The compensation package of PPL Corp.'s top boss totaled nearly $10 million last year, according to the Allentown energy company's regulatory filing this week. That's the largest sum ever reported for a sitting PPL chief executive officer.
In 2007, CEO James Miller was paid a salary of $1 million and incentive pay of $1.6 million, and he received stock and options valued at $3.1 million.
The value of his projected pension increased by $3.9 million. Since last year, the U.S. Securities and Exchange Commission has required public companies to count this as compensation, even though it is money executives can't get their hands on before retirement.
Additionally, Miller, who also carries the titles of president and chairman, received $32,000 for his 401(k) and financial counseling, among other things.
The $9.7 million total reported for 2007 was 73 percent more than in 2006, when Miller replaced PPL's retiring longtime boss, William Hecht. Not including pension, Miller's compensation last year was $5.8 million, or nearly as much as what Hecht made in his final year at the company.
News of the increase in Miller's compensation package comes amid simmering anger over PPL's plan to implement an unprecedented rate hike on Jan. 1, 2010, the final step of electricity deregulation. The price of electricity at that time is expected to surge 35 percent for residents and up to 42 percent for some businesses.
"How could they justify that when they want to raise rates?" Sen. Lisa Boscola, D-Northampton, asked Thursday after being told of Miller's compensation. "It sends the wrong message to people who are working a second job to pay their bills."
Boscola, who has drafted a bill that would block the 2010 rate hike, said PPL's CEO pay is part of a larger problem. "It's not just this company, it's all of corporate America. ... It's about anything they can do for the bottom line. There's not even an allegiance to the state or country anymore."
In its proxy filing, which PPL described as preliminary, the company said Miller's pay raise was based on his performance.
"The company was able to improve earnings, despite significant challenges presented by unplanned outages at several power plants, and Mr. Miller put in place an important process to identify future growth opportunities for the company," PPL said.
Although much higher than last year, Miller's pay was not out of line with that of other American CEOs. In Forbes magazine's 2007 analysis of CEO pay at the biggest 500 companies in the country, the median was just over $7 million -- far more than is typical in Europe and other parts of the world.
As a group, American CEOs today receive proportionally much more than their employees than they ever used to, and their pay raises stand in contrast to the inflation-adjusted decline of the minimum wage.
CEO pay was 364 times that of an average worker in 2006, up from 107 times average pay in 1990, according to a report by the Institute for Policy Studies and Citizens for a Fair Economy. By comparison, the value of the minimum wage -- even after a 60-cent increase to $5.85 last year -- declined 7 percent after
inflation during the previous decade.
Other PPL executives also received seven-figure compensation packages last year, according to the company's proxy filing.
Chief Operating Office William Spence, for example, got more than $2 million. That included a base salary of $597,000, incentive pay of $712,000, stock and options worth about $374,000, and deferred pay and pension valued at $287,000, as well as other compensation worth nearly $40,000 for financial counseling and other benefits.
PPL executive's compensation package: $9.7M
State senator calls it corporate greed at time of planned rate hike.
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