Bonuses flow at LCRA, especially at the top

By any measure, Phil Wilson’s bosses at the Lower Colorado River Authority think he’s doing an excellent job.

In performance evaluations, board members say the utility’s general manager, who oversees water and power for more than a million Texans, has steered the river authority through turbulence to clearer skies, renegotiating contracts with key electricity customers, shepherding a reservoir project to construction and straightening out the utility’s finances.

And to show their appreciation, they have awarded him a $112,500 bonus this year, on top of his $495,000 salary.

In total, LCRA’s 10 senior executives – all white men, overseen by a 15-member all-white board – earned about $440,000 in bonuses in 2015, up from about $155,000 in 2014, according to bonus and pay information obtained by the American-Statesman through open records requests.

The executive bonuses exceed most salary boosts at other state-created agencies – the Statesman reported in October that about 78,000 state workers in recent years have received more than $270 million in bonuses – and appear to be at the upper end of the pay scale for executives at utilities in Central Texas.

LCRA officials say the bonuses and hikes in base pay, which have also been granted to rank-and-file employees, reflect the agency’s turnaround. All told, the bonuses amounted to $4.2 million.

When Wilson, a member of former Gov. Rick Perry’s circle and onetime official at Texas electric generator Luminant, was hired in 2014, the river authority was battling a revolt of its electric customers, some of whom ended their contracts rather than pay above-market wholesale power rates.

“The viability of LCRA was in question,” said LCRA spokesman Bill Lauderback, who said Wilson went about refinancing debt and reducing wholesale rates.

“We’re highly competitive in the marketplace and now seeking new customers,” Lauderback said. “It’s a turnaround story, and Phil deserves credit for it.”

As for the diversity issue, Lauderback said: “We’re all cognizant of it. Phil was looking for people that he knew personally, people he knew that had the professional capabilities to address serious problems. Having said that, do we need diversity on our executive team? Most definitely, and we hope to achieve that.”

Of the 34 managers below the senior ones that directly report to Wilson, 15 are women, one of whom is African-American.

The LCRA is a strange animal — a water- and electricity-producing utility created by the state, one that relies on its rates and fees to cover its operating expenses and gets no state appropriations — making payroll comparisons difficult.

Even as executive salaries at LCRA appear in line with industry norms, bonuses were on the high end compared to other Central Texas utilities that are serving fast-growing areas. The top bonuses last year at Pedernales Electric Cooperative, a retail electric utility that is LCRA’s largest wholesale customer, for example, were each under $20,000. Bluebonnet Electric Cooperative, another LCRA customer, has had at least three executives earn bonuses greater than $40,000 — including the general manager — and another three earning more than $20,000.

The escalation of the bonuses at LCRA recalls controversy at Wilson’s last job, as head of the Texas Department of Transportation. In 2012 the Statesman found that after Wilson took over, the average salary of TxDOT’s 10 highest-paid workers jumped 21.4 percent above that average a year earlier; the top three salaries were 42.5 percent higher.

Continuing work by his predecessor, Becky Motal, Wilson has trimmed the utility’s staff: Since he took over, just over 80 people have left, largely through involuntary layoffs, saving the company $5.4 million annually, according to LCRA. He has been something of a rainmaker to those who have remained: Companywide, the $4.2 million in bonuses was divvied up among 1,186 employees in 2015, or an average of $3,500 per employee. The amount was up from $3.3 million across 1,178 employees in 2014.

Wilson’s base salary also rose from $450,000 in 2014 to $495,000 in 2015. And he got a car allowance of $750 a month. His executive staff saw similar raises in pay: The pay of Wilson’s assistant, Clint Harp, went from $110,000 to $127,400; auditor Charlie Johnson’s pay went from $189,262 to $225,000. The chief financial officer’s salary increased from $280,000 to $303,680.

To decide Wilson’s bonus, the board reviews comparable market data. The river authority says it does not use predetermined criteria but provides discretionary awards to all employees based upon individual performance.

Wilson, who makes pay decisions for his executive staff, determined they “consistently rated as achieving outstanding results” in an evaluation.

But Wilson himself has won highest praise. In an Aug. 19 memo, board members, who are appointed by the governor, said they had a “very high regard” for his “results-oriented leadership style.”

“Hallmarks of his leadership are his personal integrity, innovative problem solving acumen and ability to manage multiple high priority projects,” said the memo.

LCRA board chair Tim Timmerman said that Wilson has “done an outstanding job getting our financial house in order.” The only thing Wilson can’t take credit for, he said, is filling up the lakes.

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