The Coeur d'Alene City Council on Dec. 16 approved a voluntary separation incentive program and individual agreements for a group of city employees after a presentation from City Treasurer/Finance Director Katie.

Key details presented by staff: the program requires separations no later than Dec. 31, 2026; eligibility is calculated as 1% of base wages times years of service; participants must direct 100% of eligible sick-leave payout to the city's HRA/VEBA plan and agree to opt out of the city's medical coverage (no COBRA/retirement continuation). Staff said each eligible position must demonstrate at least $25,000 in first-year savings, calculated through promotion, recruitment at a lower wage, or department reorganization; minimum vacancy months were listed for positions that did not immediately meet the savings threshold.

Staff projected gross vacancy savings and one-time versus ongoing savings. Summary projections provided to council estimated roughly $928,933 in preliminary vacancy savings scenarios, incentive payments just under $610,000 (with payroll and retirement taxes raising the total incentive cost to about $736,000), and net multi-year savings that staff said would be realized by fiscal year 2027 and beyond. For FY26, staff projected $281,000 in savings against $458,000 in incentive costs (a net cost that staff proposed to manage through the budget amendment process).

Council voted to approve incentive agreements for a list of named employees (as presented to council), including Troy Timison, George Daley, Bill DeRider, Jeff Fletcher, Mike Frederick, Tom Greif, Katie Hurst, Blaine Porter, Matt Soa, Juanita Knight, Lisonbee Palmer, Bill Greenwood, Mark Walter, John Cantrell, Judy Griffin, Louise Martin, Brandon McCormick, Tim Neil, Bill Tilson, Lee White, Dennis Grant, Terry Lee, David Hauser, and Larry Parsons, among others. Councilors voiced appreciation for the employees; several council members said the program is a tool to realize budget savings and aid planning for future staffing and recruitment.

Why it matters: The program carries a substantial one-time payroll cost and relies on vacancy management and longer-term attrition to produce projected net savings; council indicated staff will monitor outcomes and may bring budget amendments to reflect FY26 impacts.

Next steps: Staff said incentive payments and separations are binding upon approval and would be scheduled per the agreements; council discussion indicated staff will continue audit work and track realized savings across fiscal years.