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Sacramento legislators are considering a potential bill that would place limits on the portion of executive salaries that state utilities — including San Diego Gas & Electric — could force their ratepayers to cover, the San Francisco Chronicle is reporting.
The proposal would place a soft cap on the salaries of top executives at $348,000, or twice the salary of the California governor. Utilities would still be allowed to offer higher compensation, but anything in excess of the cap would have to come from corporate profits instead of utility customers’ monthly bills.
“Let the shareholders pay whatever they want — but not the ratepayers,” Bob Gnaizda, a lawyer for the National Asian American Coalition, the Black Economic Council, the Latino Business Chamber of Greater Los Angeles, as well as a former advisor to governor Jerry Brown, told the Chronicle. “It’s time for the ratepayers to say ‘no.’”
The paper points out that a focus on income inequality brought about by the Occupy movement and public outrage over a $34.8 million retirement package for Pacific Gas & Electric CEO Peter Darbee make the current environment a good one for passing such a bill.
There would be, however, an “out” clause for utilities to shift the burden of executive pay back to customers. The power companies would be allowed to lobby the California Public Utilities Commission for permission to bill ratepayers for executive compensation, but such a process would involve a public hearing and require utilities to demonstrate that pay packages in excess of the cap were both necessary and that billing ratepayers rather than shareholders was appropriate.
Sacramento legislators are considering a potential bill that would place limits on the portion of executive salaries that state utilities — including San Diego Gas & Electric — could force their ratepayers to cover, the San Francisco Chronicle is reporting.
The proposal would place a soft cap on the salaries of top executives at $348,000, or twice the salary of the California governor. Utilities would still be allowed to offer higher compensation, but anything in excess of the cap would have to come from corporate profits instead of utility customers’ monthly bills.
“Let the shareholders pay whatever they want — but not the ratepayers,” Bob Gnaizda, a lawyer for the National Asian American Coalition, the Black Economic Council, the Latino Business Chamber of Greater Los Angeles, as well as a former advisor to governor Jerry Brown, told the Chronicle. “It’s time for the ratepayers to say ‘no.’”
The paper points out that a focus on income inequality brought about by the Occupy movement and public outrage over a $34.8 million retirement package for Pacific Gas & Electric CEO Peter Darbee make the current environment a good one for passing such a bill.
There would be, however, an “out” clause for utilities to shift the burden of executive pay back to customers. The power companies would be allowed to lobby the California Public Utilities Commission for permission to bill ratepayers for executive compensation, but such a process would involve a public hearing and require utilities to demonstrate that pay packages in excess of the cap were both necessary and that billing ratepayers rather than shareholders was appropriate.