RT-D EXCLUSIVE: VDOT bonuses, salary increases assailed, defended

The Virginia Department of Transportation last year paid more than $200,000 in one-time bonuses and more than $300,000 in salary increases to retain some of its top employees.

The 2008 payouts, disclosed in documents provided by VDOT at the request of the Senate Finance Committee, come amid ongoing plans in the agency to reduce overall staffing levels by 1,000 employees and to cut 450 hourly and temporary workers during the next 18 months.

Bonuses and retention payments are not unique to VDOT. For years they have played a role in how Virginia state government compensates its work force.

Last year, Virginia taxpayers funded $3.65 million for 7,458 one-time bonus payments to state employees, said Gordon Hickey, press secretary for Gov. Timothy M. Kaine. There were an additional 634 nonmonetary awards in gifts such as mugs, T-shirts, plaques and other items, valued at $28,729.

The payments ranged from modest cash rewards for employees taking on additional duties, to raises for workers acquiring additional job skills, to signing bonuses for new hires and retention bonuses to keep workers from leaving for better-paying jobs in the private sector.

"The commonwealth certainly recognizes the tough economic times we're in and continues to tighten our belts just like citizens," Hickey said. "There's real value in offering skilled employees rewards and affirmation to retain them and to reward them for improving their skills."

Critics say the decision to fork over extra cash is unwise given the agency's aggressive downsizing and the need to curtail expenditures amid the recession.

"Certainly there are some very talented employees at VDOT and all state agencies," said Sen. Ryan T. McDougle, R-Hanover. "But as a policy decision, it seems to me irresponsible to be paying out retention bonuses and out-of-cycle pay raises when we have seen a sustained climate of economic decline, and certainly unemployment levels in Virginia where they have not been in recent history.

"When we're stopping core services and laying off employees and still paying out one-time salary increases," McDougle continued, "then you have to really ask whether we are making good decisions with our resources."

At VDOT, officials said the bonuses were a good investment that safeguards public safety on the state's bridges and roads.

"I think it's essential to attract and retain the right people to safely manage our highway system," Virginia Secretary of Transportation Pierce R. Homer said. "And we delude ourselves if we think we can do this on the cheap."

In addition to the bonuses, VDOT spent $306,432 in salary increases in 2008 to retain 74 employees, part of $2.37 million in "salary adjustments" made for 684 workers.

Homer said that with the exception of salary increases for worker retention, the additional money was taken up by required pay adjustments to workers who were promoted, reassigned, given expanded duties or transferred when VDOT shuttered 28 percent of its facilities across the state.

He also noted it would be "pennywise and pound foolish" not to increase pay of some specialized, in-demand employees. He said it costs less and is safer than losing experienced workers and training replacements.

"A structural bridge engineer, a traffic operations center -- people's lives depend on these things," Homer said. "And if people want to make hay with that, they're making hay with public safety.

"You can't train somebody overnight for that. It costs thousands of dollars. We simply can't afford to lose these highly qualified people."

In recent years VDOT has been a target of conservative Republican lawmakers, who say the agency is lumbering and inefficient. One of the more vocal critics, Sen. Mark D. Obenshain, R-Harrisonburg, recently launched a Web site called "Expose VDOT Waste."

VDOT's payroll this year is $651 million, up from $425 million in 2000. Officials said 70 percent of the difference is the result of approved increases in pay and benefits since 2000.

Reta Busher, the agency's chief financial officer, said the department also has increased the number of positions it fills with professional engineers and licensed engineers. She said recruiting engineers has been a challenge.

But VDOT has not been immune to belt-tightening. As of March 1, VDOT had 8,300 employees; it will have an estimated 7,500 employees by July 2010.

Homer said the staff reductions are driven by the worsening economy and complicated by the fact that the legislature has been unable to agree on a statewide transportation package to fund maintenance and new construction projects.

As a result, the agency has been forced to cut its construction budget by about $3 billion, eliminating all urban and secondary road projects, Homer said. To accommodate reduced funding, VDOT is considering closing about half its highway rest areas and reducing ferry service by one-third.

Contact Jim Nolan at (804) 649-6061 or jnolan@timesdispatch.com.

VDOT bonuses