Chamber releases president/CEO salary, benefits data
March 24, 2011
OPINION By SLO Chamber staff
The San Luis Obispo Chamber of Commerce released data today on the salary and benefits of retiring President/CEO Dave Garth and the salary and benefits package being advertised for his replacement.
San Luis Obispo Chamber of Commerce President/CEO Dave Garth.
The data release comes in response to a request from Erik Baskin, president of the local San Luis Obispo Firefighters Association, the union representing non-management fire department employees.
The Chamber and the Firefighters Association are on opposite sides of the current binding arbitration controversy. Binding arbitration requires that salary, benefits and working condition disputes between the city of San Luis Obispo and the police and firefighter’s unions be resolved by an outside arbitrator, who is unelected and unaccountable to the voters. The arbitrator is not permitted to find middle ground between the two parties but instead must select between the last best offers from either side on every issue of contention.
This has led to unsustainable salary and benefits in San Luis Obispo and the very few California communities that continue to have binding arbitration in their city charter. Binding arbitration, in the Chamber’s view, is undemocratic because it removes the ability for our elected representatives to make decisions in the best interest of all of the city’s employees and the community they serve.
Currently, the Chamber’s president/CEO’s base salary is $120,000 per year. Last year, Garth received a performance bonus of $6,868. He is an exempt employee and does not receive overtime pay. Garth’s benefit package includes medical insurance (but no vision or dental) life insurance, auto allowance, cell phone, service club membership and retirement contribution. Garth’s pay and benefits have not been increased in the last three years.
The Chamber offers a tax qualified 401(k) defined contribution retirement plan to all of its full-time employees. For the last several years, the Chamber has contributed the equivalent of 10 percent of an employee’s gross earnings to their retirement account; the amount of this contribution is determined annually by the Board of Directors, is not guaranteed and has never exceeded 10 percent. The employees are not required to contribute to their retirement account. As is the case with all private-sector employees, Chamber employees do contribute 5.65 percent of their earnings to their Social Security and Medicare accounts.
Garth will be retiring at the end of June after 38 years as president/CEO of the Chamber. The earnings from his Chamber retirement account combined with Social Security will likely net him slightly less than 50 percent of his highest year’s earnings. That amount is not guaranteed and will vary with fluctuations of financial markets.
By comparison, public safety employees in San Luis Obispo have a defined benefit retirement plan and at age 50 are guaranteed to get three percent of their highest year’s earnings for each year worked. That means an individual starting at age 20 and retiring at 50 would receive 90 percent of their highest year’s earnings for the rest of their life. On average, that would be for more than 30 years or, based on life expectancy, longer than their working life.
The Chamber is currently conducting a search for Garth’s replacement. After researching salary and benefits data of chambers in similar-sized communities, the search committee and the San Luis Obispo Chamber Board of Directors realized that Garth’s salary and benefits package was not competitive, and that it might be necessary to offer a higher salary to attract a new president/CEO of Garth’s caliber.
Even though the San Luis Obispo Chamber of Commerce is recognized nationally for its membership size and program excellence, and Garth is recognized as a leader in the chamber industry, Garth’s salary was significantly below the median for chambers of comparable size.
The San Luis Obispo Chamber of Commerce is a $1.5 million organization with 1,400 members and 15 employees. The salary being advertised for the new president/CEO is $110,000 to $150,000 depending upon experience and qualifications with a benefit package equivalent to Garth’s.
According to the State Controller’s website, about 70 percent of San Luis Obispo’s firefighters earned more than Garth in 2009.