Government Executive Pay and Severance Agreements Are Out of Control

golden-parachuteThe bill for Santa Ana’s decision to release it’s former City Manager, Paul Walters, from service has been released, and it’s a big one—$706,396.85. The Voice of OC reports that “the city since 2010 has had to fork over at least $1.3 million to show top executives the door.”

Walters’ payout includes the following, according to city figures:

  • $264,999 – Base salary for retaining his position as police commissioner, essentially regional law enforcement liaison, for one year.
  • $101,425.68 – Medical and retirement benefits for one year.
  • $164,553.90 – Two years of U.S. Air Force retirement credits purchased by the city under the state’s public employees retirement system, known as CalPERS.
  • $167,918.27 – Accrued holiday, vacation and sick pay, to be paid in four installments.
  • $7,500 – half of Walters’ attorney’s fees racked up while negotiating his severance from the city.

By any measure, that’s a boat-load of cash.

Former Santa Ana City Manager Chief Paul Walters (Photo: Chris Prevatt)

Former Santa Ana City Manager Chief Paul Walters (Photo: Chris Prevatt)

Mayor Pro Tem Sal Tinajero, spokesman for the Council majority which forced Walters out has claimed that the move was necessary and that it was the result of Mayor Miguel Pulido reneging on promises to the council majority. Promises which were made to garner the needed votes to have Walters hired on as the permanent City Manager about six months ago.

Tinajero told Voice of OC that only about $250,000 of Walters’ payout amount was actually negotiated in addition to the severance Walters was guaranteed in his employment contract. The clause the council was trying to escape that cost them so much money was the one giving Walters back his old job as police chief if he resigned or was terminated. That was, rightfully, unacceptable after the disparaging statements made by Walters wife and brother-in-law in the weeks leading up to his removal.

But regardless of the merits, or rationale, for removing a city manager six-months into their contract, there is an underlying problem. These lucrative contract agreements themselves are unreasonable. The idea that senior executives would be allowed to rack up unlimited amounts of sick and vacation time and cash it out at the end of their contract, while also getting a full year of salary and benefits, should outrage ANY reasonable person. The fact that a reluctant majority, unanimous in this case, would agree to a contract that allows the city manager to bump a police chief out of his or her job if the city manager is fired, or resigns is unconscionable.

Yet five of the current seven members of the Santa Ana City Council negotiated, and agreed to, these unreasonable provisions.

This pattern is repeated in city after city, county after county, government entity after government entity. Senior executives are granted extraordinary pay, benefits, and severance agreements that paint an inaccurate picture of public employees as being over-paid, getting sweetheart deals on the taxpayer dime. But that picture only reflects the reality for the chosen few, the most senior of executives. These high-rollers get car allowances sufficient to fund two luxury car leases, and other perks which the remainder of our public workforce are not entitled to.

We await the outrage from the Orange County Register’s editorial staff highlighting over-paid public executives. But we won’t hold our collective breath while we wait for it. While they are busy crowing about alleged over payment of rank-and-file public employees, they are more likely to admit to the existence of global climate change, than recognize who the real leeches are.

  5 comments for “Government Executive Pay and Severance Agreements Are Out of Control

  1. cook
    February 23, 2013 at 11:24 am

    The state passed a new law a few years ago closing some of the costly loop holes.

    But like most state laws, many of the government employees are considered grandfathered in.

    So the taxpayer saving will not show up for 20 years or so.

  2. Carl Overmyer
    February 24, 2013 at 1:00 pm

    It’s all a part of the greater spending problems, in my humble opinion. I still think most of them say, at least to themselves, “hey it’s not like it’s MY money!”

    Glad to see you taking this one on, like you, I’m waiting for the Register to speak up on it as well.

  3. Junior
    February 24, 2013 at 8:22 pm

    Public exec. pay, while imo excessive, is a drop in the bucket compared to public employee total benefits.

  4. Marcus Wilson
    March 4, 2013 at 7:15 pm

    Is it too much money? Yes. Was he really worth it? No. But the cost of keeping him was a hidden cost that’s actually far more expensive. I commend the Santa Ana City Council for making the tough (and expensive) decision to let Paul Walters go. I’m of the opinion they’re wising up and make good decisions for Santa Ana’s future.

    • Santa Ana Resident
      March 6, 2013 at 11:03 am

      I agree with part of the above. It was too much money and probably not worth it for the residents.
      I disagree in that the only reason it was a good decision by the city council is that it limited the city’s legal exposure.
      It was this city council’s own immaturity in causing a potentially ridiculously expensive legal liability in the first place. If they had not been so unnecessarily aggressive in attacking the mayor and city manager, and put the people’s interests first ahead of their own political ambitions, they would have been able to settle for the initial contract commitment without an additional added payout.
      This is no omen for any kind of good decision making by this council.

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