House budget would slash salary of economic development chief

March 11, 2010 | | Comments 15
Larry Hayes

Larry Hayes

By Beth Musgrave –

FRANKFORT — A little-noticed provision in the state House’s proposed budget would nearly cut in half the $250,000 salary of the state’s chief economic development officer.

The House on Wednesday passed a two-year, $17.5 billion budget that included a host of cost-saving provisions, including cutting the amount spent on service contracts by more than $100 million and saving $5 million by axing 120 political appointees over the next two years.

But deep in the budget is another provision that would cap the salary of Larry Hayes, the secretary of the Economic Development Cabinet. Hayes, who makes $250,000 a year according to the state’s transparency Web site, is the highest paid cabinet secretary.

The House budget says the Economic Development Secretary’s salary should not surpass the governor’s salary of $127,885.

Both Hayes and Beshear took 10 percent pay cuts this year.

Kerri Richardson, a spokeswoman for Beshear, said the administration has concerns that capping Hayes’ salary undermines the authority of the Kentucky Economic Development Partnership Board, which hires the secretary and oversees Hayes’ actions.

That arrangement is similar to other positions in state government, including the Commissioner of Education and the President of the Council on Postsecondary Education. The Commissioner of Education, Terry Holiday, makes $225,000. Robert King, the president of the CPE, makes $400,000.

“This provision is of concern to the extent that it diminishes the authority of the Economic Development Partnership Board and would inhibit recruiting in the future,” Richardson said.

Hayes also makes less than the previous economic development secretary, Richardson said.
Hayes declined to comment for this story.

With so many people out of work — nearly 82,000 last year — House leaders said agency heads shouldn’t be making salaries in the high six figures.

“In some of these quasi-governmental agencies, some of the salaries are getting out of hand,” said House budget chairman Rick Rand, D-Bedford.

Rand said he’s not sure the state needs to pay $250,000 to get a top-tier economic development chief. “If they don’t have to go any further than Louisville, Ky, then surely to God we can find somebody at the same salary as the governor,” Rand said.

Hayes had worked for Louisville Mayor Jerry Abramson before joining state government as secretary of Beshear’s cabinet.
Rand said House leaders have also sent strong messages to the boards of the state’s universities that salaries of university presidents need realigned.

Ironically, legislative leaders took heat from rank-and-file lawmakers and the public when it gave Legislative Research Commission Director Bobby Sherman a raise from $132,840 to $195,000 in 2008.

House Speaker Greg Stumbo, D-Prestonsburg, said he was not in leadership at the time that Sherman’s salary increase was approved.

When asked if the House would also cap Sherman’s salary, Stumbo said that “no agency head should make more than the governor.”

But Hayes is only one of 43 people in the executive branch of government, including four other cabinet secretaries, who make more money than Beshear.

Many of those people are doctors in the Department of Corrections or in public health. Others are commissioners or higher-level department secretaries.

Stumbo said he has no problem with doctors or others with specialized skills being paid salaries that are commensurate with their experience.

He and Rand both said they expect the Republican-led Senate to consider adding more salary caps in the budget.

Filed Under: Greg StumboKY General AssemblyLarry HayesRick RandState BudgetState GovernmentSteve Beshear

About the Author:

RSSComments (15)

Leave a Reply | Trackback URL

  1. yeah right says:

    You know the funny thing is that a lot of these salaries are crazy. Why would these state jobs pay these executives more than $ 200,000.00 per year? And one is $ 400,000.00, that is more than the President of the United States…..I dont think any of them should make more than the Govenor…they should all be capped.

  2. Bob Miller says:

    This is why our taxes are so high.
    Why are these guys paid so much money?
    And don’t tell me that’s what a person in the private sector would get doing the same job. All government employees have the
    best benefits our tax dollars can afford.
    It’s time for all government employees to
    take a cut just as the private sectors have
    been doing.

  3. snappy says:

    You guys are right. I’d take it a step further and make it that govt employees could not earn more than 2x the median national wage. Only those at the top could make the top rate (i.e., the Pres, governors, etc.)

