The Tennessee Conservative [By Adelia Kirchner] –
Approximately 600 Tennessee Valley Authority (TVA) employees have agreed to a voluntary buyout offer presented by the federal utility agency last year in efforts to reduce costs.
Back in May, TVA publicly announced a new executive team whose role is to cut operational costs by almost $1 billion by September of next year.
The voluntary buyouts are part of this operational cost-cutting effort, which works in tandem with TVA’s plan for its largest ever capital investment of $16 billion to build new power plants and upgrade transmission lines.
According to TVA spokesperson, Scott Fiedler, voluntary employee departures started in May of this year and will continue through September.
“As part of our Enterprise Transformation, we have followed a rigorous process to refine TVA’s operating model and design an organizational structure that prioritizes operational excellence and improves efficiency,” Fiedler stated. “To create capacity in the workforce to make sustainable organizational design decisions, a voluntary reduction-in-force offering was made for employees ready for retirement or a new career outside of TVA. More than 600 employees took advantage of the offering and are exiting TVA between May and September.”
According to an in-depth report from Daniel Dassow with the Chattanooga Times Free Press, Fiedler said in a text that TVA will not be reporting the city-specific numbers of employees who agreed to take the buyout.
In August 2024, Former TVA Chief Financial Officer John Thomas presented the official budget plans to the TVA board.
“We have cumulative $950 million in savings built into the plan, and we still have a lot of work to do to realize those savings,” stated Thomas. “By the time you get to the end of 2026, that will mean $500 million of efficiency gains every year that will need to stay in forever.”
As part of this budget, TVA internally announced its voluntary buyout program to reduce its workforce of approximately 11,000, offering qualifying employees 5 days of pay for every full year of service with a 150-day maximum if they opted to retire or resign.
Since offering the buyouts, TVA has accumulated $40 million in severance costs. As of June 30th, the agency had paid out $26 million.
According to Chief Financial Officer for TVA, Tom Rice, around 90-95% of the planned workforce reduction will be voluntary.
“There are some targeted areas of the business where there are some potential involuntary reductions in force,” said Rice. “We work very hard to place individuals back in the business.”
TVA says the number of involuntary reductions will be small, but has not provided the total number of positions that will end up being eliminated.
“We have folks that are not in a position right now but still interested in staying at TVA,” Don Moul, the new chief executive officer for TVA, stated during a press conference. “They’re looking for opportunities across TVA right in this window, so I can’t give you a final number for involuntary reductions, but it’s going to be a small number.”
While TVA was initially established as a federal agency by the U.S. Congress in 1933, the utility company has been self-funded since 1959 and does not rely on taxpayer monies.
Due to the agency’s financial self-reliance, the Trump administration buyouts recently offered to federal employees are not available to TVA employees.
About the Author: Adelia Kirchner is a Tennessee resident and reporter for the Tennessee Conservative. Currently the host of Subtle Rampage Podcast, she has also worked for the South Dakota State Legislature and interned for Senator Bill Hagerty’s Office in Nashville, Tennessee. You can reach Adelia at adelia@tennesseeconservativenews.com.
One Response
So those with 30 years of service haven’t retired yet??? Why? I know TVA has a pension system that rivals the Feds. So if you have 30 years of service you’re getting a bonus to retire. Sounds like a great deal to those seeking a golden parachute…
I don’t know what that’s going to mean for our utility bills, but even if they streamlined, I imagine they will find a way to increase them any way.