District 9 City Councilman Joe Krier wants to increase Council’s role in determining executive pay and bonuses at the municipally owned water and electric companies. Krier recently filed a Council Consideration Request (CCR) to improve transparency when it comes to San Antonio Water System (SAWS) and CPS Energy top-level executive bonus pay. The CCR comes in response to censure from some council members and the public about the sizable bonuses doled out lately to the utility executives amid their requests to raise customer rates.
Krier says he began hearing complaints from residents in his district nearly from the time he was appointed last November. As the criticisms swelled, Krier decided to take action when he saw two juxtaposing news stories side-by-side; one about SAWS’ recently proposed water supply impact fee increase and the other on the bonus pay awarded to the water system’s CEO Robert Puente. The SAWS Board of Trustees granted Puente a raise from $325,187 to $373,966 and a bonus performance award of $72,832; at the same time they asked developers to shoulder a 116 percent impact fee increase, passed by Council just last week through a “phase-in” approach, as the Current previously reported. Similarly, the CPS Board gave CEO Doyle Beneby $850,000 in salary and bonuses last year while the electric company was increasing monthly consumer electric and gas rates. In deferred incentive pay acquired over the past three years, Beneby made out with nearly $1 million last year.
“I immediately started hearing, ‘Help me understand this’ from constituents all over my district. So, it was time to do something about it,” Krier tells the Current.
The CCR calls for City staff to determine the extent to which Council could exercise greater oversight of CPS and SAWS executive salary increases and bonus pay. (According to Krier, bonus pay and salary increases are decided by the utility boards, with no input from or advance notice to council.)
Krier proposes setting up a council oversight committee to review pay raises at the utilities and suggests compiling a list of 10 comparable city-owned utilities to contrast their CEO bonus pay and processes.
“What we find out about other cities around the country can allow us to more thoughtfully make a judgment on if what we’re doing is reasonable,” he says.
His CCR has the support of council members Diego Bernal (District 1), Ivy Taylor (District 2), Rebecca Viagran (District 3) and Mike Gallagher (District 10), who added their names to the request. Krier expects a response within 30-60 days.
“These utilities are businesses that we own; that San Antonio owns,” says Krier.
“They aren’t traded on the New York Stock Exchange, they are not held by investors. A city-owned water and electric company have a different level of responsibility to citizens, and that’s what is driving me on this.”
SAWS’ Greg Flores says the water system’s board decides CEO bonus pay and the CEO decides employee bonuses. Flores says since Puente took the post in 2008 —with the exception of annual merit awards of $250 or $500—no employee has received a bonus to date. In response to the CCR, SAWS Chairman Berto Guerra points out that the mayor serves on SAWS’ board of trustees, and the rest of the trustees are appointed by Council. In a statement, Guerra writes, “I can assure the Council and the community that our CEO has exceeded his performance objectives in a manner that justifies his total compensation.”
A spokesperson for CPS noted that the utility has already committed to reducing employee incentive pay by 50 percent in 2015 and 2016. And, according to the spokesperson, “CPS Energy welcomes the opportunity to assist the City Council and the proposed sub-committee with any information we can provide relative to CPS Energy’s compensation structure.”