Rancho Santiago Community College District Chancellor Raul Rodriguez’ benefits package when he was hired in 2010 included reimbursement for moving expenses, plus a $30,000-a-year “relocation allowance” to allay the cost of his move from Stockton to Santa Ana.
Seven years later, not only is Rodriguez still receiving that relocation allowance each year, but the Board of Trustees has voted to make it part of his salary.
The board voted Aug. 14 to amend Rodriguez’s employment contract and defined his existing relocation allowance as part of his salary, raising it from $260,000 to about $290,000 a year.
Although Rodriguez is not taking home any more cash than he did before, the increase to his salary could boost his pension and what he is entitled to receive on retirement.
By designating the relocation allowance as part of his salary, the contract also could conflict with pension regulations that specifically prohibit housing and travel allowances from counting toward a pension.
Relocation allowances are typically a benefit given to reimburse an employee for the cost of moving when accepting a new job.
When Rodriguez accepted the role of chancellor in 2010, his contract provided reimbursement for his moving expenses as well as a $2,500 per month relocation allowance.
Asked why he has continued to receive a relocation allowance for seven years after his initial move, Rodriguez said it’s a matter of “semantics.”
Rodriguez said that while board trustees wanted to call the benefit relocation pay, the money is meant as a housing allowance to help him afford the higher cost of living in Orange County.
“I needed a sizeable spike in pay,” Rodriguez said. “I need a housing allowance.”
Asked why, in subsequent amendments to the contract, he never changed the name of his relocation benefit to be called a housing allowance, Rodriguez said “I could have done it that way, I don’t know.’
The chancellor’s relocation pay has sparked consternation among members of the district’s faculty union, known as the Faculty Association of Rancho Santiago Community College District or FARSCCD, which has been heavily critical of Rodriguez.
The union’s criticism of the chancellor often is featured in its monthly newsletters, including one in April which touched on the relocation allowance.
“THE TAXPAYERS HAVE PAID THIS AMOUNT FOR THE LAST SEVEN YEARS ($210,000 AND COUNTING),” the newsletter reads. “WHEN WILL THIS THEFT OF TAX PAYER DOLLARS END? WHEN WILL THE COLLEGES STOP CUTTING PROGRAMS, FIRING PERSONNEL??”
Union advocates also have sought to contrast Rodriguez’s contract with the way the district has responded to budget issues.
Also at the Aug. 14 meeting, the board approved a preliminary proposal to the faculty union, which included increasing the number of units faculty are required to teach, without a proposed pay increase.
Morrie Barenbaum, treasurer for the faculty union, questioned whether Rodriguez’s contract amounts to pension spiking, an illegal tactic whereby public employees boost their salary in order to increase their pension payout, usually done right before retiring.
“They want us to do more work for the same amount of money,” Barenbaum said. “For him to increase his base salary…he’s going to get an increase to his pension for the rest of his life.”
Rodriguez, 65, said he does not intend to retire anytime soon.
“It’s not [pension] spiking if I don’t retire,” Rodriguez said. “It’s not trying to game the system, it’s just giving me fair compensation for the experience that I have.”
Ruben Smith, general counsel for the school district, said there was nothing “illegal done by the board in structuring the deal this way.”
Smith emphasized the chancellor’s total compensation hasn’t changed, since he has already been receiving the relocation pay and it’s now being redefined in his contract.
“The whole idea here was to avoid a political football,” Smith said. “The board wanted to make it clear his overall compensation stays the same…and yet he’s still the lowest paid chancellor in the county.”
Rodriguez is a member of the California Public Employee Retirement System, or CalPERS.
According to CalPERS, housing and relocation pay generally is not allowed to count toward one’s pension.
“Generally benefits that are folded into a member’s salary are not allowed to be included in a member’s pension,” said Amy Morgan, a spokeswoman for CalPERS. “Specifically, relocation and housing allowances are types of compensation that are prohibited toward pension pay under the law.”
The agency has begun a review of Rodriguez’s contract, which can take up to six months. If they determine the contract conflicts with their rules, the $30,000 added to Rodriguez’s contract may not count toward his final pension payout.
Rodriguez says that there should be no problem.
“I think this has been done many times, once you pull [the allowance] into the base salary, it’s not a housing relocation anymore, it’s just part of your base salary,” Rodriguez said.
Board President John Hanna also defended the chancellor’s contract, noting the changes won’t change how much cash the chancellor takes home at the end of the year.
“His compensation is the same. So if somebody has consternation, I think there may be other motives involved,” Hanna said. “They may not like the chancellor, they may not like that he’s not rolling over to certain demands.”
Hanna said the latest agreement also shortens the chancellor’s contract from a three- to two-year contract to “increase accountability.”
Contact Thy Vo at firstname.lastname@example.org or follow her on Twitter @thyanhvo.