Charleston area leaders rail against industry-recruiter's salary

David Ginn, president and CEO of the Charleston Regional Development Alliance, talks about the job-recruiting agency in its new offices overlooking the Ashley River in North Charleston. Buy this photo

As the main industry-recruiting group in the Charleston region fractures, one of the chief concerns among county contributors has been the salary of its leader.

Economic development leaders' salaries

State Commerce Secretary Bobby Hitt $162,640

Charleston County's Steve Dykes $143,250

Berkeley County's Gene Butler $82,817

Dorchester County's Jon Baggett $89,587

Charleston Regional Development Alliance CEO David Ginn $225,000*

*With bonuses and other benefits, Ginn's salary is $293,500.

Sources: State of South Carolina, counties, CRDA

David Ginn, president and CEO of the Charleston Regional Development Alliance, earns a base salary of $225,000, but with bonuses and other benefits, his total compensation for 2013-14 climbed to $293,500, according to alliance spokeswoman Claire Gibbons. For the previous 12 months, he earned $286,690.

Last year, Ginn earned nearly as much as the current combined salaries of state Commerce Secretary Bobby Hitt and Charleston County Economic Development Director Steve Dykes. Hitt earns $162,640 a year. Dykes makes $143,250.

Other economic development leaders in the Charleston region take home less.

Berkeley County Economic Development Director Gene Butler earns $82,817, while his counterpart in Dorchester County, Jon Baggett, makes $89,587.

"How can you justify paying someone that amount of money for the number of employees there," Charleston County Council Chairman Teddie Pryor said of Ginn's total compensation.

The alliance has 12 employees. Pryor said County Administrator Kurt Taylor oversees more than 2,500 employees and earns $180,000.

Fracturing


Charleston County pulled out of the alliance earlier this week, taking its $500,000 annual contribution with it to form a new industry-recruiting organization, hopefully with Berkeley and Dorchester counties. Both of those counties have questioned their continuing financial commitments to the alliance, but they have not yet left the nearly 20-year-old organization.

"How can I justify us getting the biggest bang for our buck and spending a half million dollars?" Pryor said. "I can get a better product now. It's nothing personal. It's just business."

Alliance spokeswoman Claire Gibbons said Ginn's base salary is on the lower end of a compensation research study comparing 10 similar agencies across the country.

Based on the study conducted by Jorgenson Consulting, a national executive search firm serving organizations in nonprofit and community and economic development, Gibbons said the pay for heads of regional economic development organizations - with similarly structured, free-standing, public-private partnerships and budgets between $2 million and $5 million - ranged from $219,450 to $400,000. The average salary was $299,000. The Charleston alliance has a budget of $3.1 million.

"Consequently, David's (base) salary is at the lower end of the range for our peer organizations across the U.S.," she said.

The larger regional job-recruiting agencies in South Carolina are not set up like the Charleston alliance and do not offer an "apples-to-apples" salary comparison, Gibbons said.

The Upstate SC Alliance, which covers 10 counties around Greenville and Spartanburg, is a public-private partnership and operates with a $1.9 million budget. Its president and CEO, John Lummus, earns a base salary of $155,000.

The Central SC Alliance in nine Midlands counties around Columbia did not respond to a request for its annual budget and director's salary for comparative analysis.

Gibbons said if a new agency head were hired, he or she would probably have to be paid a higher salary in the competitive regional job-recruiting business.

"Our region is in direct competition with communities around the world for business and talent in a global economy defined by innovation, knowledge and technical expertise," Gibbons said. "Being a world-class economy means doing business at a different level. Continued success will depend on everyone working together, having the broad support of public-private partnerships and creating a unified vision for our region's economic future."

'Hard to defend'


Not only does Pryor think Ginn's pay was too high, officials in Dorchester and Berkeley raised eyebrows as well.

"For me to stand in front of taxpayers and try to justify a $293,000 salary package, it's difficult if not impossible to do," said Berkeley County Council Finance Chairman Tim Callanan.

Dorchester County Council Chairman Bill Hearn echoed Callanan's remarks.

