For Cary Tennis Park manager, checks come with a bonus

dkane@newsobserver.com akenney@newsobserver.com sharrison@charlotteobserver.com November 20, 2013 

Tennis Park Supervisor Sean Ferreira oversees tennis practice at the Cary Tennis Park on Aug. 14. Ferreira has been with the town of Cary since 2005.

AL DRAGO — adrago@newsobserver.com Buy Photo

  • By the numbers

    $131,377 Salary plus bonus of Sean Ferreira, supervisor, Cary Tennis Park

    $138,777 Salary of Raymond Cain, Cary fire chief (no bonus)

    $124,162 Salary of Lewis Ledford, N.C. State Parks director (no bonus)

  • More information

Since 2005, Sean Ferreira has managed Cary’s 29-court tennis center for a salary that has now reached nearly $60,000, about the same as a veteran firefighter. He doesn’t risk his life in fires, but he does manage a staff of nine tennis teachers and administrators and a $1.8million budget at one of the country’s top public tennis facilities.

Unlike almost all of Cary’s 1,200 employees, however, Ferreira has an arrangement with the town that usually pays him more in bonuses than salary; in the last fiscal year, that bonus topped $71,000. His total pay of $131,377 nearly rivaled that of the town’s fire chief, and it’s $22,000 more than the Parks and Recreation director.

The bonuses represent an incentive arrangement that pays Ferreira more if the Cary Tennis Park brings in more revenue. Under his watch, the 13-year-old center’s revenues have improved, but it still operates in the red, with an annual deficit hovering around $275,000 during a recent five-year period.

Ferreira is among roughly 40 state and local employees in the state pension system who received bonuses of $20,000 or more in 2011, the most recent year available statewide, according to The News & Observer’s analysis of pay data for more than 435,000 public employees.

For many state employees, teachers and the vast majority of city and county workers, the last few years have been tough times, with small salary increases and spotty bonuses. Cary has fared better, maintaining annual raises of 2.5percent or 3percent since the start of the recession.

A review of state pension records from 2008 to 2011 shows that one of every five state and local employees received a bonus. A little less than half the 1,216 agencies in the system paid a bonus to at least one employee during that time, but many of them are small.

School districts are more likely to hand out bonuses to many of their employees than most other government agencies. Some municipalities, including Charlotte, the state’s biggest city, have handed out bonuses to most of their employees; in Charlotte’s case, the bonus was 1percent and came instead of a pay raise.

These bonuses can have an additional effect: They count toward calculating an employee’s pension if they are awarded during the employee’s four highest consecutive years of compensation.

Yet they don’t show up in many public salary records or databases. The News & Observer found them by requesting pay data from the state Treasurer’s Office that most state and local agencies provide for pension purposes.

Other notable bonuses:

•  $53,000 to Graham Edwards, chief executive officer of ElectriCities, a government-created nonprofit that buys and sells power for dozens of municipal utilities. The bonus, 10percent of his base salary of $530,000, is just for staying with the organization.

•  $91,514 to Josef Penner, head of Mecklenburg County’s emergency transport service, MEDIC. That bonus was in 2010; since then, his bonus has dipped below $70,000.

That kind of bonus money puts those employees among an elite crowd of mostly athletics coaches and directors whose contracts typically offer bonuses far larger for successful seasons. In 2011, for example, N.C. State University football coach Tom O’Brien got $150,000. O’Brien subsequently was fired.

In many cases, the bonuses are intended to reward success. But unlike the coaches, the big bonuses Ferreira and other public employees received aren’t well known. That’s because they aren’t in such high-profile jobs, and their compensation typically is not discussed in detail in open sessions of public meetings.

Eric DeSimone, a police sergeant who leads the Raleigh Police Protective Association, a union representing the city’s officers, said it’s tough to hear about big salaries and bonuses for some employees while he and many other rank-and-file employees have seen no bonuses and one or two small pay increases over the past five years.

“These guys are going up 40, 50 thousand dollars. Many police officers or firefighters, they are just wishing that they could go up five or 10 thousand dollars in four or five years,” DeSimone said. “That would be a dream come true for them and their families.”

Attracted to Cary

The potential for bonuses was key in bringing Ferreira to Cary’s tennis complex, which was struggling in 2005 after a management company bailed out. Ferreira, 42, had played in his collegiate years from 1989 to 1993 at N.C. State University, where he was a two-time All-ACC player.

Before coming to Cary, he managed a public facility in Peachtree City, Ga., under a revenue-sharing model similar to Cary’s.

By offering the potentially big incentives, Ferreira said, the town’s “exposure to risk is minimal. You’re not committing this huge salary to someone. You’re committing kind of a smaller salary to someone.”

He compared the deal to a sales commission. Revenue sharing, he said, “is very common in the tennis industry, but in government that’s a unique thing.”

In recent years, the only Cary employees to receive bonuses have worked at the tennis center, according to staff and records.

Cary records show that during Ferreira’s tenure, revenues at the tennis center have nearly tripled to more than $1.3million in fiscal 2012, the last year for which budget numbers were available. Usage has nearly doubled.

“It is not unusual to have a superstar sales person in a company, particularly a small business,” Cary Councilman Jack Smith said. “If they deliver the results, then they’re going to get some pretty aggressive compensation.”

But big bonuses for public employees draw criticism, too. Thom Reilly, director of the School of Social Work at San Diego State University, is the author of “Rethinking Public Sector Compensation.” A former chief executive of Clark County, Nev., with a doctorate in public administration, he has researched new models of government compensation.

In many cases, he said, employees’ bonuses come on top of consistent pay increases and benefits such as health care that often are more generous than the private sector.

“Personally, I really like the idea of bonuses and revenue sharing, and some of these other models, but they should be in lieu of your current pay and benefits,” he said.

He also suggested that governments should tie bonuses to customer satisfaction and expenses.

William Davis, Cary’s athletics manager and Ferreira’s direct supervisor, said customers are happy with the center but acknowledged its expenses have grown alongside its revenues, which means the longstanding deficit has yet to be erased, though it’s a significantly smaller portion of the budget. The park draws young high-level players from hours away, and a teen protege of the park staff won a national title this year.

The incentive model doesn’t penalize tennis park employees for expenses. “It really isn’t built into the formula,” Davis said, adding that the town still examines Ferreira’s performance with regard to expenses.

Few outside of town government knew about Ferreira’s bonuses. Town minutes don’t reflect the incentive arrangement, and even a former council member couldn’t recall it.

“None of that rings a bell with me at all. I don’t recall ever getting that level of detail,” said former Councilwoman Julie Robison, who served on the board from 2001 to 2012. She did not criticize the arrangement.

Ferreira’s incentive deal is relatively unusual among municipalities that offer sizable tennis facilities, but at least one other North Carolina community has a similar arrangement. Junius Chatman, director of High Point’s Oak Hollow Tennis Center, has been receiving bonuses in the $30,000 to $35,000 range on top of his roughly $50,000 salary. Some of that bonus comes from lessons he teaches.

Raleigh’s tennis director, David Bell, does not have an incentive deal. He is paid an $83,711 salary and teaches two to four lessons a week, with payment for them rolled into the salary he’s paid for managing tennis courts in 25 locations.

Kenney: 919-460-2608 Twitter: @kenneyNC Kane: 919-829-4861; Twitter: @dankanenando

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