Tahoe-Truckee’s highest-paid public employees will make $3.7 million, as base pay, in 2014 (special report) | SierraSun.com

Tahoe-Truckee’s highest-paid public employees will make $3.7 million, as base pay, in 2014 (special report)

Matthew Renda and Ardy Raghian
Special to the Sierra Sun

EDITOR'S NOTE: An earlier version of this story had the wrong timespan in terms of when these salaries were analyzed. We probed the numbers over a 30-year timespan — not 40 years, as originally reported. The Sun regrets the error.

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TAHOE/TRUCKEE, Calif. — The average base salary of the top leaders of public agencies throughout the Tahoe/Truckee region in 2014 is three and a half times that of the average American worker, according to data analysis performed by the Sierra Sun.

Executives of these public entities — whether the Tahoe Truckee Unified School District, the smattering of public utility districts, various fire protection districts that have separate jurisdictions throughout the region, or the bistate Tahoe Regional Planning Agency — make an average of $165,000 per year, a figure that does not include varying insurance benefits, bonus opportunities and other forms of compensation.

“We haven’t been able to give employees a raise in years, so we keep losing them to other agencies. We’ve been tight-fisted because we have to be.”
Larry Sevison
TRPA Governing Board member

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This figure does not include Tahoe Forest Hospital CEO Robert Schapper, as his $404,000 annual base salary would have skewed the numbers and ensuing comparisons.

The average American worker in 2014 makes about $45,000 annually, according to data compiled by the Social Security Administration — about $3,000 less than the average salary for a CEO of a public body in Tahoe/Truckee 30 years ago, in 1984.

Further, the average American worker makes about $7,000 less than the living wage, defined as the amount of money an individual must make to support his/her family if that person is the sole provider.

The issue of salaries of public leaders elicits a spectrum of opinions, often firmly rooted in political persuasion — some believe it is indicative of loose spending practices in the public sectors, while others believe the salaries given to leaders who oversee multi-million budgets are proportionate with their responsibilities.

Likewise, some believe occupying high-ranking positions in the public sector should be more about service and community pride and less about lucre, while others counter that in order to attract and retain the types of capable individuals necessary to efficiently run critical agencies, being competitive in the employee market is a must.

"It's all relative," said Truckee Mayor Patrick Flora, an elected official on the Truckee Town Council. "(Truckee Town Manager) Tony Lashbrook makes about 3.7 times the average employee (about $185,000 for the town manager compared to the average wage of a town of Truckee employee, $48,000). In the private sector in 2013, the average CEO makes about 331 times the average employee.

"If you are asking me if Tony is overpaid, I would say no," Flora continued. "But if you are asking me if he is underpaid, I would also say no. Considering he managed 100 employees and oversees a $25 million budget, I would say his salary is about right."

Flora and most sources quoted in this story sit on boards composed of officials elected by the agency's constituents. In all cases, they are tasked with establishing the salary range for the public agency's leader, and in most cases, the elected officials either receive zero compensation, or a comparatively modest amount.

LOOKING AT THE RANGE

Of the salaries analyzed at 21 public agencies in the Truckee/Tahoe region, the going rate for the services of a Chief Executive Officer ranged from $131,000 to about $215,000 (again, this excludes the Tahoe Forest Hospital CEO).

The leaders include airport district managers, general managers for public utility districts, fire chiefs, police chiefs, town/city managers, TTUSD superintendent and the executive director of TRPA.

According to the data, public utility district general managers earn the most, and Truckee Donner Public Utility District GM Michael Holley leads the way with $215,000 in base pay in 2014 — which, again, does not include a benefits package that escalates his compensation past a quarter of a million dollars annually.

Aside from Schapper, Holley earned the highest compensation package of any public leader, for managing a roughly $34 million annual budget and overseeing 77 employees, according to the California Controller's Office.

Coming in second, South Lake Tahoe Public Utility District GM Richard Solbrig garners a base salary of $205,000 for overseeing a budget of $15.4 million and a roster of 128 employees.

Toward the lower end of the spectrum, Truckee Tahoe Airport District General Manager Kevin Smith pulls in approximately $143,000 per year for managing a roughly $4 million budget and 35 employees. The lowest annual base salary is that of North Tahoe Fire Protection District Chief Michael Schwartz, at $131,000.

Despite TRPA's stature as the most significant regulatory agency in the Lake Tahoe Basin, with much of its framework superseding that of the counties, cities and special districts, its executive director, Joanne Marchetta, receives one of the lowest base salaries at $149,000.

Treading the middle ground, city managers, special district leaders and police chiefs receive compensation packages that are closer to the average of $165,000 per year.

