Santa Ana City Council members are scheduled Tuesday to discuss a possible 5 percent performance bonus for City Manager David Cavazos, a bump that some say is well deserved, but adds to a compensation package that is already among the highest in the state for public sector executives.
If approved, the bonus would be calculated on his base salary of $315,000 and come to an additional $15,750. Cavazos’ employment contract calls for council members to each year determine whether he deserves a pay bump, and if so, how much.
Supporters of the bonus say Cavazos, who was hired in October 2013, has already paid for it many times over by crafting a new budget forecast that shows multi-million dollar surpluses over the next five fiscal years. The previous estimates showed a structural deficit for the same period.
“You want to keep a guy like that,” said Councilman Sal Tinajero. “I think people should be paid what they’re worth. This guy’s worth more than $315,000 in my book.”
But Councilwoman Michele Martinez said she is uncomfortable about how the process has played out so far. She says Cavazos has managed to turn the normal employer-employee dynamic on its head, defining for himself how much the bonus should be and what he did to earn it.
Cavazos touted his accomplishments over the past year in an email to council members with a 21-page document dubbed the “7 Pillars of Success.” Among the highlights: downtown parking meters that accept credit cards, the renegotiation of federal detainee contracts to reduce the city jail’s financial deficit, and over $10 million in new grant funds.
But most of all, he is taking credit for $62 million in expected general fund surpluses through fiscal year 2018-19.
“In a month, I turned it around,” Cavazos said in an interview with Voice of OC. “I said no, we don’t have a structural deficit anymore.”
Martinez says Cavazos is taking all the credit for what she describes as a "team effort,” adding that the city’s positive financial position has more to do with hard choices the council made before Cavazos arrived, like outsourcing the city’s 128-year-old fire department.
“Who defines success for the city manager?” Martinez said. “Right now, in many respects he’s trying to define that and why he merits a bonus.”
Martinez also points out that one of the ways Cavazos arrived at his rosy budget projections was to cut out future raises to rank-and-file employees, which means he is at least in part justifying his pay raise by removing raises for others from his forecast.
Martinez said performance based bonuses should be offered “across the board” to employees because otherwise it “creates the haves and the have nots.”
Cavazos said he took employee pay raises out of the budget projections because he didn’t want to have to face the community and tell them there’s no room in the budget for city services. That would force him to choose between his “two favorite children” – the residents and the workers, he said.
“What do you think [residents] are going to do?” Cavazos said. “They’re going to say boooo.”
Cavazos also said that he wouldn’t accept a bonus that exceeds bonuses other city executives get (5 percent) because it could hurt worker morale.
The decision on a bonus is “entirely in the hands of the City Council,” Cavazos said. But he went on to say that the council brought him in to achieve certain goals, and indicated that Martinez’s approach of adding new tasks to achieve the bonus was akin to “moving the goal-line,” and he said “that’s not fair.”
Martinez says Cavazos’ large compensation package was intended to pay for the accomplishment of those initial goals.
When adding other benefits -- like a city car, housing reimbursement and relocation allowance, among others – to his $315,000 base salary, Cavazos's compensation totaled over $550,000 in the first year, according to city documents.
On top of that, he is also collecting a $235,863 pension from the city of Phoenix, according to the Arizona Republic, though he told the newspaper about half of that would go to his ex-wife.
All told, taxpayers in Santa Ana and Phoenix this year are paying Cavazos nearly $800,000 in salary, benefits and pension payments.
Council members Vincent Sarmiento, Roman Reyna and Angelica Amezcua did not return phone calls for comment. Councilman David Benavides couldn’t be reached for comment.
However, Tinajero said that he knows he doesn’t “stand in the minority” by supporting Cavazos’ bonus.
Tinajero speculates that Martinez’s points are rooted in personal resentment and said it is “demeaning” of other council members to say Cavazos set goals for the bonus, and not the council.
“She’s a little bit upset at David because she doesn’t get everything she wants,” Tinajero said. “The items we discussed as far as his evaluation are items I would have asked for to begin with.”
Martinez says the points she raises have nothing to do with personal feelings and credits Cavazos with being an effective bureaucrat, implementing city initiatives that have been stuck in the pipeline as management changed hands multiple times in recent years. She also said Cavazos has dealt fairly with all seven council members.
“My colleagues think I dislike him. But that’s far from the truth,” Martinez said. “It’s my job as a council member to hold him accountable… there are things that have seen progress, but there are other things where I’m concerned.”