Fritz Schwarz, Jill Bright, Paul Quintero Cc: Jeffrey Friedlander From: R

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Fritz Schwarz, Jill Bright, Paul Quintero Cc: Jeffrey Friedlander From: R MEMORANDUM For: Fritz Schwarz, Jill Bright, Paul Quintero Cc: Jeffrey Friedlander From: R. Kyle Alagood Date: October 8, 2015 Re: An Overview of Public Official Compensation Studies in Other U.S. Jurisdictions A NON-RANDOM SAMPLE OF OTHER JURISDICTIONS’ SIMILAR COMPENSATION REVIEWS Citizen commissions to study the compensation of elected officials exist at virtually all levels of state government in a variety of jurisdictions throughout the country. Some are fairly good; others only undertake a superficial analysis. Some ideas are good; others have less merit. The following reports are not necessarily representative of pay commissions, but they highlight issues with respect to evaluating compensation of elected officials. Each report is briefly overviewed here and attached with the most recent first. [A] Compensation of City of San Diego Elected Officials (February 2015) o Officials Covered . Mayor . City Council o Key Ideas . The opening paragraph calls the process by which a commission recommends salary changes to city council and city council chooses to accept, reduce, or reject the commission recommendations “fundamentally flawed” because it “means Councilmembers are required to vote for their own compensation and that of the Mayor.”1 . This process “creates a conflict of interest by requiring Councilmembers to vote for their own base wages.”2 But basing compensation solely on external benchmarks as put forward by a commission of outsiders risks removing democratic accountability. If elected officials go too long without any compensation review, there is a significant risk that an increased cost of living will “discourage qualified individuals from running for office.”3 o Selection of Data Used . Salary of Superior Court Judges 1 SAN DIEGO COUNTY GRAND JURY, COMPENSATION OF CITY OF SAN DIEGO ELECTED OFFICIALS 1 (2015), available at http://www.sandiego.gov/grandjuryreports/pdf/electedofficialscompensation.pdf. 2 Id. 3 Id. 1 . Consumer Price Index . Salaries of elected officials in comparably sized cities . Salaries of other elected officials in San Diego County . Salaries of officials in selected private sector corporations . Salaries of other city employees (staff, appointees, deputies) o Additional Points . San Diego has a “strong mayor, strong council” form of government. The City of San Diego’s population is 1,381,069. [B] Report of the Utah Elected Official and Judicial Compensation Commission (December 2014) o Officials Covered . Governor . Lieutenant Governor . Attorney General . State Treasurer . State Auditor o Key Ideas . “Compensation” for public office includes the prestige and honor associated with holding elected office. While useful for analysis, “[m]arket factors and other comparative analysis have limited application.”4 . “Political factors are inevitably an overriding consideration in making [compensation] adjustments,” but citizen commissions have the “responsibility . to remove, to the maximum extent possible, political considerations from [their] recommendations.”5 . There are public policy considerations when recommending salary levels for elected office. These include compression and the risk that attracting the best appointees and employees will require paying them more than the elected official for whom they work. Salaries set too low create a perception that officeholders may have to augment their salaries from political funds or other sources, and this sends a bad message. o Selection of Data Used . Compensation of high-level Utah appointed officials . Market data for private sector executive positions The commission found this of limited value. Compensation for relevant local government officials 4 REPORT OF THE UTAH ELECTED OFFICIAL AND JUDICIAL COMPENSATION COMMISSION 15 (2014), available at http://le.utah.gov/interim/2014/pdf/00005455.pdf. 5 Id. 2 E.g., To analyze the Attorney General’s salary, the commission looked at city and county lead attorney salaries. University president salaries . School district superintendent salaries . Elected executive (governor, lieutenant governor, attorney general, treasurer, auditor) salaries in other states The commission found this of limited value because of wide variations in officials’ duties among states. o Additional Points . Utah law specifically sets only the governor’s salary. The other executive elected officials are statutorily paid 95 percent of the governor’s salary. [C] Massachusetts Special Advisory Commission on Public Compensation: Report to the Public, Legislature, and Governor of the Commonwealth of Massachusetts (December 2014) o The Massachusetts Special Advisory Commission followed many of the same concepts as planned by the Quadrennial Advisory