Public Service for Profit

Jeff Schapiro of the Richmond Times-Dispatch has the latest example of an outrageous payment to a public servant: the 2x salary severance payment to the former head of the Virginia Retirement System (VRS). On the editorial page, a VRS board member who represents teachers bemoans justifying this action to the low-paid beneficiaries of the retirement fund.

Maybe it’s just me, but it seems like every week we’re seeing state or local officials receiving huge payments or spending large sums of money on questionable activities. School superintendents are hired then summarily fired (with severance) with alarming frequency. High officials travel around the globe to learn about the latest thing, but rarely implement anything new.

Something’s wrong. Hiring practices and/or expectations are out of whack. We ought to stop a lot of this “national search” balderdash and start focusing on developing talent that can move up within organizations. We ought to select promising candidates from a diversity of backgrounds, not insist that hires have held the same job somewhere else (and somewhere else before that). We hire high-priced retreads who are represented by agents that negotiate lavish (by government standards) perks and severance packages upfront. We don’t check backgrounds as well as we should. We frequently don’t give new hires enough time to establish their leadership and we don’t start overseeing financial matters until they reach scandalous proportions.

I don’t want to hear this “you have to pay for talent” line, either. Sure you do, but there’s a price break point. We all know that the new outsider comes in and leans on the existing staff for everything. Surely there’s someone in every organization that could run the place as well as the high-priced resume. It’s tough to check out the high-priced resume; it’s a lot easier to know what someone who’s been in the organziation many years can do.

How anyone can claim the mantle of “public servant” while simultaneously grabbing outlandish cash and perks is beyond my comprehension.

One specific issue regarding VRS was interesting: Del. Leo Wardrup, Jr., R-VA Beach, criticized the Attorney General’s office for not monitoring the VRS more closely. Is that the AG’s job? Here’s a real live issue for the two AG candidates to debate, as opposed to “top-cop” peripherals.

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  1. Jim Bacon Avatar
    Jim Bacon

    Will, you raise a legitimate issue. On the one hand, Virginians want (or should want) to have top executive talent running their government agencies, even if it means paying more. One leader like Philip Shucet can save tens (hundreds) of millions of dollars even while improving performance at VDOT, the state’s largest agency. There is no way that we could have paid that man enough for what he did.

    On the other hand, it isn’t always pay and perks that motivate people to go into public service. It certainly wasn’t in the case of Shucet, who had to take a pay cut. Indeed, it almost makes you wonder, if it takes outrageous perks like a 2X severance package to lure someone into public service, then something is wrong. Arguably, it’s a tip-off that the person is taking the job for the wrong reasons.

  2. Will Vehrs Avatar
    Will Vehrs

    VDOT launched a national search and ended up making the inspired choice of Shucet–a guy from Newport News.

    Maybe we launch these “national searches” only after we’ve exhausted the possibilities in our own backyard.

  3. Not Mark Rozell Avatar
    Not Mark Rozell

    Will: I agree with your premise, but I think promoting from within organizations to the top position only slows things down. That person has made friends and enemies on the way up, and will be more beholden to those prejudices. That’s why organizations often choose someone from the outside – he or she can make changes more freely without the baggage that comes from being inside an organization for so long.

  4. Will Vehrs Avatar
    Will Vehrs

    NMR, I agree that you’ve made the classic argument against promoting from within. That argument presupposes, I think, that the “organization man” is risk-averse. Once promoted to the top job, the person serves at the pleasure of the Governor or Board, not the current “top gal.” There’s no going back (or shouldn’t be). A strong promoted leader will make clear that things are different with former colleagues and other staffers. Change should not be inhibited.

    Bringing in a new person, as you suggest, may eliminate “baggage.” Of course, often new people bring in their own former underlings from somewhere else or repeat the things they did somewhere else, regardless of whether it’s appropriate. That’s baggage.

    I like the option I suggested of taking a top person from another organization–the deputy director of General Services takes over the Department of Social Services, for example.

    It’s a balancing act. I just believe the “bring in an outsider” option is overused.

    We have interesting situations in Virginia right now that are instructive. At VDOT, an interim chief has been named from the inside, with the promise he’ll get his old job back when a permanent replacement to Shucet is named. At DGIF, former Police Superintendent Massengill was brought in from retirement to clean things up, presumably until a new leader is determined.

    I’d say DGIF probably got the better option.

  5. Anonymous Avatar

    On the AG’s office role, yes, somebody over there gave that board absolutely terrible advice, and it is hard to imagine a payment like that without advice being sought. Most people have no idea what that job entails, but the AG’s office spends far more manhours providing routine legal advice to agencies than it does prosecuting anybody. There was no justification for that massive payout — it is not like there was a contract to be bought out (as is the case with school superintendents sometimes),

  6. Will Vehrs Avatar
    Will Vehrs

    The only indication we have that the AG office was consulted is the word of Alfonso Samper. His credibility is in the toilet, having been cited by JLARC for “procedural and administrative breaches.”

    Maybe the AG gave bad advice, maybe Samper didn’t give them the full story, or maybe he never really consulted them at all. This whole thing is very murky.

  7. Becky Dale Avatar
    Becky Dale

    I went to the JLARC site to find the report but couldn’t find it. There’s a webpage there on VRS: apparently JLARC is required to do periodic status reports on VRS and a legislator’s guide. They also make semi-annual reports on performance of VRS investments. Here’s the page listing the reports:

    One other comment about the article: Freedom of Information Advisory Council conducts FOIA training for anyone who’d like it. They provide it for state agencies and local government bodies. I’m sure the AG’s office could do FOIA training too for VRS, but we already have FOI Advisory Council routinely doing training. They’re the experts.

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