Breaking things down beyond annual salary, public agency leaders in Truckee/Tahoe make on average $80 per hour — which is roughly nine times that of minimum wages in California and Nevada. Some make as much as $108 per hour, or about 11 times minimum wage.

INFLATION OVER TIME

During the process of seeking and analyzing data, the discrepancy between minimum wage workers and the leaders of public institutions were not always so pronounced.

For example, in 1984, leaders of public agencies in Truckee/Tahoe received an average salary of about $48,000 per year, with leaders at the upper edge of the spectrum earning about six times the minimum wage.

In a 10-year period, that average rose 31 percent to roughly $63,000 annually in 1994. The largest percentage increase came between 1994 and 2004, when the United States economy grew at a rapid rate.

Salaries for Truckee/Tahoe public leaders escalated 82 percent, climbing to about $115,000 per year. By comparison, the average wage in the United States climbed 45 percent from $24,000 to $35,000, a more tepid growth pattern, but by far the largest jump over the 30-year period analyzed in the study.

Over the 30-year period, wage inflation for public leaders in Truckee/Tahoe amounted to 243 percent increase, from averages of $48,000 to $165,000. Over the same period, average wages in the nation grew by 181 percent, from $16,000 to around $45,000 in 2013, the last available data set recorded on the Social Security Administration website.

Between 2004 and the present year, a period of time that encompasses what is now known as The Great Recession, wages for the average American grew by 28 percent, while compensation for public leaders grew by 43 percent.

And to put things at mass perspective, when you add up all 21 base salaries analyzed for this story for 2014, the highest-paid public leaders at Tahoe-Truckee make more than $3.7 million annually (this figure includes the Tahoe Forest CEO salary of roughly $404,000).

SPREADING THE WEALTH

Economists universally agree the pace of America's recovery has been sluggish since Lehman Brothers went bankrupt in 2008 and the U.S. Government bailed out AIG and infused over $700 billion into the private sector in the ensuing months.

Economists, who perhaps by profession are allergic to consensus, also agree that recovery has disproportionately benefited America's most wealthy — commonly known as the "1 percent."

However, elected and appointed representatives do not necessarily agree that salary inflation for public CEOs conforms to the same market forces steering the private sector.

"That's just not true in our case," said TRPA Governing Board Member Larry Sevison, whose position is appointed. "We haven't been able to give employees a raise in years, so we keep losing them to other agencies. We've been tight-fisted because we have to be. We are a bistate agency and we cannot get out of touch in terms of our salaries."

Truckee Mayor Flora said the town of Truckee — unlike some other agencies — has "trimmed from the administration down."

"We cut weight from the administrative level on down," he said. "We have managers taking on more work for the same amount of money, and to my mind, that is a bit of an anomaly."

Nancy Ives, president of the Northstar Community Services District board of directors, said her board was careful to give all employees raises once district finances grew more favorable out of the recession.

"We raised everybody," she said. "They went three years without any type of an increase except for cost of living, and when we could, we gave everybody a raise, from the plow guys up to the CEO."

The Northstar Community Services District doubled its fire chief's salary from $80,000 to $160,000 from 2004 to 2014, one of the largest increases of any agencies analyzed for this story.

Ives said the jump can be explained by a combination of forces, including hiring a new chief, having that chief accrue seniority pay, and the fact the district has grown exponentially with the addition of the Northstar Mountain Residences and The Ritz-Carlton, Lake Tahoe in the intervening years.

BIG RESPONSIBILITIES

Most elected representatives interviewed for this story asserted the compensation packages presently on the books struck the appropriate balance between being responsible stewards with public money with expanding the necessary dollars to attract talented administrators to critical positions.

"We want somebody great, but we always know we are spending other people's money," said Kim Szczurek, president of the Tahoe Truckee Unified School District board.

TTUSD hired a new superintendent, Robert Leri, in 2012. Leri's base salary package is worth $174,000 for 2014, but Szczurek said it's not only competitive with that of other similarly sized school districts, but raises are tied to performance, as opposed to length of term.

"There are no more automatic range changes," Szczurek said. "In fact, our entire executive staff has been changed to performance-based contracts. It's no more you live and breathe and get a raise."

On average, leaders of public organizations at Tahoe-Truckee earn about 3.5 times more than the average employee at the agencies, but Szczurek said the superintendent position is in many ways an unenviable one.

"Our teachers work fewer days in a year than executives," she said. "Dr. Leri has to make decisions that affect a $40 million-a-year organization that is highly complex and highly regulated with a large constituency base."

