BUYOUTS ENDORSED AT DWP; EARLY RETIREMENT, SEVERANCE OFFERED.

Byline: Rick Orlov Daily News Staff Writer

Department of Water and Power employees - faced with layoffs in the push to competition - could retire early with full benefits or walk away with up to $50,000 in severance under a $40 million buyout package tentatively approved Tuesday by DWP commissioners.

S. David Freeman, the agency's general manager, said the package could attract about 800 volunteers out of the 2,000 jobs that he wants to eliminate. He said the money would come out of the employees' $4.7 billion pension fund.

``This is a way for people to leave with dignity and retire to make way for other workers,'' Freeman said. ``We never said we were just going to throw people out without any resources. This is a way to soften their leaving.''

The buyout package won support from the Board of Water and Power Commissioners and is expected to go to the City Council for final approval next week.

The board also tentatively approved a proposal to extend to 2002 the department's contract with its electrical workers organized under the International Brotherhood of Electrical Workers. The workers would receive a 1.9 percent pay raise next April and annual increases of 4 percent in the remaining years.

The cost of the deal is estimated at $2.5 million a year.

Freeman plans to trim the work force by 2,000 people by February as part of a plan to accelerate the paying off of the department's massive $7 billion in debt over the next five years.

``Every week we delay reducing the work force costs me $2.5 million,'' said Freeman, who added that the package will encourage older workers to step aside, rather than using their seniority to bump younger workers out of their jobs.

Freeman is trying to make the agency more competitive as the utility industry prepares for deregulation to take effect Jan. 1.

Joel Fox of the Howard Jarvis Taxpayers Association said he believed the buyout made some sense, particularly if it didn't affect the utility's ability to pay off its debt.

``There's no question this restructuring has to be done if the DWP is going to survive,'' Fox said. ``If they can do it using retirement system money, so much the better.''

As for the raises, Fox said he would have to study them more closely.

Southern California Edison Co., the DWP's main local competitor, went through similar cutbacks last year and also offered incentives to have workers retire, said spokesman Steve Hanson.

Hanson said Edison offered a variety of programs similar to those being suggested by the DWP but at a cost of $17 million for the 3,000 workers who took part.

Hanson said Edison's cost was lower because it made the program available to all employees over the age of 47 with a minimum of five years on the job. As a result, the utility didn't have to pay as much when people with fewer years of experience left.

Mayor Richard Riordan said through an aide that he hasn't had a chance to completely review the package but that it appears to be a good start for reducing the department's work force.

Council President John Ferraro was attending a National League of Cities meeting in Philadelphia and could not be reached for comment. Councilwoman Jackie Goldberg, who chairs the council's Personnel Committee, said she could not comment on the matter because it deals with personnel issues.

The buyout package, which had been recommended by council members, will allow DWP workers at the age of 50 with 30 years of experience to begin drawing their full retirement instead of waiting until age 55.

It also allows people with 25 years of experience and under the age of 50 to add time to their years of service to be eligible for retirement.

In addition, it will allow other workers to collect two weeks' pay for each year they have worked for the DWP up to a maximum of $50,000. However, those who opt for early retirement won't qualify for the severance deal, officials said.

Initially, the buyout is being offered to members of the International Brotherhood of Electrical Workers, which expects to have 200 to 300 workers affected by the DWP restructuring.

Freeman was given authorization by the Board of Water and Power Commissioners to try to extend the offer to the Engineers and Architects Association, which is expected to take the brunt of any layoffs.

The total cost of the program, with both unions participating, is expected to be $40 million.

``I don't know if they will accept something like this,'' Freeman said. ``I have meetings set with them, but the situation is we have this generous package and they have to take advantage of it by Feb. 1. After that, there will be layoffs.''

Officials with the union did not return telephone calls.

The last IBEW contract tied raises to the Consumer Price Index, which has been below the amount given other city workers.

Freeman said the raises also were designed to recognize the extra work that will be performed by a reduced staff.

Brian D'Arcy, general manager of IBEW Local 18, said a new contract would guarantee labor peace at a critical time for the agency.

``The issue is whether or not they want to have a strike in a period where they're trying to restructure,'' D'Arcy said. ``All we are seeking is parity with other city workers. I suggest to everybody we don't need labor strife.''