One reason your electric bill is high: bountiful pay for MID workers

The Modesto Irrigation District – accused in a lawsuit of overcharging electricity customers – pays its workers more on average than all cities and counties and most other water agencies in the region.

The average MID employee pulled down $91,105 in 2016. That’s 21 percent more generous than the $71,818 average wage for workers at 17 city halls in The Modesto Bee’s area.

County governments in this area – Stanislaus, Merced, Tuolumne and San Joaquin – paid an average wage of $65,298 in 2016, according a Bee analysis of data provided by Transparent California, a project of the Nevada Policy Research Institute whose public compensation database is the largest in California.

Stanislaus private-sector jobs paid $43,106 last year, on average, according to the U.S. Bureau of Labor Statistics. Throughout the four-county area, the average private wage was only $39,969.

MID uses power profits – $93 million a year, on average, since 2010 – to subsidize farmers’ water prices, to reduce debt and to build its savings account. Residential power customers also subsidize E.&J. Gallo Winery, the world’s largest wine producer, whose contract allows Gallo to consume 11 percent of the electricity sold by MID while paying 6 percent of its power revenue.

“We’ve established competitive industry salaries to attract the most qualified candidates in a variety of specialized fields,” MID spokeswoman Melissa Williams said.

The district has not raised electricity prices in five years, Williams noted. Staff proposed an increase in late 2014, but board members – sensitive to the mood of customers – declined.

(Click here to see The Bee’s collection of $100K Club salary databases)

The well-documented subsidy prompted a class-action lawsuit that, if certified by a judge, could draw in MID’s more than 100,000 power customers.

The only government agencies in this area paying their people more than MID are Stanislaus Consolidated Fire District and the Turlock Irrigation District, whose average full-time wages in 2016, respectively, were $103,208 and $96,481.

Health and retirement benefits offered at MID, however – costing the district $54,500 per employee – are pricier than those at Stanislaus Consolidated ($42,008) and TID ($50,575), and all other local government agencies.

City and county labor costs: a bargain, compared to MID

Average wages at the two most visible agencies in The Bee’s area – Modesto City Hall and Stanislaus County – came in at $79,006 and $60,381, respectively; with benefits, average Modesto and county employees cost taxpayers $108,833 and $88,003, respectively, compared to MID’s $145,604.

Of MID’s 488 employees, 186 made more than $100,000 in 2016, not counting benefits. That was 38 percent of MID’s work force.

TID, which has roughly twice the acreage of MID, paid $100,000 or more to 185 of its 521 workers, or 36 percent.

By comparison, 13 percent of City Hall workers in Modesto made it into the $100,000 club.

MID’s wages also appear generous when stacked against other power utilities, according to the American Public Power Association’s 2015 salary survey. For example, a journeyman lineworker at MID made $51 per hour that year; at utilities of comparable size in Western states, the median for that job was $44. An experienced MID dispatcher got $59 per hour, while the median in Western states was $47.

In 2015, MID General Manager Greg Salyer was paid $202,230. The median salary for that job in the West was $195,458, although the median for general managers of large utilities throughout the United States was $307,282. In 2016, Salyer got $225,599.

Salyer asked in April soon to step down to senior assistant general manager. The MID board will let him keep the same salary – now $236,188 – and expects to pay about the same to whomever replaces him.

TID General Manager Casey Hashimoto received $235,880 last year. Salyer’s total package was more costly to taxpayers ($342,266, to Hashimoto’s $329,695), however, because of MID’s lavish benefits.

By comparison, Modesto’s city manager in 2016, Jim Holgersson, cost taxpayers a total of $266,351, including $219,860 in wages. Turlock paid its city manager, Gary Hampton, a wage of $197,880, and with benefits, his package cost taxpayers $261,371.

MID benefits second to none

MID benefits ($54,499 per worker) are second to none, and cost taxpayers more than twice the average of cities in our area ($25,974).

MID pays employees’ entire premiums for vision and dental care and all life insurance and long-term disability insurance premiums. Workers pay 10 percent of health insurance.

MID used to cover employees’ entire pension premiums. After The Bee reported on the district’s alarmingly high rate of unfunded liability in 2011, MID changed terms for its defined benefits plan, and workers hired after January 2013 share the costs.

The unfunded portion continued to grow anyway, from $60 million in 2011 to $68 million now. But MID’s assets have grown even faster; while the district could cover only 70 percent of benefits promised to employees and retirees in 2010, it now can cover 77 percent.

