Mounting criticisms of retirement pay for the CEO of the Salinas, Calif., public hospital district highlight the role of "supplemental" payments on top of basic retirement benefits, according to a report by the Los Angeles Times.
President & CEO Samuel Downing received a $3 million retirement payment when he turned 65 two years ago, but he continued working at his $668,000-per-year job for another two years. After he retires this week, he will receive a supplemental payment of nearly $900,000 on top of his regular pension of $150,000 per year.
Officials at the hospital district said they used an independent consultant to make sure Mr. Downing's package was within market practice. They said the supplemental payments were a way of compensating Mr. Downing without significantly increasing his base salary or awarding him bonuses.
The retirement package is unusually high compared with CEOs at several other hospital districts in the state. The district receive funding from a variety of both public and private sources.
Mr. Downing's retirement payments were renegotiated several times during his career, which stretches back to the 1970s. They were funded through the hospital's own pension accounts and not through the California Public Employees' Retirement System, which limits the size of one-time pension payments.
A private watchdog group has called for stricter California pension rules, saying the state's retirement plans are "dangerously underfunded, the result of overly generous benefit promises, wishful thinking and an unwillingness to plan prudently."
Read the Los Angeles Times report on hospital CEO compensation.
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President & CEO Samuel Downing received a $3 million retirement payment when he turned 65 two years ago, but he continued working at his $668,000-per-year job for another two years. After he retires this week, he will receive a supplemental payment of nearly $900,000 on top of his regular pension of $150,000 per year.
Officials at the hospital district said they used an independent consultant to make sure Mr. Downing's package was within market practice. They said the supplemental payments were a way of compensating Mr. Downing without significantly increasing his base salary or awarding him bonuses.
The retirement package is unusually high compared with CEOs at several other hospital districts in the state. The district receive funding from a variety of both public and private sources.
Mr. Downing's retirement payments were renegotiated several times during his career, which stretches back to the 1970s. They were funded through the hospital's own pension accounts and not through the California Public Employees' Retirement System, which limits the size of one-time pension payments.
A private watchdog group has called for stricter California pension rules, saying the state's retirement plans are "dangerously underfunded, the result of overly generous benefit promises, wishful thinking and an unwillingness to plan prudently."
Read the Los Angeles Times report on hospital CEO compensation.
Related Articles on Hospital CEO Compensation:
Miami's Jackson Health System Announces $590K Salary for New CEO
Community Health Systems' CEO Compensation Nearly Doubled in 2 Years
8 Statistics on Executive Compensation at Non-Profit Hospitals