California "Charitable Hospital Executive Compensation Act" Initiative (2014)

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A California "Charitable Hospital Executive Compensation Act" Initiative (#13-0042) was approved for circulation in California as a contender for the November 4, 2014, ballot as an initiated state statute.

The initiative would have:

  • Prohibited nonprofit hospitals, hospital groups, hospital-affiliated medical foundations and physicians groups from paying annual compensation (salary, perks, paid time off, bonuses, stock options, etc.) or providing severance packages to executives, managers and administrators in an amount exceeding the salary and expense allowance of the President of the United States.
  • Required annual public disclosure of the ten highest-paid executives and the five largest severance packages.
  • Authorized the Attorney General of California to monitor and enforce the initiative's provisions.
  • Provided penalties for violation of the initiative's provisions, including fines, revocation of a hospital's tax-exempt status and the appointment of a representative of the state's Attorney General to a hospital's board of directors.

Supporters of the initiative referred to it as the "Charitable Hospital Executive Compensation Act of 2014."

The SEIU and the California Hospital Association (CHA) negotiated a deal that resulted in the union withdrawing the ballot initiative and the "Fair Healthcare Pricing Act" Initiative. The CHA, in exchange, approved a new “code of conduct” that may make union organizing easier.[1]

Text of measure

Ballot title:

Nonprofit Hospitals. Executive Compensation. Initiative Statute.

Official summary:

"Prohibits nonprofit hospitals, hospital groups, and hospital-affiliated medical foundations and physicians groups from paying annual compensation (salary, perks, paid time off, bonuses, stock options, etc.) or providing severance packages to executives, managers, and administrators in an amount exceeding the salary and expense allowance of the President of the United States(currently $450,000). Requires annual public disclosure of ten highest-paid executives and five largest severance packages. Authorizes Attorney General monitoring and enforcement or taxpayer litigation. Penalties for violation include fines, revocation of tax-exempt status, and appointment of Attorney General representative to board of directors."

Fiscal impact statement:

(Note: The fiscal impact statement for a California ballot initiative authorized for circulation is jointly prepared by the state's Legislative Analyst and its Director of Finance.)

"State administrative costs in the low millions of dollars annually to enforce the measure, with authority to recover costs through fees assessed on nonprofit hospitals."

Support

Service Employees International Union-United Healthcare Workers West (SEIU-UHW) sponsored the initiative and the "Fair Healthcare Pricing Act" Initiative.[2]

Supporters

Opposition

Opponents

  • California Hospital Association[3]

Polls

See also: Polls, 2014 ballot measures

The SEIU, an initiative proponent, commissioned a poll to gauge the public’s responsiveness to the initiative. One question asked was, “What do you think is a fair salary for a CEO of a nonprofit hospital in California?” The initiative would cap pay at $450,000. Of the respondents, 77% thought a “fair salary” was $450,000 or less. The following poll data represents the responses:[4]

California "Charitable Hospital Executive Compensation Act" Initiative (2014)
Poll Less than $200,000 $200,000 – $450,000$450,000 – $600,000$600,000 – $1,000,000$1,000,000 – $3,000,000$3,000,000 or MoreUnsureMargin of ErrorSample Size
SEIU (Commissioned by)
Reported March 4, 2014
38%39%8%2%2%1%9%+/-2.91,160
Note: The polls above may not reflect all polls that have been conducted in this race. Those displayed are a random sampling chosen by Ballotpedia staff. If you would like to nominate another poll for inclusion in the table, send an email to editor@ballotpedia.org.

Path to the ballot

See also: Signature requirements for ballot measures in California
  • Rebecca Malberg and Stanley Lyles submitted a letter requesting a title and summary on November 8, 2013.
  • A title and summary were issued by the Attorney General of California's office on January 3, 2014.
  • 504,760 valid signatures were required for qualification purposes.
  • Supporters had until June 2, 2014, to collect and submit the required number of signatures, as petition circulators are given 150 days to circulate petitions.
  • The Secretary of State’s suggested signature filing deadline for the November 4, 2014, ballot was April 18, 2014. This means that if supporters had submitted enough valid signatures by June 2 but after April 18, the measure could have been pushed back as far as the next statewide general election, in November 2016.
  • On May 6, 2014, the SEIU withdrew the initiative due to a deal with the California Hospital Association.[5]

External links

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References


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