Former state commerce chief Don Cardon is going to get most of his performance bonus even though he quit the agency long before the end of his three-year contract.
Gov. Jan Brewer disclosed Thursday she had signed the agreement to give Cardon $60,657 out of the $75,000 incentive package promised him when he took the job as chief executive of the Arizona Commerce Authority — and signed a three-year contract — less than a year ago. Gubernatorial press aide Matthew Benson said his boss believes he had met most of the goals and was entitled to the cash.
The money, however, is not going to come from taxpayers. Instead, the bonus is being paid by Team ACA, a separate private group which Cardon heads which collects money from corporations to pay his salary and bonus.
But that arrangement has raised questions from the Arizona Public Interest Research Group.
Serena Unrein, a public interest advocate for the group, pointed out that Team ACA does not disclose who is contributing to its coffers even though the money eventually winds up being used to pay the bonus and some of the benefits of the state agency’s most powerful officer. While Team ACA put up cash towards Cardon’s salary and bonus, an authority spokeswoman said no decision has been made whether the same arrangement will be made for a yet-to-be-hired replacement.
“The public deserves to know how the commerce authority CEO, whether it’s the past one or the incoming one, is being compensated,” she said.
“They can control, our research shows, up to $150 million in tax credits and grants each year,” Unrein continued. Disclosure of the sources of those funds, she said, would ensure “there isn’t any chance of corruption or fiscal irresponsibility.”
Nicole McTheny, the authority’s marketing manager, deflected questions about the original source of the money used to pay Cardon’s bonus as well as a $30,000 “wellness/health allowance.” That was in addition to his $300,000 annual salary.
“Team ACA is a separate, private organization, so these questions should be directed to that organization,” she said.
But Cardon, who heads Team ACA, did not immediately respond to inquiries.
Benson provided a similar response.
“The governor is committed to ensuring the Arizona Commerce Authority adheres to all legal requirements related to financial disclosure and transparency,” he said. “Team ACA, of course, is a separate entity with its own set of regulations governing financial donations.”
Whatever the source of the funds, Benson said Brewer was “absolutely” in agreement with the decision of the commerce authority board, which she chairs, to give Cardon most of the $75,000 bonus.
“That performance bonus was established according to the formula based on specific performance benchmarks,” he said.
One of those involves jobs brought into the state. The contract said Cardon’s goal was 9,000 jobs; the deal negotiated between Cardon and the authority gave him credit for 5,610 jobs
With job creation being 35 percent of the formula, that entitled him to $16,362.
Similarly, the pact credited him with creating $401 million in new capital investment out of a $500 million goal for another $18,045.
But the deal provided another $26,250 for developing the authority’s five-year plan.
Cardon is no stranger to controversy over bonuses.
He was given $50,000 when he signed the three-year contract last September, becoming the authority’s head after it was created to replace the state Department of Commerce. In January, Cardon agreed to refund that bonus, minus taxes paid.
His $300,000 salary itself also caused a stir, at least in part because he was being paid only $183,000 as head of the Department of Commerce. But Brewer defended the move.
“We abolished the Department of Commerce and we then established the Arizona Commerce Authority,” she said at the time. She said it was up to the board of this new authority — herself included — to screen applicants and determine an appropriate salary.
Brewer also said it was irrelevant that the job went to Cardon, saying he was not going to be doing the same job at the authority as he was before. She said that is necessary, saying Arizona “has not been a leader” in economic development under the old Commerce Department.