The U.S. Department of Housing and Urban Development (HUD) is proposing the implementation of compensation caps on executives in the nation's public housing authorities (PHAs).
The proposal follows a HUD-sponsored compensation survey that determined instances of ‘excessive’ compensation. As a result, HUD has proposed PHA executive compensation that is commensurate with the size and number of units in housing authorities, ranging from a minimum of nearly $75,000 to a maximum of $155,500.
‘These caps would be indexed to federal government salary scales, taking effect in fiscal year 2013 and remaining in place indefinitely,’ HUD says in its proposal. ‘Unlike the current cap in place for fiscal year 2012, these caps are limits on total cash compensation, not just salary. We have found that at the highest paying PHAs, many executives receive a significant share of their compensation through bonuses. So the current cap essentially leaves a loophole that could be used to continue to provide excessive pay through bonuses. These changes will close that loophole.’
HUD adds that while the PHAs are state-run entities, they receive ‘significant federal resources and, as such, must adhere to federal standards of fiscal responsibility.’ The department has also challenged Congress to approve the proposal.
‘We want to work with Congress to put in place this permanent solution, but we will not wait if Congress fails to act,’ HUD says. ‘We are announcing that we will take executive action to put this cap in place in fiscal year 2013 under our own regulations, if necessary.’