Integrity in the salary process

I submit the following historical summary based on my experience as a member of the Salary Commission in 2003 and 2004, and as a long-time advocate of review and reform in the county’s salary process. My main concern is not with salary figures per se but with the integrity of the process. I suggest that the best way for commissioners to gain understanding of the commission’s challenges and responsibilities is to review the final reports of previous commissions, from 1990 forward, and to study with care the mandate under which the commission now operates as a result of the 2006 charter amendments.

The county had a workable salary process before the salary commission was created in 1988. Prior to 1988 the mayor recommended executive salaries and the council determined those salaries by majority vote. The council set salaries for its successors but could not change their own — i.e. incumbent councilmember salaries. The salary of a department head could not be lower than the highest civil service salary. This rule greatly limited the council’s power over executive salaries, in general determined the range of all executive salaries, and limited the public’s power to influence salary decisions.

Apparently neither the council nor the public was satisfied with the pre-1988 salary process. Accordingly, in 1988 the council proposed, and the voters approved, two major charter amendments. The first eliminated the rule governing department head salaries. The second created the salary commission and gave it the power to set council salaries and recommend executive salaries.

The 1988 changes relieved the council of having to determine council salaries, left wide open the question of how the salary commission should determine appropriate executive salaries, made the salary commission the focal point of conflict between mayor and council over executive salaries, and allowed the public to lobby the council in opposition to pay raises. In 2000, for example, public opposition “persuaded” the council, under threat of being voted out of office, to reject executive raises proposed by the Salary Commission.

The example from 2000 illustrates the fact that since 1988 the salary process has been essentially broken. A systemic problem was created when the term of the salary commission was made concurrent with the two-year term of councilmembers and appointing power was divided between mayor and council, who each had 45 days to appoint three members, with the six then appointing a seventh. Between 1988 and 2006 no commission was appointed in a timely manner and in three cases no commission was appointed at all.

A different kind of problem occurred when in 1994 the commission recommended four 4.5 percent executive raises spread over 2 1/2 years and awarded comparable raises to the council. The council first approved three of the executive raises and later canceled two of the three. The council could not cancel its own raises and for technical reasons the commission could cancel only one of four council raises. The net result was that between 1994 and 1996 the council received three 4.5 percent raises and executives received one 4.5 percent raise, and between 1994 and 2000 the mayor sought vainly to gain the raises recommended by the commission in 1994 or something comparable.

Working with recommendations from the 2003-04 Salary Commission, the Charter Commission proposed, and the voters approved in 2006, charter amendments designed to rectify deficiencies in the salary process. Systemically, the two most important changes approved by the voters in 2006 are, first, appointing commission members to three-year staggered terms and, second, requiring the commission to adopt policies governing its salary-setting decisions. Politically, the most important change is the provision requiring five council votes to veto salary decisions made by the commission, which in turn diminishes the public’s power to influence salary decisions.

In my opinion, with the commission’s increased political leverage comes a corresponding responsibility to represent the public interest by establishing a real and workable linkage between salaries and performance. It is a measure of the commission’s challenge that all previous commissions have recognized the importance of this linkage, but none succeeded in making it an integral part of the salary process.

• Horace Stoessel is retired and a resident of Kapa’a. This commentary, slightly modified, was sent to the Salary Commission.


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