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Senate panel reviews bill to limit severance pay for public executives
Summary
House Bill 762 would cap severance pay for political-subdivision executives at 20 weeks of compensation, bar severance for terminations for misconduct, require publicly posted severance agreements, and exempt teaching hospitals; committee left the bill pending after no public testimony was registered.
The Senate Committee on Local Government considered House Bill 762, which would limit severance pay that political subdivisions may offer to executives.
Senator Bettencourt, explaining the bill, said many public executive contracts include large severance clauses that can result in substantial taxpayer-funded payouts even when employees are dismissed for misconduct or poor performance. Under the bill, severance would be limited to 20 weeks’ compensation, severance would be prohibited if an employee is terminated for misconduct, severance agreements would be required to be posted publicly for transparency, and teaching hospitals would be exempted due to market-competition concerns.
Senator Bettencourt said the measure is similar to Senate Bill 2,237 (earlier committee action) and that the teaching-hospital exemption was a key difference from a companion proposal. No members of the public registered to testify; the committee closed testimony and left the bill pending.
Supporters said the bill seeks to limit taxpayer exposure to large payouts and to improve transparency of executive compensation in local government.
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