Unfunded pension liabilities among state and local governments amount to $41,219 for every home in the United States, Forbes reports.

MID employees in 1982 opted to leave Social Security; the district replaced that income source with a supplementary retirement plan with defined contributions. Workers put in 5 percent of their pay, the district matches it and employees can direct how the money is invested. They also can put money into a deferred compensation plan similar to a 401(k).

In 2015, MID paid pensions of more than $100,000 each to 10 retirees and one surviving spouse; TID had seven in that category. Retirement pay is tied to a consumer price index and continues growing; for example, former controller Jake Sonke’s MID pension was $113,400 in 2011, and now it’s $124,795. The district’s highest pension goes to former longtime general manager Allen Short, who retired at the end of 2012 and was paid $151,000 in 2015.

Pensioners include Larry Byrd, a former lineman and reservoir tender who retired before his election to the MID board in 2011. In 2015, his pension brought him $42,737, and he also earned the usual $12,000 board pay.

Byrd initially abstained from salary and benefit decisions to avoid a potential conflict because his son is an MID line construction supervisor. But the California Fair Political Practices Commission cleared him to participate in late 2012, and he has voted for two pay increases since. The latest granted raises of 2.5 percent in 2014, 2.75 percent in 2015 and 2.75 percent last year. MID paid Byrd’s son $142,077 in 2016, and his benefits cost another $85,837.

Labor and benefit costs are only 17 percent ($79 million) of MID’s $456 million 2017 budget, Williams noted. The district spends far more – $221 million – to generate electricity, and to buy it from others when needed.

Water districts offer most generous pay

Other notes of interest from The Bee analysis:

▪ Of 26 agencies in The Bee’s analysis (17 cities, four counties and five water districts), more than half (14) are spending more than $100,000 a year on average per employee, in salary plus benefits.

▪ Of the three categories in The Bee’s analysis – cities, counties and water districts – the latter spends far more per employee on salaries, benefits and total compensation. For instance, average total compensation for area water districts came to $125,877, compared to $100,799 for counties and $97,793 for cities.

▪ The highest paid executive among local water agencies was Oakdale Irrigation District General Manager Steve Knell, who received $248,114 last year. He manages 75 employees, compared to MID’s 488.

▪ Among counties, San Joaquin Chief Executive Officer Monica Nino – a Modesto native who formerly helmed Stanislaus County – pulled down the highest pay at $306,423. Next came Stanislaus CEO Stan Risen ($296,783), who will retire Aug. 11.

▪ Modesto, population 212,175, has nearly three times more people than Turlock (72,796) and four times more than Ceres (48,278). But city hall employees cost Turlock and Ceres more in salary and benefits ($117,371 and $117,000) than Modesto ($108,833).

▪ Average pay in Stanislaus County government ($60,381) is less than in neighboring Tuolumne County ($64,317), even though Stanislaus’ population is 10 times bigger (541,560 to 53,804). In terms of salary plus benefits, Merced County (population 268,672) pays far more ($106,146) than the larger Stanislaus ($88,003).

▪ Average pay at 17 city halls in The Bee’s area ($71,818) compares poorly with the statewide average of $99,111.

▪ The same is true of counties in this area: $65,298, compared to the $77,276 statewide average.

(Source notes: Transparent California used full-time employment data for this report, which focuses on average pay and benefit costs to consumers. For cities and counties, Transparent California’s website displays median pay and benefits, or the middle value between highs and lows. Pension data for 2016 are not yet available. The California State Controller’s Office recently published 2016 data for cities and counties, but numbers for special districts – including water agencies – won’t be posted until September. The controller does not furnish workers’ names and does not filter out part-time data. Population estimates are from the U.S. Census Bureau.)

Garth Stapley: 209-578-2390

Lobbying effort

As usual, the Modesto and Turlock irrigation districts flew representatives to Washington, D.C., earlier this year to attend big water and power conferences and to rub shoulders with lobbyists and Congressional figures.

  • TID – which gets twice as much water as MID from the Tuolumne River, because it’s twice as big – sent two employees this year. The trip cost TID $6,800, or $3,400 per person.
  • MID sent four employees plus all five of its elected board members, costing taxpayers in the Modesto area a total of $33,547 for expenses such as airfare, hotel rooms, meals and conference registration fees. That’s $3,727 per person.
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