    We need citizen legislators with term limits, not professional people who somehow turn into millionaires after a couple of terms. dump these bums.

  4. Brad says:

    Economic development is extremely important to changing this State, however, nothing gets secured outside the “triangle”. Larry Hayes doesn’t know how to secure economic development benefit to this State, nor does the rest of the Administration.
    Larry Hayes is not worth the salary. What has he accomplished since he joined Beshear? – nothing.
    Bring back Gene Straughn and watch how to attract new jobs.

  5. Nice guy says:

    Nice. Now, how about capping the pay of the grossly overpaid presidents of state colleges who claim to “develop” the state?

    Besides, isn’t it funny that none of them is so valuable that universities from other states want to “steal” them from us, the ingrates?

  6. handiman says:

    LHL, list the top 2000 salaries of all Executive Branch employees, where they work,title, and their length of state employment. List the top 500 of all the quasis.

    Then you’ll see public outrage.

  7. Karma Sucks says:

    Wahhh! Somehow I just don’t feel that bad for him. I think they should drop him down to about $30,000 so he can see how it feels to get screwed by the man for a change.

  8. jcon says:

    Remember that all State Employees get the greatest benefit package available anywhere. Guaranteed retirement. No government employee should make more than $50,000.00/year salary. This would equate to +- $165,000.00-$300,000.00/year total package with the benefits depending on their lifespan.

  9. svh123 says:

    handiman is on to a good idea, but let’s expand on that:

    List the top 100 salaries (for each) in

    1) The Branch Executive
    2) The Legislative Branch
    3) The Cabinets
    4) The quasi government agencies like KLC etc.
    5) The Judicial Branch

    These branches of our government represent a world of people living well that have not experienced the cuts private sector households have had to make during the last three years.

  10. unfair says:

    If this man is worth that much money, then what are we getting for the money as Kentucky is at the bottom of the barrel for almost everything except we are number three in the nation when it comes to corruption in politics. There are enough people in State Government and Federal Government making high salaries, that reducing them or cutting the fat might just balance the budget.

  11. Bill says:

    Don’t forget fat cats in UK:
    The president of a 4th rate college, University of Kentucky, makes 1st rate salary. UK has many overpaid faculty, administrators led by a overpaid president.
    “University of Kentucky President Lee Todd signed a new three-year contract yesterday that raised his salary by about 67 percent and allows him to earn as much as $461,000 this academic year.
    That would increase his pay by $185,670 above the $275,330 he earned in 2004-2005.
    The contract puts Todd’s salary within striking range of the bottom rung of the nation’s 20 highest-paid university presidents.”

  12. Bob says:

    Wait a minute. Let me see if I get this straight–David Williams requires the Executive Branch to spend a half-million dollars for his storm troopers to protect him when he’s gambling at out of state casinos. The LRC chief gets a pay raise of a gazillion percent while Kentuckians basic needs aren’t being met. David Williams has wide screen t.v.s and office renovations, and huge budget increases for the LRC.

    But they want to cut funding for economic development? Does this depress anybody else too? Veto the budget increases for LRC, and put the money towards things that will help Kentucky.

  13. D.M. NORRIS says:

    TIS TRUELY TRUE, “THE APPLE ROTS FROM THE CORE OUT”. Be this the case I would suggest that we do some serious pruning, cut some of the ‘Dead Wood’ lest we slip below Arkansas, AGAIN… In a better time the buzz word was ‘Thank God for Arkansas’. Of course that was when Arkansas was ranked 48th. in Education and Kentucky was a miserable 47th. but now Arkansas has swapped spots with us. GO BIG BLUE, RAH RAH RAH…….

  14. Hall Monitor says:

    Does Steve Beshear have any friends post 1980?

  15. Buck Feshear says:

    At $1 a year, Beshear is grossly overpaid.

    THe Kentucky Gazette in Frankfort used to publish a list of the top 1,000 salaries in state government. Wonder if they still do? And the Courier-Journal used to have a state government salary base online.