"As a county council chairman, it's almost uncomfortable to talk about his compensation package," Hearn said. "As an elected official, it's hard to defend. It's not something we are ever able to offer anybody we have (in Dorchester County government). The three counties would say that salary is out of line. The private sector would say that's the salary it would take to stay competitive. That's the tension there."

Realignment?


As to the whether Dorchester will stay in the alliance and continue its $50,000 commitment, which was reduced from $173,000 the previous year, Hearn said the county will have to align itself with the group that will not endanger its industry-recruiting efforts.

"If the goal is to establish an ongoing relationship with (the state Department of ) Commerce, you don't want to be out of that loop," Hearn said. "We don't want to position ourselves where we would be at odds with Commerce. That would be fatal."

He also said Dorchester County would never want to be recruiting industry by itself.

Callanan also stressed that "it's an absolute necessity" for the region to have just one umbrella group to represent its collective economic development efforts, whether it's the alliance or another organization.

Berkeley hasn't officially said if it will leave the alliance, but it is withholding the $258,000 it set aside for the agency.

"That our entire contribution doesn't even cover one person's salary on an annual basis, I simply can't justify that to my constituents," Callanan said.

Gibbons said county leaders sit on the executive committee that approves alliance employees' compensation.

Accountability


"You have to look at it from a steward of taxpayer money perspective. With that comes making sure there's efficiency and there's accountability," Callanan said. "And in economic development, unlike other government services, you look at return on investment."

He said it's frustrating that the bulk of the mess stemmed from "bad communication and no accountability."

"I honestly think this is the root cause," Callanan said.

He said he reviewed meeting minutes and found that the last time the alliance made a presentation before Berkeley County Council was in 2008. Callanan said Ginn may have been in the audience for some other meetings since then.

"That causes all sorts of problems, particularly when you're investing close to $200,000 a year of taxpayer money," he said. "You have to have accountability about how you're spending that money on an annual basis at a minimum."

The alliance says it has helped to produce 27,500 new jobs and $7.5 billion in capital investment from 251 new or expanding companies since 1995.

Callanan questions whether the alliance can take credit for those figures.

"With regards to return on investment, who knows what the return on investment is?" he said.

Callanan said he thinks the alliance "inflates" its impact when it takes 100 percent credit for some job announcements that it had a limited role in recruiting.

"At that point you can't trust the numbers," he said.

He cited the larger deals as an example.

"These huge projects. The Department of Commerce ... keeps them close to the vest," Callanan said. "The (alliance's) involvement here is limited, a backup role. So you can't take 100 percent credit for landing that company because the Department of Commerce is working on it."

The lack of accurate data "further deteriorates the relationship. You can't trust the figures you're getting," he said.

Callanan then returned to the lack of engagement with council: "They're not bothering to come up and stand in front of council to explain it and justify their budget," he said.

Hearn said some council members hadn't seen Ginn before the alliance's current problems erupted. Ginn appeared at Dorchester County Council on Monday night.

Hitt, the Commerce secretary, met with officials from the three counties Friday to discuss the recent turn of events.

Berkeley County Supervisor Dan Davis said the meeting was informational.

"He really didn't give us any suggestions," Davis said. "He gave us some feedback. Both sides let each other know what is going on."

He said representatives of the three counties will probably get together soon to discuss the next course of action.

Meanwhile, the alliance's executive committee will meet at 1 p.m. Monday. The agency's funding is on the agenda.

Reach Warren L. Wise at 937-5524 or twitter.com/warrenlancewise.

Comments { }

Postandcourier.com is pleased to offer readers the enhanced ability to comment on stories. We expect our readers to engage in lively, yet civil discourse. Postandcourier.com does not edit user submitted statements and we cannot promise that readers will not occasionally find offensive or inaccurate comments posted in the comments area. Responsibility for the statements posted lies with the person submitting the comment, not postandcourier.com. If you find a comment that is objectionable, please click "report abuse" and we will review it for possible removal. Please be reminded, however, that in accordance with our Terms of Use and federal law, we are under no obligation to remove any third party comments posted on our website. Read our full Terms and Conditions.