Sacramento County's retirement system has approved raises of 13 percent to 22 percent for its top executives.

Richard Stensrud, chief executive officer of the Sacramento County Employees' Retirement System, or SCERS, defended the increases for the six executives, saying salaries had fallen out of line with those at other public retirement systems in California.

But pension reform advocates and union leaders say the pay hikes show the system is out of touch. Sacramento County is in its fourth straight year of budget cuts and having to pay millions more into the pension plan each year.

"I'm appalled," said Ted Somera, executive director of United Public Employees Local 1, the county's biggest union. "We've had employees laid off who were making $30,000 a year, and they're worried about keeping up with the Joneses."

Stensrud said money from the raises comes from the pension trust – dividends from the system's investments. However, Sacramento County and other agencies are responsible for ensuring the system has enough money to pay its obligations to retirees.

SCERS is responsible for managing the retirement plan for the county, the county's Superior Court and some special districts.

Dan Pellissier, president of California Pension Reform, said the raises are poorly timed.

"There's a certain tone deafness in executives enriching their pay while government budgets face deep deficits and pension funds have debts that will take generations of taxpayers to pay," he said.

Raises were approved for the chief executive, chief and deputy investment officers, chief operations officer, chief benefits officer and general counsel.

Those positions will pay between $147,000 and $198,000 when the raises are fully phased in over two years, with the exception of compensation for the general counsel. The system's attorney is retiring, and the system wants to raise the position's pay immediately after his departure to attract candidates, Stensrud said.

SCERS board approved the raises last week by a 6-1 vote. Diana Gin, a human resources manager for the county, was the only board member to oppose the raises.

Gin would not comment about her vote Monday. Only one of the board's other members would explain her vote to The Bee, with other members declining to comment or not returning phone messages.

Kathy O'Neil, a human services supervisor for the county who sits on the board, said she approved the raises because a salary survey showed the system's executives were paid less than counterparts elsewhere in the state.

Board members are appointed by the Board of Supervisors, elected by labor or retiree groups, or in the case of county Finance Director Julie Valverde, appointed by law.

Stensrud said he realized the pay hikes could generate criticism because of the state of the economy and the county's financial hardships.

"Unfortunately, our hand is now being forced by the need to replace a critical executive team member," Stensrud said, referring to the general counsel.

Somera said SCERS should have raised the pay for that position, if that's all that was needed.

Stensrud said keeping pay at existing levels could lead to turnover in other executive positions. SCERS executives have not received an equity raise since 2006 and have not received cost-of-living increases since 2008, he said.

The system commissioned a salary survey to determine the raises. The survey looked at pay at 22 retirement systems, including SCERS, and recommended salaries at the median, with adjustments for cost-of-living differences in the communities.

Most of the agencies had similar-sized plans as SCERS, which manages a $6 billion fund. But CalPERS and CalSTRS, state plans that are hundreds of times bigger, were also included, and higher executive pay at those agencies helped drive up the median used in the survey.

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Call The Bee's Brad Branan, (916) 321-1065. Follow him on Twitter @ BradB_at_SacBee.

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