City Utilities of Springfield is in the middle of the road when it comes to pay and benefits, according to a Seattle consultancy that recently conducted a compensation survey for CU.
The public utility provider paid $90,000 to Washington-based Milliman Inc. as part of its ongoing efforts to compare its wages and benefits with industry standards.
The survey reviewed market data for 173 jobs through 31 similar organizations, such as Kansas City Power & Light Co., Knoxville Utilities Board, Show-Me Power Electric Cooperative and Omaha Public Power District.
Milliman found total cash compensation for salaried CU employees was 1 percent behind the 50th percentile. CU’s total value of benefits was estimated at $14,299, which is slightly above the $14,013 middle mark.
CU’s base salaries landed at 4 percent above the 50th percentile among participating groups, while total compensation was 1 percent below the middle mark.
CU General Manager Scott Miller – who sets the high mark with a $335,000 salary – said being in the middle of the road in terms of wages and benefits is right where the utilities provider should be.
“That is per plan. That is what the board expects from us, so that’s what we try to manage to,” Miller said. “The only wild card for us was that everyone had just come through the Great Recession, and we wondered if that was going to have an impact on things. We thought we were managing to the plan, and this just solidified that we are.”
Amy Austin, associate general manager of administration for CU, was one of five people on the committee tasked with selecting Milliman for the commissioned survey, a process planned for every five years. According to Miller, Austin is responsible for ensuring that CU pay and benefits are on par with industry averages.
This year’s results, she said, are very similar to the organization’s most recent compensation findings.
“It was close. We are probably in a better position this time,” Austin said.
Total cash compensation for four of CU’s top administrators are below the 50th percentile when compared to the top executives reviewed by Milliman, but they are above the median pay for executives at 45 similar-size public utility companies surveyed last year by the American Public Power Association. A distinction in the APPA survey is that respondents represented public utilities with annual revenue of $100 million or more, and operating revenue for CU last year was four times that starting base. CU participated in the APPA survey.
At CU, Associate General Manager of Operations Wade Stinson currently earns a salary above $222,000, which is below the median cash compensation of $240,859 at the 50th percentile in Milliman’s survey. Associate General Manager of Electric Supply Steve Stodden is paid nearly $208,000, which compares to the Milliman middleman mark of $244,669. And General Counsel John Black is making roughly $215,000, below Milliman’s 50th percentile for comparative positions at $226,145.
The total compensation at Milliman’s middle spot for general managers was $351,744, besting Miller by around $16,000 per year.
According to the APPA’s broader scope, Miller is earning about $120,000 more per year than the median for top utility executives. The APPA results also skewed down the pay for associate general managers, at $161,000 last year, and directors of power supply and legal counsel to around $145,000.
Separately, Springfield Business Journal gathered executive pay on three public utility providers in similar-size cities in the central U.S. With a city population of 160,000, CU serves on average 95,000 customers in each of its gas, water and electric utility lines.
The top executive at Lincoln (Neb.) Electric Supply earns a salary of $299,900 in the city of roughly 260,000 people. The salary range for Lincoln’s vice presidents of power supply and energy delivery, and its general counsel, is $182,255 to $223,106.
Similar positions at Springfield (Ill.) City Water, Light & Power are paid between $100,000 and $230,620, though it should be noted the GM is an acting position. The home of Abraham Lincoln has a population of nearly 120,000, about 40,000 fewer residents than in Springfield.
In Kansas City, Kan., with a population of roughly 150,000, the board of public utilities pays between $158,000 and $215,000 among its top executives. The utility provider does not employ a dedicated general counsel.
Miller said the Milliman survey provides a superior comparison of salaries than the APPA survey because it includes data from 26 additional industry surveys and comparisons with companies from both public and investor-owned utilities, which regularly compete for talent.
“The APPA survey isn’t a complete survey slice,” he said of the nonfee-based survey.
In its grouping, he added, most public utilities’ salaries are going to come from smaller utility providers – those closer to $100 million in annual revenue.
Milliman was a valuable resource, according to Miller, because it can be hard to compare what CU does with other utilities.
“We are the only utility provider I know of that provides electric, gas, water, broadband and transportation services,” Miller said.
Jeremy Engdahl-Johnson, director of media relations for Milliman, declined SBJ’s interview request citing the company’s policy not to comment on client work.
In the summary section of the survey, Milliman praised CU for hitting its goals.
“Overall, City Utilities has done an effective job of maintaining its total compensation program at or close to its intended market levels,” the summary stated.
