City maintenance workers have until Dec. 31 to accept job offer

By Monica Mendoza Published: December 4, 2013 | 9:15 pm 0

More than 50 Colorado Springs fleet maintenance employees have until the end of December to accept an offer of employment with Serco, the international company taking over fleet services for the city.

Since the city announced in June that it would outsource its fleet management program and let go 70 employees, some found other jobs. Fifty-four stayed and all were offered jobs with Serco, said Laura Neumann, chief of staff.

"The majority of city fleet employees applied with the new firm and all who were made offers by Serco were offered pay at or above their present pay, with one senior manager's offer at 35 percent over his present pay," Neumann said.

The city finalized a $35 million, five-year contract with Serco in October, and city employees now are readying for a move to the private company's payroll, said Tim Neun, Serco corporate communications. Serco's contract begins Jan. 1.

"All qualified personnel currently working for the City of Colorado Springs were given first right of refusal for their position," he said. "As of today, over 80 percent of them have accepted and we are transitioning them to the Serco team to continue their support for the city."

Virginia-based Serco is the American division of Serco Group, which is based in London. The company has about 500 employees in Colorado Springs, with contracts at the military installations, local school districts and commercial companies.

About 55 percent of the Serco fleet services contract will be paid by the city and 45 percent will be paid by Colorado Springs Utilities, which previously paid the city to maintain its fleet of vehicles and equipment.

If the city is not happy with the company's work it can end the contract, Neumann said. For example, Serco must begin maintenance work within 15 minutes of a set appointment and begin work on a vehicle or equipment within four hours of a nonappointment drop off. And if Serco takes more than 24 hours to start a job, the city can send the vehicles to another company at Serco's expense.

By using a private company to maintain the city's 4,500 vehicles and pieces of equipment, the city estimates it could save about $4 million over five years. That figure does not include what the city would have paid in retirement benefits for the 70 employees, Neumann said.

"Some don't think that initial savings is a lot," she said. "It is when we reduce the number of city staff on the pension plan - that is a step toward long-term fiscal sustainability."

In 2013, the city paid about $26 million in benefits through the Public Employee Retirement Association. The city has no control over PERA, Neumann said, and the only way to decrease the city's PERA responsibility is to decrease the number of employees, who can receive about 60 percent of their highest three years of salary.

"Our fleet people did a great job," Neumann said. "This makes good business sense. It was difficult decision to make."

The money saved will be redirected to other city programs, she said. In the 2014 budget, the city reinstated Sunday bus service and added police officers, she said.

Of the 4,500 city vehicles and pieces of equipment, about 1,600 are Utilities vehicles.

"We were initially concerned about how our specialized equipment would be maintained," said Bruce McCormick, Utilities chief energy services officer. Utilities owns large hydraulic equipment and trucks with insulated buckets that have strict electrical safety requirements, he said.

"Serco has a lot of broad experience maintaining public fleets, including utilities vehicles," McCormick said.

Serco will work from the city's two maintenance facilities, body shop and five police department service locations. It also has plans to add a crew to the utilities north work center, off Powers Boulevard.

"It helps allow us to have the vehicles maintained on site rather than bring down to Fontanero," McCormick said. "It's an operational benefit for us in terms of us not having lost vehicle time."

Last year, the city outsourced some of its snowplowing crews, laid off six employees and eliminated 13 positions from streets, planning and finance departments. In 2014, the Information Technology department will outsource nine positions.

A citizens' task force that provides feedback on the city's finances will continue to look for ways to save money, Neumann said. For now, there are no other services or departments targeted for outsourcing in 2014.

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