GMP CEO Mary Powell, right, and CVPS CEO Larry Reilly. VTD/Anne Galloway
The merger of Green Mountain Power and Central Vermont Public Service will result in the elimination of about 116 positions through attrition and retirements over the next five years, according to a document submitted to the Public Service Board from the utilities.
The workforce of the merged company will be reduced by an additional 23 positions when the smart meter program is implemented.
Gaz Metro, a Montreal-based corporation, which owns Green Mountain Power, has offered to buy CVPS, the state’s largest electric utility. The combined company will serve eight out of 10 Vermonters. The merger deal is now under review by the Public Service Board and is expected to be approved in May.
Gaz Metro estimates the labor savings to be worth about $110 million over a 10-year period. That figure is part of an overall estimate of $226 million in savings, about 59 percent of which would go to ratepayers. About $82 million in savings in the first five years would be used by Gaz Metro to cover the costs of the acquisition of CVPS, according to utility officials and PSB documents.
The average employee for CVPS makes $71,428, not including executive pay; the average Green Mountain Power worker earns $77,383, excluding executive wages, according to documents filed with the Public Service Board.
CVPS now employs 532 workers; GMP has 206 employees. In all 715 Vermonters work for both companies. That total would be reduced to 599 after five years.
The two utilities have overlapping service areas, and the merger will create an opportunity to eliminate redundant operations and maintenance services.
The workforce reductions will not be made through layoffs, according to Dorothy Schnure, communications director for Green Mountain Power, but through attrition and expected retirements. About 40 percent of the workforce would be eligible to retire within the next five years, though the company expects a number of employees to continue working past retirement age, she said. The utility will not offer incentives to retiring workers, Schnure said.
“This is not a typical pattern where a company comes in and makes immediate changes to the workforce,” Schnure said. “The changes will take place more slowly. It’s more the Vermont way to do it, without the layoffs.”
The headquarters for CVPS is in Rutland and city officials have worried that all the cuts would be made in central Vermont.
Schnure says Green Mountain Power, based in Colchester, made a pledge to Rutland “to make sure the decrease is proportional.” According to the chart, 47 jobs would come from CVPS and 27 from Green Mountain Power. An additional 44 jobs would be eliminated and the locations for those job cuts has not been broken down in the chart. None of the positions, including executive roles, have yet been identified, Schnure said.
Sen. Kevin Mullin, R-Rutland, said CVPS executives will receive golden parachutes worth millions. The total compensation for company higher ups is projected to be $18 million, plus additional perquisites.
“I think it’s shameful we’re taking comfort in reducing rates to ratepayers by eliminating jobs,” Mullin said. “It’s unfortunate, but I can’t help but think a significant portion of those jobs will be in my region. Rutland will get part hard hit by deal, but there’s no stopping it.
I would hope the PSB would calculate all these factors into the decision-making process.”
As part of the deal, Gaz Metro has offered to create a new downtown headquarters in Rutland and to make the city a center of solar innovation.
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While I support this meager overall, and as aCVPS customer have been very satisfied with the service, I now have strong concerns.
Why have the executives of CVPS swept their promise to pay back the $21M under the carpet? They knew they had the obligation when they(we) solved their financial problems. They and more specifically the board of directors, new about when they put themselves up of sale. Why no pay back? Why no disclose. I believe the Board and senior executives colluded avoid this payment. That is at least morally wrong and maybe criminal.
Now we are paying them $18m in golden parachute payments?
I would like to see exactly to who and how much those payments are.
I am also very concerned that we, the rate payers, are not seeing our fair share of the efficiency improvements from the new combined corporation.
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What about CVPS employees and former CVPS employees (like myself) who are vested in CVPS Employee Pension Plan?
Does GMP / Gaz Metro plan to honor the CVPS Employee Pension Plan? Or, will they play a similar kind of “shell game” like they are doing in regards to paying back (or not) the $21M that ratepayers spent to “bail-out” CVPS?
The PSB should honor the agreement made over a decade ago with CVPS. Pay back “We the Ratepayers”!
We can spend our “own money” to stimulate the Vermont economy. We can weatherize our own homes, if we choose (or not). We can spend our small portion of the $21 bailout at local farmer’s markets, local businesses on Main St., etc. It is the ratepayers money, not the State of Vermont’s money, or GMP or Gaz Metro or CVPS’ money. It was bailout money.