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Public-sector manager pay adds up: We reveal comp of region's top execs

By   /   Monday, August 30th, 2010  /   Comments Off on Public-sector manager pay adds up: We reveal comp of region's top execs

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Lompoc City Administrator Laurel Barcelona and Moorpark City Manager Steve Kueny run cities of about the same size, but their paychecks are in different weight classes. Barcelona took home $166,557 in pay and benefits last year, while Kueny’s compensation was 73 percent higher, at $288,583.

Lompoc and Moorpark are both bedroom communities with roughly 40,000 people. The cities are different, of course — the people of Moorpark are significantly wealthier, for example. But the city governments have similar responsibilities, except that Lompoc has its own police department and Moorpark does not.

A Business Times study of the pay and benefits of every city manager and county executive in the region reveals many disparities in compensation, sometimes unrelated to the size of the city or county. The survey also found that non-salary compensation can add $100,000 or more to a top executive’s total pay.

No one in the Tri-Counties earns anywhere near the salaries or benefits that have fueled outrage in Bell, where the L.A. Times found that the city manager was making $787,000 in salary and more than $1.5 million in total compensation. The city of Vernon also paid its top official more than $1 million last year.

The highest-paid top executive among the 25 cities and three counties in the tri-county region was Oxnard City Manager Ed Sotelo, whose salary in 2009 was $266,014 and whose total compensation was $355,401.

After Sotelo, the highest-paid city and county executives were Ventura County CEO Marty Robinson, Thousand Oaks City Manager Scott Mitnick and Simi Valley City Manager Mike Sedell. All made more than $300,000 in total compensation last year.

The lowest pay to someone who was in office for the full year went to Guadalupe City Manager Regan Candelario, who made $80,023 in salary and $110,432 in total compensation.

Candelario was an outlier, though. Every other city manager made at least $130,000 in salary and $140,000 in total compensation. The median compensation was $214,304 and the median base salary was $159,954.

CHART: Total compensation 2009 for top public-sector executives in the Tri-Counties. [Scroll over bars more information.]

Benefits can be opaque

The compensation totals include salary and bonuses, other cash pay such as car or housing allowances or money paid in exchange for unused time off, and non-cash benefits such as health care and contributions to retirement accounts and other savings vehicles. The totals do not include the payments cities have to make to cover their pension obligations, but they do include any payments made by a city or county to cover what ordinarily would be the employee’s share of pension contributions.

Non-salary benefits are often overlooked in discussions of public-sector pay, and they can vary tremendously. Robinson, Ventura County’s chief executive, had $109,779 in non-salary compensation in 2009, while Solvang City Manager Brad Vidro’s total compensation was only $3,380 more than his base salary.

“The perks are deceptively easy to slip into employment packages,” Herb Gooch, a political science professor at California Lutheran University, said in an e-mail interview with the Business Times. City councils, he said, “are often willing to sweeten employment packages with perks the voters don’t understand or are hidden, as most people only think in terms of — and have easy access to — base salary figures.”

One common benefit is a contribution to the city manager’s retirement plan, similar to a 401(k) plan in the private sector. In 2009 Oxnard put $34,582 into Sotelo’s retirement plan — on top of the $52,732 the city paid to fund his pension.

“That’s becoming more of a normal benefit,” said Dave Mora, a retired city manager and the West Coast director of the International City/County Management Association. “It’s not an exception anymore, and it’s not just for the manager.”

Salary and benefits are both public records under California law, but that only means that cities and counties must disclose them when asked. It doesn’t mean they have to volunteer the information.

The Bell scandal triggered a series of pay and benefits inquiries by newspapers and government watchdog groups, and the results have been trickling out, city by city. In most cases, the base salaries are readily available, but total compensation can be tougher to pinpoint. Most of the cities in the Tri-Counties took anywhere from a few days to two weeks to reply to the Business Times’ requests for complete salary and benefits information.

In response to the Bell revelations, California State Controller John Chiang has asked every city and county to supply its full pay and benefit information. Chiang said he will start posting the data on his office’s website in November.

