SALT LAKE CITY — A revamping of retirement benefits for top Utah Transit Authority bosses, called the final phase of executive compensation reforms, is raising concern about why other employees aren't getting the same deal.
The changes approved by the UTA board are intended to reduce the overall amount contributed toward executives' retirement plans, but a few will receive $7 for every $3 they put in, more than three times what other employees get.
"It is less than before, but it's still not right," said the only UTA trustee who voted against altering the two plans, North Ogden Mayor Brent Taylor. "It's still a benefit that's far better than we're giving to the rest of our employees."
The better benefits for executives were also questioned by Rep. Mike Schultz, R-Hooper, co-chairman of the Legislature's Transportation Governance and Funding Task Force that may eventually recommend restructuring UTA.
"I know it's the same for executives at the state as it is for the guys out working on the roads repairing potholes, the same across the board," Schultz said, acknowledging he did not yet know the details of the UTA plans.
The state offers its public employees the same types of retirement plans as UTA, but contributions from state coffers are limited to $676 annually — plus an extra 1.5 percent for employees hired before 2011 — no matter their job title.
For some executives at UTA over the years, the agency's contributions have added up to more than $40,000 a year. Even under the newly revised plans, the average cost per participant annually will be just over $12,400 in all but one case.
The exception is UTA President and CEO Jerry Benson, who is earning a base salary of $274,000 and is expected to receive $19,180 next year based on the higher match.
Schultz said the transit agency's differing plans for executives not only hurts employee morale, "it kind of hits at the broader issue and that's the trust around UTA. I think that's more or less what we're talking about and trying to handle."
The two-year task force is taking up the oversight and funding of UTA as part of its charge after a series of critical legislative audits of the transit agency, as well as an ongoing federal investigation focused on transit development.
While UTA has signed a nonprosecution agreement with the U.S. Attorney's Office, the agency agreed to up to three years of federal monitoring. The agreement referenced the same issues with executive compensation cited in the audits.
Three years ago, a legislative audit detailed the "extra compensation" executives and other senior-level officials at UTA received through their own asset management plan, known as a 401a plan, that also had a 7 percent match.
The audit found UTA's average contribution to the plan on behalf of the bosses was more than $15,500 in 2013, on top of the money also put into the agency's retirement plan for all employees, a 457 plan.
Unlike what the rest of the UTA workforce gets — a $2 match for every $3 employees set aside — the agency contributed the maximum amount allowed under IRS rules on behalf of the executives and officials, an average of nearly $22,000 in 2013.
The changes approved to the plans last week are anticipated to save UTA a total of just under $263,000 annually once they take effect next year by limiting participation in both plans and switching to a matching contribution in the 457 plan.
Now, instead of depositing an average of $19,550 for each of 11 executives to that plan, UTA will pay in an average of $12,405 for 7 executives, if each chooses to contribute the 3 percent required for a 7 percent match.
The executives-only retirement plan will have only a single participant starting in 2018, down from the current 11. That's Benson, who stopped participating in the other plan when he was named to the top spot last year.
The annual cost of the 401a plan will be sliced from just under $154,000 — at an average cost per executive of nearly $14,000 — to $19,180, all of that going toward Benson's retirement fund.
The president and CEO has seen his retirement contribution from the agency drop by about half, from the nearly $40,000 UTA gave him in 2015 when he was chief operating officer.
UTA, which had done away with big performance bonuses for executives after the 2014 legislative audit, also will no longer give executives a $6,000 annual transportation allowance starting next year as a result of the board action.
Benson told the board before the vote that the reductions in benefits are adding up.
He said the retirement changes and transportation allowance together mean around a $30,000 pay cut on top of the $20,000 or so that could have been earned as a performance bonus before that program ended.
"There are people in this organization who have been willing to take a reduction in pay to the tune of about $50,000," Benson said. "So this is a big change that has real impact on real people, and I'm very grateful we have the team we have here."
He said it's common practice to provide a supplemental retirement benefit for top executives, and UTA will now be able "say in good faith that our compensation is consistent with the labor market."
Salt Lake City gives 17 top-ranking officials, including Mayor Jackie Biskupski, an extra 3 percent toward their retirement on top of the 10 percent set aside for most city employees, city spokesman Matthew Rojas said.
For the mayor, that's just over an $18,000 annual contribution. But that number jumped to nearly $39,000 for the city's highest paid position, Salt Lake City International Airport director, based on recently retired Maureen Riley's salary.
"To the city, it's wanting to make sure we can attract top talent," Rojas said. "It's not a large contribution."
Taylor, however, said he hasn't seen a difference in retirement benefits in his experience in the military and the public sector. Before voting against the changes to the UTA plans, he pointed out that a general and a private both receive the same match.
"I think that is what is fair in public service," the North Ogden mayor said later. "I just feel we missed an opportunity to really show solidarity to the employees and to the taxpayers."