Additionally, the job security at many of the leadership positions in the public sector is fluid, as politics can shift dramatically, where as many of the rank and file members of the public sector have legislatively enhanced job security by comparison, Szczurek said.

OVER AT TAHOE FOREST

Bob Schapper, CEO of Tahoe Forest Hospital, has been the subject of much commentary in the Tahoe-Truckee community the past few months, since it was reported that the hospital directed roughly $915,000 toward Medical Practice Solutions — a company helmed by Marsha Schapper, Schapper's wife — over the course of more than seven years.

While that has been investigated and deemed by the hospital board as a non-issue after a board-hired attorney concluded insufficient evidence exists Schapper violated California's conflict of interest laws, some of the focus has also centered on the fact his approximately $404,000 annual salary is far and away the largest for any public leader in the Truckee/Tahoe region.

The annual base package represents an 80 percent increase from his 2004 salary, which was $223,000, one of the large increases of any of the salaries analyzed.

"Admittedly, it's a lot of money," said Tahoe Forest board member Roger Kahn, who added that Schapper oversees a budget of a $100 million and a complex organization that includes doctors, nurses and paid hospital staff. "There is an incredible amount of federal and state regulations. You have to be able to balance a lot of tasks and keep everybody happy. Running a hospital is more complex than other public agencies."

Kahn said the board uses an objective methodology to determine the hospital CEO's salary, and his best guess is that after things settle down and if Schapper moves on from the hospital, the next CEO will be making a similar amount.

LARGER COMPARISONS

The complexity of running a public agency; the large dollar amount of annual budgets that must be managed and ideally balanced; and the healthy roster of employees who must be kept happy and productive are the reasons universally cited to justify the salaries at public institutions throughout the region.

As a point of comparison, the salaries of eight of the 21 public CEOs at Truckee-Tahoe exceeded the annual salary of California Gov. Jerry Brown.

Brown made about $173,000 in 2013. He oversees a budget of about $120 billion and a roster of 130,000 employees. Nevada Gov. Brian Sandoval, meanwhile, makes about $145,000, less than nearly all of the 21 public leaders analyzed. Sandoval manages an $8.9 billion operation, and the state of Nevada employs about 3,700 people.

You can also compare the states to a large county government such as Washoe County, where County Manager John Slaughter gets paid $200,000, nearly $50,000 more than Sandoval for overseeing an annual budget of approximately $330,000 million with a roster of 2,500 employees.

Marsha Berkbigler, Washoe County Commissioner for District 1 (which represents Incline Village), said the discrepancy in salaries is attributable to the fact governors often have a full slate of officials, both elected and not, to help with the administration of the complex mechanisms of the state government.

Further, while there are only 50 state governors, there are thousands of county managers in America, and when counties such as Washoe conduct analysis of similarly populated jurisdictions, the sheer number of other positions means there is natural upward pressure on the salaries.

"When we look at negotiating contracts with our unions, we are looking at communities of the same size, and our employees will often come back and ask for a raise that puts them in the same range," Berkbigler said.

Perhaps, the lack of peers accounts for why President Barack Obama takes home $400,000 in base salary — roughly the same as Tahoe Forest's Schapper.

— Matthew Renda is a former reporter for the Sierra Sun and North Lake Tahoe Bonanza and currently is a Santa Cruz-based writer. He may be reached for comment at matthew.renda@gmail.com. Ardy Raghian is a fourth-year undergraduate student and editor at City on a Hill Press, the student-run weekly at University of California, Santa Cruz.

EDITOR’S NOTE: As part of a comprehensive analysis, the Sierra Sun reached out to 21 agencies in the Truckee/Tahoe region to gather salary information for each agency’s CEO/Executive Director/General Manager.

The base salary is presented at four different data points, each a decade apart, beginning in 1984, to demonstrate the change in pay over a 30-year timespan. The following information, for the sake of comparison, does not include other elements typically included in compensation packages for leaders at public agencies, such as benefits, transportation allowances, pensions and bonuses. The comparisons presented are for base salaries only.

In many instances, the public agencies queried could not or would not provide salary information dating back to 1984. Some public agencies, such as the town of Truckee, which didn’t incorporate until 1993, did not even exist in 1984. Other agencies claimed their records or W2 statements dictated they could only provide salary information from certain years.

North Tahoe Fire Protection District officials said they do not keep records past seven years.

