House panel moves to rein in commissioner severance pay

Payouts to departing state workers who make top salaries could be trimmed under a provision put forward by a critic of the governor’s past actions regarding severance packages.

Sponsored by Rep. Sarah Anderson (R-Plymouth), HF399 would add provisions to current law that could lower the maximum amount of severance pay.

Rep. Sarah Anderson

The House Government Operations and Elections Policy Committee approved the bill Wednesday and sent it to the House State Government Finance Committee, which Anderson chairs. There is no Senate companion.

At issue are payouts to highly compensated state employees who leave their posts. Anderson said her bill “tightens the language” of current law, which does not expressly authorize severance payments.

As defined by statute, a “highly compensated employee” is a state worker earning annual compensation greater than 60 percent of the governor’s $127,629 salary. Sixty percent is $76,577.

The “highly compensated” category includes non-union state workers such as engineers, administrators of higher-level state programs, and people in information technology and health care positions, Anderson said.

Current law caps severance pay at an amount equal to six months of the employee’s salary. HF399 would set maximum severance compensation at the same six-months-of-salary figure, or an amount equal to 35 percent of the unused sick time an employee has banked, whichever is less.

Sparking the bill was Gov. Mark Dayton’s approval of three month’s severance pay for three former members of his cabinet.

• Sheila Wright got $18,064 after leaving as director of Higher Education Services Office after eight months on the job in 2011;
• Mark Phillips received $27,097 after stepping down in October 2012 as head of the Department of Employment and Economic Development after 20 months of service; and
• Katie Clark Sieben, who replaced Phillips, got $33,750 after she left the same DEED post in April 2016.

The severance payments came to light in a Sept. 20, 2016, report by American Public Media that noted eight other departing commissioners had not received similar payouts.

Republican reaction to the report was swift and strong.

LISTEN Full audio of Wednesday's House Government Operations and Elections Policy Committee hearing

In a statement at that time, House Speaker Kurt Daudt (R-Crown) said Dayton had “disrespected taxpayers and used their money to inappropriately reward his top officials who are already making six-figure salaries.”

Commissioner pay has been a bone of contention between Dayton and legislators in recent years. In 2015, the Legislature resolved a spat over the governor’s plan to raise commissioner salaries by passing a law that left him with one day to institute the pay hikes that he sought but many legislators opposed.