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PacifiCorp to cut 20% of work force By DAVID PRESZLER PacifiCorp will slash 1,600 jobs -- a fifth of the power company's work force -- in the coming five years. The dramatic cutbacks were announced Wednesday as part of a restructuring plan by ScottishPower, which took over the utility company in December. Alan Richardson, PacifiCorp's new chief executive, said the "transition plan" will restore the company's once-strong position. "It's about getting PacifiCorp back toward the front among U.S. utility companies, where it belongs," he said. Before completing its purchase of PacifiCorp in December, Scottish Power said it planned to cut costs by $10 million annually. The plan unveiled Wednesday goes beyond that. By 2004, the company expects operating expenses to be $300 million lower and capital expenses $250 million lower than 1998 levels. It also plans a $150 million investment in employee training and technology. Richardson said the cuts will be spread throughout the company, which employs 8,000 people in six states. It has 2,400 employees in Oregon. He said he did not know how many jobs in Southern Oregon would be cut. PacifiCorp employs about 108 employees in Medford and 54 in Grants Pass. "The bottom line is that we want to save a lot of money," he said. Employees learned of the plan's basics Wednesday. Company officials hope to eliminate most of the jobs through early retirement and a voluntary severance package. He said 900 employees are eligible for the early retirement, offered at age 53 with 15 years of service. "Sixteen hundred jobs in anyone's book is a lot," Richardson said. "We'll do that with sensitivity. Remember we are talking about five years here." The cuts are on top of 900 jobs already trimmed in the past 18 months companywide. The depth of the cuts worries Jason Eisdorfer of Citizens Utility Board, a consumer group. "I'm a little concerned about the overall health of the utility when it cuts that many people," he said. "Are they cutting into bone when they do this? This may well go to the kind of service they can provide." Richardson insisted that the plan "puts the customer first" and that customer service will improve, not suffer. Improving service while cutting costs may seem contradictory, but he said technology and training can raise service standards with lower costs. Richardson said workers have remained focused on their jobs. "People are obviously anxious," he said, "but they also want us to get this right for this company. They want us to succeed, even though they realize they may not be part of it." Eisdorfer, however, said the mood at the company is glum. "Their morale is pretty low in that company," he said. "I have a lot of trouble believing that 1,600 people over the next five years are going to voluntarily retire." The company is negotiating with state regulators to raise residential rates 12.8 percent to generate an additional $61.8 million from Oregon operations. Richardson said shareholders' returns "are poor and way below what they should be." Making cuts now keep costs as low as possible and keep rates "lower than they otherwise would be," he said. Today's Edition : News | Sports | Business | Weather | Tempo | Classifieds Mail Tribune Copyright � The Mail Tribune 2000, Medford, Oregon USA