“This is a major issue, and folks want information, and they’re rightfully asking for it,” Mora said. “In terms of breaking down all the benefits, it might not be readily available, and I think that’s going to change. … By this time next year, or long before this time next year, you are going to see each city and each county have that information on its website.”

The county of Ventura was the only local government in the region that made its complete executive compensation data available on its website. It posted the information after the Ventura County Star submitted a public records request for it.

“This is taxpayer dollars and so it should be transparent,” said Ventura County Supervisor Kathy Long. “It should be available for anyone to look at.”

Like the other four elected board members, Long makes $119,005 in base salary. In 2009 her total compensation was $142,638. The supervisors’ salaries are fixed at a portion of the salary for a Ventura County Superior Court judge.

Long said she was “shocked” when she heard about the salaries in Bell and Vernon. “They should be embarrassed,” she said. “No one in public service should ever have an evergreen contract with automatic raises like that. Obviously, the public wasn’t watching, but neither were they making it clear to people what was going on.”

Private sector pays more

The figures revealed in the Business Times survey back up the notion that executive pay is higher in the private sector than in government. The CEOs of the region’s biggest publicly traded companies make millions of dollars a year, and many of those companies are smaller than the biggest city governments.

For example, Oxnard has 1,200 employees and a budget of about $360 million. The CEO of a company that size would almost certainly make more than Sotelo’s $355,401, said David Lewin, a professor at the UCLA Anderson School of Management.

“The conventional thinking about public sector executive pay is that it is quite low relative to industry and also quite narrow, rather than dispersed, in terms of ranges,” Lewin said in an e-mail interview.

But the conventional thinking might be obsolete. The range of pay among public sector executives is “much greater than commonly thought,” Lewin said.

Long said she thinks Ventura County gets a bargain with Robinson. She runs by far the biggest public agency in the region, with about 8,000 employees and a $1.6 billion a year budget.

“It is a broad organization, with multiple subjects and multiple divisions, and the buck truly stops with her when it comes to operational efficiencies,” Long said. “I’ve told Marty, ‘I think you’re underpaid.’ ”

The size of an agency and its budget aren’t the only things to consider when evaluating an executive’s pay, Gooch said. Job titles and responsibilities, cost of living and seniority all play a part.

Some cities call their top executive a “city manager,” while others use the title “city administrator.” City managers generally have more power than administrators and are paid better.

Barcelona is Lompoc’s city administrator, but she really has all the power of a city manager, Lompoc Finance Director Brad Wilkie said. “We just happen to call it ‘city administrator,’ ” he said.

The cost of living is a factor, too — last year the median home price in Lompoc was $203,000, less than half that of Moorpark, according to the research firm DataQuick.

Wilkie said Lompoc pays less than the average city of its size for most jobs, but he doesn’t think it has any problems attracting quality employees.

“We haven’t had that many openings, but the people who’ve come here have done a great job,” he said.

Closing the loopholes

Six bills have been introduced into the Legislature to try to prevent another Bell or Vernon fiasco. One would require greater transparency in pay information, and others would put caps on pension payments earned through high salaries, limit the pay of elected city council members and prohibit automatic pay increases.

Whatever happens in Sacramento, Gooch said the real watchdog against excessive pay has to be city council members and the voters who elect them.

“As the case of Bell demonstrates, a clever scoundrel can reward himself and his cronies without limit, so long as he is smart enough to keep things legal and has deaf and dumb oversight — dumb council and deaf public,” Gooch said.

• Business Times intern Lexi Pandell also contributed to this article.

Editor’s Note: An earlier version of the chart accompanying this article misstated the compensation of retired San Luis Obispo City Manager Ken Hampian. It was corrected on Aug. 31.

[Click here for a multimedia slideshow of top public-sector manager pay.]

TABLE: Total compensation in 2009 for top public-sector executives in the Tri-Counties. Editor’s note: The total for retired SLO City Manager Ken Hampian includes a $52,144 payout for unused vacation and other one-time benefits paid upon his retirement.

 

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