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How we analyzed California’s public employee compensation data

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Making sense of public employee compensation is no easy task. California’s 58 counties and 482 incorporated cities have diverse populations, different costs of living and between 121 and nearly 10 million residents. The Center for Investigative Reporting sought to provide context to understand and compare city and county employee compensation, which generally accounts for more than a third of local government spending.

CIR analyzed data from the California State Controller’s Office, which collects compensation records for nearly all city and county employees in the state. Its database spans from 2009 to 2012 and annually includes as many as 700,000 full- and part-time municipal and county employees and all elected officials. It does not include independent contractors.

CIR used the state’s database to examine how local governments compensate their top officials. We identified the records for city managers, mayors, city council members, police chiefs and city fire chiefs, as well as county administrators, district attorneys, county supervisors and sheriffs.

Employees’ positions sometimes were presented in a straightforward manner, such as “accountant” or “fire chief,” but at other times were obscured by abbreviations, spelling errors or vague classifications, such as “Dept. Head V.”

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The state’s database does not include employees’ names. In some cases, we identified top officials by matching their reported compensation to separate compensation records that included employees’ names. We identified others by contacting cities and counties directly. In some communities, not all positions were reported or could be identified.

Payday chart - Bell
Payday chart - SF

CIR contacted cities, counties and organizations that represent or recruit local government leaders to identify factors that influence pay. Many said they considered the pay of similar positions in neighboring or similar communities, as well as cost of living, staff sizes and budgets.

We conducted a statistical analysis to determine what demographic factors are linked to top officials’ pay. Our analysis found that the two factors that most strongly correlated with compensation were population size and median rent.

The compensation data we used was the most uniform metric available in the state’s database: total wages subject to Medicare taxes.

Those wages are the total of regular pay (typically wages or salary); overtime pay; one-time payouts of unused vacation and sick time; and other taxable pay, such as car allowances and bonuses. Wages subject to Medicare taxes tend to be lower than gross wages because they do not include pretax deductions or deferrals, such as earnings an employee contributes to retirement. For public employees not subject to Medicare taxes, the state instructs employers to come up with an estimate.

The State Controller’s Office updates its compensation database daily, generally with only minor changes. CIR used records published July 17. When contacted by CIR, some cities and counties said they reported incorrect data to the state and provided updated data to CIR. Payday California includes these corrections.

CIR did not include health and retirement benefits in its analysis because they were reported inconsistently in the state’s database. Until 2011, the state required only limited reporting of retirement contributions.

The City of Los Angeles, for example, reported no pension contributions in calendar years 2011 and 2012. Other city records, however, show that it contributed nearly $1 billion in each of those fiscal years to pension plans for more than 85,000 retired and current employees. The city also did not report actual contributions to each employee’s health benefits; instead, it reported the average amounts it contributed.

Read more about CIR’s analysis in our story.

Want more in-depth investigations? Sign up for our newsletters to get stories like this delivered straight to your inbox.

Making sense of public employee compensation is no easy task. California’s 58 counties and 482 incorporated cities have diverse populations, different costs of living and between 121 and nearly 10 million residents. The Center for Investigative Reporting sought to provide context to understand and compare city and county employee compensation, which generally accounts for more than a third of local government spending.

CIR analyzed data from the California State Controller’s Office, which collects compensation records for nearly all city and county employees in the state. Its database spans from 2009 to 2012 and annually includes as many as 700,000 full- and part-time municipal and county employees and all elected officials. It does not include independent contractors.

CIR used the state’s database to examine how local governments compensate their top officials. We identified the records for city managers, mayors, city council members, police chiefs and city fire chiefs, as well as county administrators, district attorneys, county supervisors and sheriffs.

Employees’ positions sometimes were presented in a straightforward manner, such as “accountant” or “fire chief,” but at other times were obscured by abbreviations, spelling errors or vague classifications, such as “Dept. Head V.”

Stay Up to Date

Sign up for our email newsletters and you'll never miss out on the stories that matter to you.

The state’s database does not include employees’ names. In some cases, we identified top officials by matching their reported compensation to separate compensation records that included employees’ names. We identified others by contacting cities and counties directly. In some communities, not all positions were reported or could be identified.

Payday chart - Bell
Payday chart - SF

CIR contacted cities, counties and organizations that represent or recruit local government leaders to identify factors that influence pay. Many said they considered the pay of similar positions in neighboring or similar communities, as well as cost of living, staff sizes and budgets.

We conducted a statistical analysis to determine what demographic factors are linked to top officials’ pay. Our analysis found that the two factors that most strongly correlated with compensation were population size and median rent.

The compensation data we used was the most uniform metric available in the state’s database: total wages subject to Medicare taxes.

Those wages are the total of regular pay (typically wages or salary); overtime pay; one-time payouts of unused vacation and sick time; and other taxable pay, such as car allowances and bonuses. Wages subject to Medicare taxes tend to be lower than gross wages because they do not include pretax deductions or deferrals, such as earnings an employee contributes to retirement. For public employees not subject to Medicare taxes, the state instructs employers to come up with an estimate.

The State Controller’s Office updates its compensation database daily, generally with only minor changes. CIR used records published July 17. When contacted by CIR, some cities and counties said they reported incorrect data to the state and provided updated data to CIR. Payday California includes these corrections.

CIR did not include health and retirement benefits in its analysis because they were reported inconsistently in the state’s database. Until 2011, the state required only limited reporting of retirement contributions.

The City of Los Angeles, for example, reported no pension contributions in calendar years 2011 and 2012. Other city records, however, show that it contributed nearly $1 billion in each of those fiscal years to pension plans for more than 85,000 retired and current employees. The city also did not report actual contributions to each employee’s health benefits; instead, it reported the average amounts it contributed.

Read more about CIR’s analysis in our story.

Want more in-depth investigations? Sign up for our newsletters to get stories like this delivered straight to your inbox.