Premium ContentMouse over Home then click on Premium Content for information.More than a year after the City of Bellevue announced a plan to get control of its unlimited vacation bank policy, Police Chief John Stacey has accumulated even more hours, and his nest egg is now worth $183,280.
Stacey, the poster child for the city's generous vacation benefit, has now stockpiled 3,702 hours of vacation time — and that's after selling back 200 hours earlier this year, collecting $9,002.
Under a long-standing policy, which The World-Herald examined in September 2010, City of Bellevue employees have been allowed to bank all their unused vacation and cash it out at their current salary. Most employees have waited until retiring to cash out.
The benefit had become a significant fiscal burden when former City Administrator Gary Troutman started tackling the problem last year.
He had recognized the growing problem for years. Shortly after being promoted to city administrator in 2003, he sent a memo to city department heads capping vacation carry-over at 200 hours.
"If you are one of the employees with excess hours, please make every effort to utilize the excess this year," Troutman wrote in the July 23, 2003, memo obtained by The World-Herald. "Thank you in advance for your cooperation in getting this matter resolved."
But the city didn't follow through. It wasn't until last year that Troutman instructed employees to cash in part of their time and began implementing a policy to cap carry-over time.
Bellevue paid out about $230,000 in vacation buyouts in fiscal year 2010, equal to 7,000 work hours. In fiscal 2011 the city spent $517,000 to reduce the vacation banks.
Current City Administrator Dan Berlowitz is cracking down even more.
City employees currently have a total of 38,807 hours of unused time, worth $1.2 million if they all cashed in their time today.
Berlowitz has put Stacey and the other department heads on notice that the days of employees adding to vacation stockpiles are nearing an end.
"Some directors and employees have ... not utilized their vacation leave as it was intended and accrued a large number of unused vacation days," Berlowitz stated in a November memo. "This situation has created a large unfunded liability for the city."
He told employees to reduce their unused time to 120 hours per person by next October. Berlowitz said he has met with department heads such as Stacey to discuss ways to address their individual vacation banks.
Come October, the city will buy out any balances in excess of 120 hours unless prohibited by current union contracts.
Berlowitz said vacation and sick-leave benefits are not meant to be "supplemental retirement plans."
"John's situation is the most problematic, but I don't want to single him out," Berlowitz said of Stacey. "But the bottom line is that he will be at 120 hours come Oct. 1."
Since Berlowitz started in May, he has made progress chipping away at the problem. Total vacation stockpiles are down 15 percent compared with a year ago.
In 2010, 42 employees had more than 300 hours of carry-over vacation. Today, 24 employees still have 300 or more hours.
"My goal is to have everyone at the same level of 120 hours," Berlowitz said. "I'm very serious about this. It's not winning me any popularity contests."
Bellevue cannot, however, impose across-the-board mandatory caps because the benefit is part of several collective-bargaining agreements. The city is tackling the problem as it renews each union's contract.
For example, the 30 employees in the Bellevue Professional Management Association agreed to reduce unused vacation caps to 120 hours in their current contract. Members of the Bellevue Employees Association, which covers clerical staff, mechanics and equipment operators, among other workers, have until May 2013 to cap their vacation balances at 120 hours.
And the Bellevue Police Command Staff Association has until May 1, 2013, to reduce its cap to 360 hours.
Challenges remain in reducing the largest vacation banks: A year ago, 16 employees had stockpiled at least 500 hours in unused time. Today, 13 employees still have that much time.
The city would need about $600,000 in the 2012 and 2013 budget years combined to whittle down all employees' vacation banks to the 120-hour cap, Finance Director Rich Severson said.
Joe Bockman, a street maintenance foreman, said he's fine with capping accrued vacation as long as it's done for everyone. Bockman had to cut his saved time to 120 hours in May, down from a peak of 400 hours.
"We just want to get this thing nipped in the bud. Otherwise it's going to be a tremendous financial hardship for the city," said Bockman, who plans to retire in January after more than 40 years with the city. "It's just one of those things that has always been there. It snowballs and it keeps rolling down the hill."
Vacation time tends to stack up more quickly for managers because, in addition to receiving paid time off, they get an additional two weeks of "use or lose" vacation. That perk was provided in lieu of such employees being eligible for overtime pay.
Stacey, for example, receives about six weeks of paid vacation each year, plus the two additional weeks.
City Councilwoman Carol Blood said the council has left it up to Berlowitz to bring the vacation accrual matter to a close.
"I don't think anybody envies City Administrator Dan Berlowitz's job right now. He has my full support because it needs to be done. It needed to be done a long time ago," Blood said.
"We are saving the taxpayers literally hundreds of thousands of dollars in the long run by addressing this now instead of waiting," Blood said.
When council members hired Berlowitz last spring, they structured his contract to avoid allowing him to bank large amounts of time, as his predecessors could. Berlowitz can carry over only 10 unused vacation days each year. Any remaining time must be cashed out annually.
Lupe Mier, longtime library director, has met with Berlowitz to work out a plan to reduce his vacation bank of 640 hours — down from 900 a year ago.
Mier said he plans to sell back more than eight weeks of unused vacation and schedule the other eight weeks off.
"There is no way I can take it all off," Mier said. "I'm probably going to have to sell 340 hours. I have no choice."
A 22-year employee, Mier is entitled to more than five weeks of paid vacation annually, plus his "use or lose" time.
"It's time we get everything level, whether it's the administration or the lowest-paid person on the staff," Mier said. "We've just got to work real hard to get through this year."
Stacey, who did not respond to requests for comment, will be expected to use some of his 92.5 weeks of accrued vacation over the next 10 months.
But taking off too much time would be counterproductive, given his job responsibilities, Berlowitz said.
The longer that Bellevue employees hang onto their time, the pricier it is for the city, because the time increases in value every time workers get a raise.
In September 2010, Stacey's 3,668 hours were worth $165,060. He now has 34 more hours, but because he received a raise, the total value has gone up by $18,220.
In 2012 he will get another six weeks of vacation plus two weeks of use-it-or-lose-it time. Last year he took those two weeks off but used only 14 hours of his paid vacation.
Given the tax consequences for Stacey of receiving his total $183,280 payout in one lump sum, Berlowitz said, the city might spread out the chief's vacation payments over two years.
"He's been open to working with us," Berlowitz said. "But that's a tough one.
"He's already got a year and a half of vacation. There is no way John can use up 3,700 hours by Oct. 1."
Contact the writer:
402-444-1056, john.ferak@owh.com
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