California State Controller’s Employee Pay Tracker Grossly Understates Actual Compensation

California state controller John Chiang has unveiled a website that tracks public employee pay. Unfortunately, the website provides grossly misleading information. The data compiled and summarized on this website report average wages that are literally one half to one-third the amount of total compensation actually earned by California’s state and local public servants. The impact of this will be to further obscure the reality of just how much California’s public servants really make. If you go to the state controller’s website and download the raw data spreadsheets several problems become immediately obvious:

(1) The records are not sorted by city or county, so it is impossible to look at the information – or extract the information for serious analysis – for any one city or county. Everything is mixed up.

(2) The records include columns for overtime and “other pay,” but there is ZERO data in them. Anyone who has reviewed public pay records knows that, for example, often the “other pay” is equivalent to 50% or more of the base salary, and overtime can also often equal as much as 50% or more of the base salary. The pay numbers summarized on this website are therefore grossly understated.

(3) The state controller’s reported pension contributions, on average, added up to 3.5% of city payroll and 2.9% of county payroll, which is absurdly understated. Payroll data obtained by the California Public Policy Center’s study showed that Anaheim’s pension contribution was 26% of direct pay (including overtime), and San Jose’s pension contribution was 41% of direct pay (including overtime). As a percent of total compensation, Anaheim’s pension contribution was 17%, and San Jose’s pension contribution was 26%. These amounts, far greater than what the state controller’s data suggests, are typical of California’s cities and counties, and do NOT take into account how much pension costs are going to increase once the pension funds lower their projected earnings.

(4) It is also clear from viewing the raw data that tens of thousands of part-time and temporary positions are included in the records. Including data for part-time workers dramatically distorts the averages downwards.

The casual visitor to this website will view the interactive map, click on their city or county, and see the “average wages” figure, thinking it is representative of what these employees make. But reporting wages while including part-time workers and while excluding the costs of benefits, overtime, and other pay, results in extremely understated averages. Total compensation, accounting properly for all these factors, is the only accurate way to assess how much an average worker really earns. Here is the data for three cities, comparing “average wages” as reported by the State Controller, vs. “average total compensation,” using actual payroll data obtained by the California Public Policy Center from the same three cities:

State Controller: Anaheim city worker’s “average wages” = $53,927.

Truth: Anaheim City worker’s average total compensation = $146,551.

State Controller: Costa Mesa city worker’s “average wages” = $71,379.

Truth: Costa Mesa city worker’s average total compensation = $146,863.

State Controller: San Jose city worker’s “average wages” = $61,308.

Truth: San Jose city worker’s average total compensation” = $149,907.

The state controller’s “average wages” disclosures can be viewed here:

http://publicpay.ca.gov/Reports/Cities/Cities.aspx

The California Public Policy Center’s studies on total compensation, including actual downloadable spreadsheets provided by these three cities, can be found here:

http://www.californiapublicpolicycenter.org/cppc-studies/

Merely averaging base wages paid, without including the costs for overtime, “other pay,” and employer paid benefits, is not an accurate measurement of how much someone makes. And the much higher total compensation figures reported by the CPPC still do not take into account what’s going to happen to required pension fund contributions when CalPERS and their counterparts finally abandon the fraudulently optimistic projection of 7.5% annual returns on the pension funds. As it is, the state controller has, for example, mislead viewers into thinking the average worker for the City of Anaheim only makes $53,927 per year, when in reality the average worker for the City of Anaheim makes $146,551 per year in total compensation. This is shameful deception.

The fact that the State Controller has gone to this much trouble to produce an overwhelming mass of data that, in fact, understates the amount our public servants make by at least a factor of 2x, undermines the credibility of the office, to put it mildly.