good streets, beautiful parks, inexpensive water, with relatively low taxes and low cost of living. That's a credit to those in charge at City Hall.

It used to be cities and businesses wanted to hang on to their longtime employees with vast knowledge of the places they live, and an understanding of what people want. But keeping such seniority around isn't cheap. 

The city has seen the announced retirements of Police Chief Lee White and Fire Chief Tom Greif, which is a blow as they have both done outstanding jobs in arguably the most important departments in Coeur d'Alene. It does not want to see too many department heads leave at the same time. 

Yet, financial challenges are forcing its hand.

Here's how the Voluntary Separation Incentive Program would work:

There must be total savings of at least $25,000 in the first full year of separation.

Employees have until Dec. 5 to provide a letter of interest to be considered for the program and for those approved, they will most likely go to the City Council for approval Dec. 16. Employees must voluntarily separate from the city by Dec. 31, 2026.

Through the program, an eligible employee would receive a 1% service payout based on the employee’s base annual wage in the preceding 12 months from their separation date multiplied by their total years of completed city service.  

For example, if an employee makes $100,000 multiplied by 1% at 20 years of service it would come out to $20,000 paid as taxable wages on a final check.  

The plan also calls for compensation for sick leave, vacation and comp time. 

It sounds like those who qualify for the program would walk away with a hefty last check and enjoy their retirement. Not a bad way to go. As well, they could seek work elsewhere if they wanted. To that, we say, "Good for you." 

There would certainly be a loss of institutional knowledge with the program, and that is unfortunate. But the city's firm foundation and continued strong leadership from the council, mayor and leaders at City Hall will pave the best, and most affordable, path forward.