Commission for involving the public. The Massachusetts report is worth a full read-through to understand how transparency, public input, and a “guiding philosophy”6 of public interest strengthen the analysis of elected officials’ compensation. Like the Quadrennial Advisory Commission, the Massachusetts Special Advisory Commission utilized a website to post records, reports, and public information. Its archived website is found at https://www.umb.edu/academics/mgs/special_projects/masspubliccomp. o Key Ideas . Recommendations on elected officials’ compensation should be “based on the principle that an effective democracy requires exceptional representatives of the people . [and] a constitutional officer’s salary should enable any capable individual . regardless of his or her economic means and geographic representation, to offer his or her talents to the public interest.”7 o Selection of Data Used . Rank of Massachusetts elected officials among other states, both adjusted for cost of living and not . Private sector executive salaries . Base pay for other full-time state legislatures, both adjusted and unadjusted . Changes in income of state residents, as reported by the Regional Income Division of the U.S. Department of Commerce, Bureau of Economic Analysis 6 SPECIAL ADVISORY COMM’N ON PUB. COMPENSATION, REPORT TO THE PUBLIC, LEGISLATURE, AND GOVERNOR OF THE COMMONWEALTH OF MASSACHUSETTS 4 (2015), available at https://www.umb.edu/editor_uploads/images/mgs/Final_Report_Special_Advisory_Commission-NOV30.pdf. 7 Id. 3 o Additional Points . The Massachusetts commission considered the following factors in studying the salaries of elected officials: Ability to attract and retain a diverse and high quality set of people in determining public policy and the delivery of public services. Official list and scope of responsibilities undertaken by public officials. Comparability of salaries of similar positions in other states, as well as comparability within the state’s own salary structure. Comparability of direct and indirect compensation of public officials with similar employment in the private sector, including for-profit and not-for-profit businesses. Skills and qualifications required, and level of responsibility associated with the position. Effects on the current, future, direct, and indirect costs of salary decisions on the state’s finances. [D] Massachusetts Special Advisory Commission on Public Compensation: Preliminary Findings of Fact (November 2014)8 o This is the Massachusetts Commission’s “preliminary findings of fact,” issued after the commission gathered evidence and assembled research. Massachusetts’ preliminary facts memorandum to the public follows the Quadrennial Advisory Commission’s guiding principles, among which are “to learn by listening,” “be transparent,” make “all our research materials . digitally available,” and invite comments from any who choose to submit them.”9 o Key Ideas . Public involvement is paramount. Constitutional officers’ salaries should appropriately reflect the importance of each position’s respective responsibilities and responsibilities vis-à-vis each other. Gubernatorial residence (which Massachusetts does not have) may be considered a form of compensation. Although its exact dollar value benefit cannot be assigned, it can be estimated. [E] Report of the Committee to Study the Compensation of the [Montgomery] County [Maryland] Executive, County Council, Sheriff, and State’s Attorney (September 2013) o Officials Covered . County Executive 8 SPECIAL ADVISORY COMM’N ON PUB. COMPENSATION, PRELIMINARY FINDINGS OF FACT (2014), available at https://www.umb.edu/editor_uploads/images/mgs/Special_Advisory_Commission_on_Public_Compensation_Prelimi nary_Findings_of_Fact.pdf. 9 Memorandum, 2015 Quadrennial Advisory Commission: Getting Organized 1-2 (Oct. 8, 2015). 4 . County Council . Sheriff . State’s Attorney o Key Ideas . Median income of residents is a factor to consider when evaluating elected officials’ pay. Population and population growth are factors to consider. Evaluation should include a study of the demands of each position, responsibilities involved, level of independent decision-making, complexity of decisions, and the impact decisions have on the public. Interviews with current and former elected officials are key to fully understanding their roles in government. “The skills and expertise [needed to be on County Council] are similar to those required for high level management positions in the private sector. Although this Committee recognizes that private sector salaries are not an apt comparison, such salaries should inform this process to a certain degree.”10 o Selection of Data Used . Comparable positions in jurisdictions with similar populations Montgomery County’s population was 1,004,709, so the committee looked at jurisdictions with
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