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1350 Pennsylvania Avenue, N.W., Washington, DC 20004 To: From: Members of the Council of the District of Columbia Mary M. Cheh, Chairperson Committee on Government Operations and the Environment March 10, 2011 Preliminary Findings of the Committee’s review of the Executive’s Personnel Practices
Introduction In recent weeks, the personnel practices in the District Government have come under significant scrutiny, particularly with respect to the appointment of employees in the Excepted and Executive Services. The major concerns can be grouped into three categories: (1) compensation, (2) qualifications, and (3) nepotism. The Committee on Government Operations and the Environment has oversight responsibility for three agencies that play a role with respect to those concerns: (1) the Executive Office of the Mayor (“EOM”); (2) the Office of City Administrator (“OCA”); and (3) the Department of Human Resources (“DCHR”). Accordingly, the Committee has conducted a preliminary review of the personnel practices of the Executive, as well as the statutory and regulatory authority for these practices. This memorandum summarizes the information arising from this preliminary review. Compensation Practices The Home Rule Act vests the Mayor with the power to “administer the personnel functions of the District,” subject to a “merit system” established by the Council. 1 In 1978, the Council enacted the District of Columbia Government Comprehensive Merit Personnel Act (“CMPA”), which is modeled on the federal civil-service system. 2 One of the main purposes of the CMPA is to “assure that the District of Columbia government shall have a modern flexible system of public personnel administration.” 3
Section 422(3) of the Home Rule Act (D.C. Official Code § 1-204.22(3)). D.C. Official Code § 1-601.01 et seq. 3 Id. at § 1-601.02(a).
Although the Mayor is the ultimate personnel authority for the majority of employees in the District government, 4 DCHR is responsible for superintending the personnel duties for the District. Like the federal civil service system, the District has created various employee classifications, with specific rules applicable to that classification. Within each classification, the agency must create position descriptions, which are grouped into “grades” (in essence, salary ranges) that are “based on the consideration of applicable factors, such as knowledge and skills required by the positions; supervisory controls exercised over the work; guidelines used; complexity of the work; scope and effect of the work; personal contacts; purpose of contacts; physical demands of the positions; and work environment.” 5 Currently, DCHR is conducting a multiyear “Classification and Compensation Reform Project,” scheduled to be completed in FY 2012, which aims to modernize the existing system. For Excepted and Executive Service employees, the determination whether an individual appointee’s salary falls within a grade depends on a number of factors. According to the District Personnel Manual, an agency “may set the initial rate of pay at any amount up to the midpoint range of the grade or pay level for the position” based on a number of factors, including: (1) the appointee’s current salary; (2) the appointee’s skills beyond the minimum qualifications; (3) the “effect on agency and budget limitations”; (4) the “Market value” of the position; and (5) consideration of any “Internal compensation relationships.” 6 In “extraordinary cases,” the agency can “request approval from the personnel authority” to pay a salary above the midpoint. 7 Excepted Service Unlike most Career Service employees, Excepted Service employees may be hired noncompetitively based on qualifications “developed and issued by the appropriate personnel authority.” 8 The Mayor may appoint a limited number of individuals to the Excepted Service. 9 These employees are employed at will and enjoy very limited job protection, tenure, or appeal rights. 10 Compensation schedules for Excepted Service employees are proposed by the Mayor and submitted to the Council for review and approval. 11 The Mayor has the discretion to pay Excepted Service employees within the salary ranges set forth in the compensation schedule in Figure 1, but may not exceed the maximum salary of $193,125.
Id. at § 1-604.06(a), (b). Id. at § 1-611.01(b). 6 District Personnel Manual (“DPM”) § 1126.7(a). 7 Id. at § 1126.7(b) 8 D.C. Official Code § 1-609.01. 9 Id. at § 1-609.03 (a)(2). 10 Id. at § 1-609.05. However, they are entitled to severance pay upon separation. § 1-609.03(f). 11 Id. at §§ 1-611.04 - .06.
