The Metropolitan District Commission laid off 16 employees after losing a trash-processing contract, and the regional water-sewer agency might lay off more as well.
As part of an ongoing feud over MDC losing its $17 million contract to run the waste-processing component of the Mid-Connecticut Project for the Connecticut Resources Recovery Authority, the MDC announced late Friday it would impose organization-wide layoffs.
That statement turned out to be misleading.
The organization already laid off 16 positions already and doesn't know if more will be necessary in the future, said Chris Stone, MDC assistant general counsel.
"I don't know if, when or how many," Stone said.
The16 employees that were laid off didn't work at the plant but instead offered support services from the MDC headquarters, such as human relations and accounting. Because the Mid-Connecticut Project provided MDC with a 14.7-percent markup on direct costs, those support service departments had to cut people appropriately.
"It is not something that anyone at the district wanted to do, but it was something that was fiscally responsible to do because of the loss of that revenue," Stone said.
CRRA spokesman Paul Nonnenmacher said MDC should never have been funding non-operational positions with the Mid-Connecticut Project money anyway. The contract was supposed to cover only the operational costs and not fund MDC's other operations.
"They aren't supposed to be making a profit off of us," Nonnemacher said.
After it lost the Mid-Connecticut Project to Washington state-based NAES Corp., the MDC announced that 82 of its employees at the trash-to-energy power plant would be laid off. However, none of those employees will lose their jobs, as they will be hired by NAES into the same positions with the same salary, although with lower benefits.
The 16 employees are on MDC's callback list if the organization increases its revenue. The organization now has 579 employees.
The loss of the Mid-Connecticut Project contract has prompted other action as well. MDC sued CRRA over its competitive bidding process, a lawsuit that was dismissed in August.
in her ruling State Superior Court Judge Julia Aurigemma said MDC was overcharging CRRA by as much as 30 percent of the direct costs, resulting in more than $7 million in overpayments to MDC. Aurigemma also said MDC didn't take the competitive bid process seriously, leading to losing the contract to NAES.
"MDC ought to take a look in the mirror," Nonnemacher said.
The union officials with the American Federation of State, County and Municipal Employees have protested the contract as well.