South Carolina Taxpayers Not Served By Agency Head Salary Hikes

December 10, 2012

Inside Insight

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Editor’s Note: The following column was submitted by Nerve Citizen Reporter Tom Hatfield of Hilton Head, who also is a member of the S.C. Agency Head Salary Commission.

The S.C. Agency Head Salary Commission met in Columbia on Nov. 13 to finalize discussions on salary increases for the 81 state agency heads, including all college and university presidents.

The Hay Group was hired at a cost of $100,000 to conduct a study comparing the agency heads’ salaries to the pay of other state public- and private-sector positions. This included a personal interview with each agency head or university/college president, and a comprehensive review of the degree of responsibility of each position. It was accepted by the commission that the Hay Group’s methodology was good.

The Hay Group recommended, and the commission agreed, to increase the salaries of agency heads and college presidents by 7 percent, and university presidents by 8 percent. The vote for the former was 7-1; and for the latter, 6-2. I voted no in both cases, and Rep. Mike Pitts voted no for the increase for university presidents.

It is this writer’s opinion that the Hay Group’s study was incomplete in that it did not take into account the “perks” of each position. That includes, but is not limited to: salary; health, disability and other insurance; pension benefits; an automobile with all expenses paid; and, in some cases, (university presidents) housing. It was therefore impossible to determine their real gross income, especially when comparing agency heads’ salaries with similar positions in other states or the private sector.

Recently, most state employees received a 3 percent wage increase. However, I found no evidence that agency heads should earn 4 or 5 percentage points more than the people they manage. One wonders how long it will take for the state employees to ask why they received a 3 percent increase and their bosses 7 or 8 percent, and demand the difference.

The Hay Group also contended that executives in the private sector earn more than those in the public sector. That is simply not true, especially if the total cost of each executive is taken into account.

Lastly, the Hay Group did not provide any evidence that South Carolina has difficulty finding qualified candidates for these positions based on the salaries offered. Also, to date, none has left because of an insufficient salary.

It is the opinion of this writer that the commission did not serve the taxpayers of South Carolina well by agreeing to these increases.