Home MTA Absurdity Perhaps now isn’t the best time for a raise

Perhaps now isn’t the best time for a raise

by Benjamin Kabak

While the MTA is crying poverty and threatening fare hikes and service cutbacks, the Authority is also doling out raises to its executives. According to a report in the Daily News, MTA Chairman Dale Hemmerdinger has authorized what Pete Donohue termed “a $10,000 boost” to CEO Elliot “Lee” Sander’s compensation package.

Hemmerdinger attempting to defend the move, noting that Sander’s $340,000 annual salary is low. “I approved a 3% increase for the executive director/CEO, equal to increases earned by the management that reports to him. Lee is still paid less than the heads of smaller transit agencies in Washington and Los Angeles, and far less than what he would earn in the private sector,” he said in a statement.

The reality of the situation is that $10,000 isn’t going to make or break an agency looking at annual deficits of hundreds of millions of dollars, and Sander has done an excellent job looking to the MTA’s future while negotiating the tough financial constraints of the present. But at a time when the authority is practically begging for a money, a high-profile raise no matter how small isn’t the right message to send to the fare-paying public or the legislatures holding the purse strings.

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Todd June 17, 2008 - 2:03 pm

I just threw up a little in my mouth as I read this.

brooklyn gal June 17, 2008 - 3:12 pm


Marc Shepherd June 17, 2008 - 3:18 pm

The truth is, he’s underpaid. But the timing doesn’t seem very wise.

Todd June 17, 2008 - 4:18 pm

We’re all underpaid Marc, but we’re also in a recession. This isn’t the time for salary increases, especially with a 3 billion dollar budget gap.

Alon Levy June 17, 2008 - 5:03 pm

We’re also in a state of inflation; a 3% increase in salary is fairly close to the level of inflation plus real growth.

When there’s a 3 billion budget gap, even a raise of 1 million is perfectly justified if there’s any chance it’ll produce people who can handle the finances better. A raise of 10,000 amounts to 3.3 millionths of the gap, hardly something that’ll break the MTA’s back.

Todd June 17, 2008 - 6:10 pm

if there’s any chance it’ll produce people who can handle the finances better

That’s just silly. You really think he’s going to work any harder/better because he got the extra 10 grand? Seriously, let’s just wait and see what kind of miracles he produces now that he has his raise.

Alon Levy June 17, 2008 - 10:53 pm

I’m pretty sure the chance of that is more than 1 in 3.3 millionths.

Marc Shepherd June 18, 2008 - 8:32 am

We’re all underpaid Marc, but we’re also in a recession.

I’m not so sure we’re “all” underpaid. If we cannot readily obtain employment that pays more, then we’re probably fairly paid. That doesn’t mean you’re happy about it, but our value is determined by the market, not by our dreams and aspirations.

Again, I would reiterate that the timing was poor, especially given that the size of the raise, in relation to his salary, was essentially symbolic.

Alon Levy June 18, 2008 - 8:36 am

I’m pretty sure the chance of that is more than 1 in 3.3 millionths.

And of course I meant 1 in 300,000.

ScottE June 18, 2008 - 8:37 am

Todd, I don’t think the money is meant as motivation to get him to work harder, or as a reward for going above and beyond expectations — it’s a motivation to keep him from jumping-ship and going back to the lucrative private sector.

What surprised me is that Hemmerdinger (Chairman) apparantly outranks Sander (CEO) and is authorized to set his compensation. Unless I’m mistaken, the CEO position was created for Sander to essentially take power away from then-chairman Peter Kalikow – implying that the CEO (Sander) outranks the chairman (Kalikow/Hemmerdinger).

Just don’t tell me that Sander also sets Hemmerdinger’s salary. If that were true (as I’d always assumed), then we’d have a story on our hands!

Both positions were appointed by former Gov. Spitzer, by the way.

R2 June 18, 2008 - 10:43 am

It’s the MTA. Somebody has to approve his compensation.

Sander is the Executive Director and CEO.
Hemmerdinger is the Chairman of the MTA Board. (I think he’s uncompensated)

Second Ave. Sagas | A New York City Subway Blog » Blog Archive » DN: MTA raise shows an agency out of touch June 18, 2008 - 12:48 pm

[…] Elliot Sander’s recent $10,000 package raise was largely symbolic, the timing, as I argued yesterday, could hardly have been worse. Today, the […]


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