MANCHESTER, NH – A detailed report on the topic of severance payments to city employees was requested, following an ordinance amendment from the Board of Aldermen on Tuesday night.
Requests for increased transparency were spearheaded by Ward 5 Alderman Anthony Sapienza, a vocal critic of the city’s current severance practices.
Sapienza told other board members that his concerns were not with rank-and-file employees’ severance benefits, but with six-figure amounts being given to employees who had large municipal salaries prior to leaving their positions.
The case for transparency was not opposed by any members of the board. Instead, divisions arose over how to approach the issue.
Alderman At-Large Joseph Kelly Levasseur, Ward 6 Alderman Elizabeth Moreau, and Ward 8 Alderman John Cataldo shared Sapienza’s concerns, with Levasseur requesting that unnamed examples be provided within the upcoming reports that give insight into how the system works in certain situations.
Mayor Joyce Craig indicated that singling out unnamed specific employees would not likely be insightful due to the wide variety of situations that can arise in severance situations, but a list of criteria that impact severance payments could be provided within the report.
In particular, Levasseur’s concern surrounded money attached to unused vacation time.
Moreau told the board that if something was not done, that residents would eventually move to other towns or cities.
Other members of the board noted that the severance payments are part of contractual agreements with the city employee unions, and simply ignoring them outright would leave the city legally vulnerable to financial damages.
Ward 12 Alderman Keith Hirschmann and Ward 7 Alderman William Shea noted the city’s legal obligations, citing that the issue could be discussed again at future collective bargaining negotiations, but also noting that the amounts had to be paid through some mechanism in the meantime.
Alderman At-Large Daniel O’Neil also noted these obligations, chiding other Aldermen concerned with the issue, stating that they were not providing solutions to the problem.
Ward 4 Alderman Christopher Hebert had a different view on the topic, focusing on city services demanded by his constituents, supporting more transparency to discover the proper funding amounts to maintain those services.
Ward 1 Alderman Kevin Cavanaugh also stated that not keeping benefits offerings competitive could cost the city key civil servants, who would then be lured to jobs in other municipalities.
Mayor Craig joined with Hirschmann in reminding the Aldermen that line items within the city budget for severance payments had been unfunded for several years and continuing the practice could leave the city legally vulnerable and also jeopardize the city’s bond rating.
The ordinance amendment that spurred the discussion was approved by an 11-3 vote, with all Alderman voting in favor except for Levasseur, Cataldo and Sapienza.
That amendment, discussed through the Aldermen’s Committee on Bills on Second Reading, changed a current ordinance that placed half of any general fund operating surplus into a revenue stabilization reserve account, also as a “rainy day fund,” with the other half being returned to tax payers.
With the change, future general fund operating surpluses will instead be split into thirds, with a third now going to a severance reserve account, a third going to the rainy day fund and a third going back to taxpayers.