Grade ES1 ES2 ES3 ES4 ES5 ES6 ES7 ES8 ES9 ES10 ES11
Minimum Midpoint Maximum $29,870 $37,338 $44,805 $36,050 $45,063 $54,075 $41,200 $51,500 $61,800 $46,350 $57,938 $69,525 $51,500 $64,375 $77,250 $58,710 $73,388 $88,065 $72,100 $90,125 $108,150 $82,400 $103,000 $123,600 $92,700 $115,875 $139,050 $103,000 $128,750 $154,500 $128,750 $160,938 $193,125
Figure 1-Compensation Schedule for Excepted Service
The Committee is aware of two individuals in the Excepted Service whose salaries exceed the Council-approved cap. 12 Executive Service Subordinate agency heads are classified as Executive Service employees. 13 Like members of the Excepted Service, employees in the Executive Service “serve at the pleasure of the Mayor.” 14 Also like the Excepted Service, the compensation schedule for Executive Service employees is subject to Council review. In 2007, the Council approved emergency and temporary legislation 15 intended to create two additional pay levels and to allow incumbents to receive salaries greater than the maximum. 16 The legislation has lapsed, however, and the operative compensation schedule for non-incumbents reverted to that approved in 2006 set forth in Figure 2, 17 with a maximum salary of $179,096. 18
The two employees are Warren Graves (Chief of Staff, Office of City Administrator) and Gerri Mason Hall (Chief of Staff, Executive Office of the Mayor). 13 D.C. Official Code § 1-610.51(b). 14 Id. 15 See D.C. Act 17-83, “Executive Service Compensation System Change and Pay Schedule Emergency Amendment Act of 2007”; D.C. Law 17-56, “Executive Service Compensation System Change and Pay Schedule Temporary Amendment Act of 2007”; D.C. Act 17-55, “Executive Service Compensation System Change and Pay Schedule Congressional Review Emergency Amendment Act of 2007”; D.C. Act 17-424, “Director of the Office of Public Education Facilities Modernization Allen Lew Compensation System Change and Pay Schedule Emergency Amendment Act”; and D.C. Law 17-238, “Director of the Office of Public Education Facilities Modernization Allen Lew Compensation System Change and Pay Schedule Temporary Amendment Act of 2008.” 16 This included the Chancellor of the District of Columbia Public Schools, Chief Financial Officer, the Chief Medical Examiner, the Chief of Police, the Chief of the Fire and Emergency Medical Services Department, and the Director of the Office of Public Education Facilities Modernization. 17 The Council last approved an Executive Service compensation schedule in July 2006 pursuant to Resolution 16-704, the “Executive Service Compensation System Changes Approval Resolution of 2006.” 18 The maximum compensation in the Executive Service is actually lower than the Excepted Service.
Grade E1 E2 E3 E4 E5
Minimum Midpoint Maximum $85,284 $106,605 $127,926 $92,746 $115,901 $139,056 $100,848 $125,964 $151,081 $109,590 $136,859 $164,129 $118,651 $148,874 $179,096
Figure 2-Compensation Schedule for Executive Service
There are currently five Executive Service appointments 19 and one interim appointment 20 whose salaries exceed the cap approved by the Council. The Executive may be considering additional appointments with salaries that are greater than the salary cap. With respect to the salary of Allen Lew, the City Administrator, the Home Rule Act provides that “[t]he City Administrator shall be paid at a rate established by the Mayor” and is not subject to Council review. 21 Without Council approval, an employee’s base salary may not exceed the approved cap. 22 In the past, the Council has affirmatively approved increased compensation for specific individuals. 23 The Committee has been advised that the Mayor all along intended to submit legislation that would authorize the beyond-the-range compensation for all relevant appointments once all of the major positions are filled. This is because there may be other instances where the Mayor concludes that, under the circumstances, an appointee should be paid beyond the cap. The Committee appreciates that the Mayor needs flexibility in compensation for certain nominees, especially where a special skill set is required, the pool is thin, or the best candidate is earning compensation beyond what the District could offer within the cap. In addition, because the District, unlike some other jurisdictions, generally does not provide other benefits (such as housing allowances or defined-benefit pensions), competitive salaries may be even more important to attract highly qualified candidates for positions.
The six appointees are Mohammad Ahkter (Director, Department of Health), Judy Banks, Kenneth Ellerbe (Chief, Fire and Emergency Medical Services Department), Kaya Henderson (Acting Chancellor, District of Columbia Public Schools), Irvin Nathan (Attorney General), Wayne Turnage (Director, Department of Health Care Finance). The salaries of the Chief of Metropolitan Police Department, Cathy Lanier, and Marie-Lydie Pierre-Louis, the Chief Medical Examiner have already received Council approval under the previous administration. 20 Judy Banks is the Interim Director of the Department of Human Resources. Her appointment is expected to end by March 31, 2011. 21 D.C. Official Code § 1-204.22(7). The Deputy Mayors, who earn salaries in excess of $180,000, are apparently hired as Excepted Service employees. 22 There is consensus on this point. The Executive, however, apparently interprets this provision as applying on an annual basis, rather than on a biweekly basis. Stated another way, as long as the total base salary paid in a fiscal year does not exceed the cap, an employee may be paid at a rate higher than the equivalent biweekly rate for a corresponding base salary. 23 In addition, the Council has authorized changes in compensation based within a grade level. In 2005, for instance, the Council reduced the compensation for the People’s Counsel from the maximum rate within a grade of the Senior Executive Attorney Service to the midpoint rate. In 2008, the Council unanimously restored the compensation for the position to the maximum rate of the grade. See D.C. Law 17-210, the “Compensation and Holdover Clarification Amendment Act of 2008.”