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Tahoe Truckee Unified School District Superintendent

1984: $52,666

1994: $78,272

2004: $140,000

2014: $174,525

84-94: $25,606 increase

94-04: $61,728 increase

04-14: $34,525 increase

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Tahoe Regional Planning Agency Executive Director

1984: $63,768

1994: $71,801

2004: $115,000

2014: $149,000

84-94: $8,033

94-04: $43,199

04-14: $34,000

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Truckee Town Council Town Manager

1994: $77,500

2004: $133,146

2014: $185,203

94-04: $55,646

04-14: $52,057

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Tahoe Forest Hospital District CEO

2004: $232,000 (base pay changed October from 190K)

2014: $404,227

04-14: $172,227

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Truckee Fire Protection District Chief

1994: $66,600

2004: $101,844

2014: $140,616

94-04: $35,244

04-14: $38,772

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Truckee Donner Public Utility District General Manager

1984: $60,000

1994: $76,836

2004: $127,296

2014: $215,781

84-94: $16,836

94-04: $50,460

04-14: $88,485

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Truckee-Donner Recreation & Park District General Manager

1984: not employed

1994: $59,630

2004: $105,739

2014: $148,133

94-04: $46,109

04-14: $42,394

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Tahoe City Public Utility District General Manager

1984: $55,248

1994: $69,996

2004: $122,364

2014: $193,488

84-94: $14,748

94-04: $52,368

04-14: $71,124

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Truckee Tahoe Airport District General Manager

1994: $48,400

2004: $108,911

2014: $142,360

94-04: $60,511

04-14: $33,449

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North Tahoe Public Utility District General Manager

1984: $47,880

1994: $67,776

2004: $130,000

2014: $162,356

84-94: $19,896

94-04: $62,224

04-14: $32,356

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North Tahoe Fire Protection District Chief

2014: $131,000

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Truckee Tahoe Sanitation Agency General Manager

1984: $49,500

1994: $82,284

2004: $150,756

2014: $185,160

84-94: $32,784

94-04: $68,472

04-14: $34,404

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Northstar Fire Protection District Chief

1984: couldn’t locate

1994: $55,030

2004: $79,999

2014: $165,582

94-04: $24,968

04-14: $85,583

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Squaw Valley Public Services District General Manager

1984: $39,111

1994: $61,214

2004: &127,503

2014: $189,138

84-94: $22,103

94-04: $66,288

04-14: $61,634

—–

Squaw Valley Fire Protection District Chief

1984: $14,880

1994: $51,458

2004: $97,704

2014: $146,760 (projected)

84-94: $36,577

94-04: $46,245

04-14: $49,056

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Incline Village General Improvement District General Manager

1984: $54,000

1994: $82,820

2004: $125,000

2014: $175,000

84-94: $28,820

94-04: $42,180

04-14: $50,000

—–

Meeks Bay Fire Protection District Chief

1994: $54,861

2004: $95,095

2014: $137,415 (person retired April 2014)

94-04: $40,234

04-14: $42,320

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South Lake Tahoe City Manager

1984: couldn’t find

1994: couldn’t find

2004: $113,297

2014: $169,998

04-14: $56,700

—–

South Tahoe Public Utility District General Manager

1994: $86,400

2004: $130,502

2014: $203,976

94-04: $44,102

04-14: $73,474

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South Lake Tahoe Police Chief

2004: $91,977

2014: $149,635

04-14: $57,658

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Truckee Police Chief (formed in 2001)

2004: $122,060

2014: $163,113

04-14: $41,053

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Below are salary totals for regional positions and other state/federal figures, to offer readers a basis for comparison:

Nevada County Manager

1984: $55,570

1994: $87,069

2004: $120,000

2014: $176,500

84-94: $31,499

94-04: $32,931

04-14: $56,500

—–

Placer County Manager

1984: $54,845

1994: $94,144

2004: $176,965

2014: $222,679

84-94: $39,298

94-04: $82,820

04-14: $45,714

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Washoe County Manager

1984: $61,867

1994: $112,436

2004: $171,827

2014: $200,803

84-94: $50,569

94-04: $59,390

04-14: $28,976

—–

Douglas County Manager

2004: $122,567

2014: $172,000

04-14: $49,433

—–

El Dorado County Manager

2004: $131,487

2014: $160,076

04-14: $28,588

—–

Reno City Manager

1984: $58,000

1994: $76,807

2004: $188,276

2014: $191,925

84-94: $18,807

94-04: $111,569

04-14: $3,649

—–

Sparks City Manager

2004: $152,567

2014- $190,008

04-14: $37,441

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Gardnerville City Manager

2004: $62,506

2014: $86,377

04-14: $23,871

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Nevada Governor — $149,000

California Governor — $174,000

US President — $400,000

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Minimum Wage (CA)

84: $3.35

94: $4.25

04: $6.75

14: $9

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Minimum Wage (NV)

84: $2.75

94: $4.25

04: $5.15

14: $8.25