Nevertheless, the Mayor must seek Council approval before paying employees salaries beyond the Council-approved schedule. Qualifications As discussed above, the CMPA permits the Mayor to appoint persons to the Excepted and Executive Services through a non-competitive process. The law does require, however, employees to be qualified for the position to which they have been hired. 24 The Committee is aware of a specific allegation of an unqualified individual appointed to an Excepted Service position. That individual is no longer employed by the District government, and the circumstances of his hiring are the subject of official investigation. When asked about the role of DCHR in reviewing individual employees’ qualifications for Excepted Service positions, the Committee was advised that because “the positions are ‘at-will’ and serve at the pleasure of the appointing authority, flexibility in hiring is exercised by DCHR to accommodate a variety of agency operational and programmatic needs.” The Committee interprets this to mean that the appointing authority is given nearly complete discretion in hiring Excepted Service employees. Another recent concern relates to the appointment of an individual who may have failed to disclose a prior criminal record on her District application. Specifically, there have been reports that the individual had been previously convicted of felonies, but did not disclose the matter. Although failure to disclose this sort of information may lead to adverse employment actions, there is no obligation for the personnel authority to do so. Moreover, the Mayor has implemented a new requirement that all Excepted Service employees under criminal background checks before initial appointment. Nepotism One of the other major concerns raised recently involves the appointment of family members of top officials to positions within the District government. As with compensation beyond the salary cap, the circumstance of intra-familial hiring has occurred in previous administrations. 25 The District’s practices are governed by both local and federal nepotism laws, 26 which prohibit a public official from “appoint[ing], employ[ing], promot[ing], advanc[ing], or advocate[ing] for appointment, employment, promotion, or advancement, in or to a [position] in the agency in which he is serving or over which he exercises jurisdiction or control any individual who is a relative of the
D.C. Official Code § 1-609.01. See, e.g., David A Nakamura, Fenty Administration Is a Family Affair, Wash. Post, D.C. Wire (March 4, 2009), available online at http://voices.washingtonpost.com/dc/2009/03/fenty_administration_is_a_fami.html (describing the hiring of an attorney who was the spouse of a deputy mayor and stating that “[t]he hiring of relatives to high-level jobs is not unique to the Fenty administration. For example, former Mayor Anthony A. Williams (D) appointed Robert Newman as director of the parks and recreation agency and hired his wife, Sherryl Hobbs Newman, to run the city's customer service division, including the call center. Some former Williams aides said this week that D.C. is a small town with a limited universe of qualified people, so hiring relatives of employees is almost unavoidable.”). 26 5 U.S.C. § 3110; D.C. Official Code § 1-601.08.
public official.” 27 At this point, the Committee is aware of two individuals who have been appointed in the District and who are relatives of senior District officials. 28 Both individuals, however, have subsequently resigned. The Committee is not aware of any specific allegations that either official had exercised any influence during the hiring process, or even that the statute would apply to them in their respective capacities. Additional comments The Committee has analyzed District government salary data and has found that the median and mean salaries of employees in the EOM and the OCA have increased by more than 10% from September 2010 to March 2011. Moreover, the overall number of employees in those offices has increased. Expenditures for those offices have also increased. Yet, it is difficult to conclude from this data that the actual cost for these two offices has increased because of the practice of “detailing” and “embedding” employees. For example, under the previous administration, the Office of the Secretary employed a full-time equivalent on staff that essentially reported to the Mayor’s office. Similarly, in the previous administration, the City Administrator employed staff that reported directly to staff in the Mayor’s Office. Thus, it may be that more money is being spent on salaries for persons in the EOM and OCA, or it may be that there is more transparency in identifying those persons actually working for the EOM or OCA. Recommendations 1. The Mayor should promptly reduce or seek Council authorization of salaries for appointments in excess of the Council-approved cap for Executive and Excepted Service employees. 2. The Mayor and City Administrator should specifically inform all personnel of the nepotism rules and seek the resignation of any employees who have been appointed as a result of the violation of such rules. 3. The Mayor and City Administrator should examine their internal pre-employment screening practices with respect to personnel hired in the Excepted Service. 4. As a longer-term project, the Council and the Mayor should revisit the Executive Service compensation schedule to determine whether the salary ranges are fair, reasonable, and competitive.
5 U.S.C. § 3110(b). The son of Gerri Mason Hall, Chief of Staff, Executive Office of the Mayor, was appointed to a position in the Department of Parks and Recreation, and the son of Dr. Linda Wharton-Boyd, Director of Communications, Executive Office of the Mayor, was appointed to a position in the Office on Volunteerism. Both have resigned.
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