Gov. Eric Holcomb comments on spot bonuses across agencies, including the Indiana Economic Development Corporation, at the National FFA conference on Nov. 1. Photo by Whitney Downard from Indiana Capital Chronicle.

By Whitney Downard
Indiana Capital Chronicle

INDIANA — The Indiana Economic Development Corporation doesn’t have the largest headcount, but the relatively small state agency spent an outsized amount of taxpayer dollars on spot bonuses totaling $1.2 million over two years for a department with 114 employees.

For comparison, the state’s largest agency — the Indiana Department of Correction — has 5,149 employees and spent a total of $1.7 million over the two years analyzed. Combined, 10 of the state’s largest agencies spent over $5 million in bonuses, with average payouts ranging from an IEDC high of $2,973 to a low of $231 at the Department of Environmental Management.

Out of the 10 agencies analyzed by the Indiana Capital Chronicle, the IEDC stood out for its hefty, repeated bonuses, including a total of $52,700 over two years to David Rosenberg, formerly the chief operating officer and chief of staff and now the head of the agency.

Gov. Eric Holcomb defended agency spot bonuses overall, which were revamped as part of his 2022 approach to address low state employee retention, and praised the quasi-public IEDC for superseding its goals.

“We set a record (in 2021) at $8.7 billion,” Holcomb continued. “Last year, they did $22.2 billion in capital investment. So not only did they surpass … they far exceeded it.”

The IEDC is a quasi-governmental agency, which means it has greater autonomy and less public transparency.

More on IEDC bonuses

Through a spokesperson, the IEDC shared its 12-page compensation plan and detailed how spot bonus data obtained from the Comptroller’s Office actually included three different categories of bonuses: traditional spot bonuses recognizing job performance, incentive compensation bonuses tied to biannual performance reviews and sign-on bonuses used to “recruit top talent.”

According to Erin Sweitzer, the agency’s vice president of external communications, spot bonuses for 2022 totaled $10,175 and $131,850 for 2023. Sign-on bonuses totaled $6,000 and $11,500, respectively, while the bulk of the bonuses fall under incentive compensation — $619,250 for 2022 and $422,177 for 2023 so far.

Bonuses are tied to the agency’s performance, Sweitzer said.

Data showed bonuses from the agency generally went out in waves, including $292,250 in June 2022, $327,250 in early November 2022 and $418,177 in July 2023. Sweitzer said the second biannual bonus for 2022 went out in November, instead of December, because the agency hit its goals early.

The shared compensation guide included the agency’s calculation for determining bonuses, which considered a hiring date, whether that goal was exceeded and weighed the goal based on its strategic importance.

She noted that spot bonuses alone “generally adhere” to guidelines from the State Personnel Department, which caps such awards at $1,000 and doesn’t include multiple perks per year.

Sweitzer said such bonuses were at the discretion of the department’s executive team and employees received multiple awards at times when they had “earned a promotion and/or pay increase” but salaries couldn’t be adjusted at the same time due to “financial and administrative constraints.”

Big bucks at state agencies

The ICC’s analysis of 10 key state agencies’ spot bonuses covered 69% of all state employees, not including 2% of state employees from a previous investigation into spot bonuses at offices led by elected officials.

In terms of average bonus, IEDC led the pack with an average award of $2,973 over 404 bonuses followed by the Department of Education, which averaged $2,625 across just four bonuses.

The IEDC also had the highest maximum bonus at $11,700, again followed by the Department of Education, which doled out one $5,000 bonus.

Though the Bureau of Motor Vehicles has just 1,449 employees, the agency gave out 5,990 bonuses — spending a total of $997,009 but averaging just $167 per bonus.

Similar to the IEDC, the BMV clarified that it had several bonus programs all lumped under the ‘spot bonus’ designation at the Comptroller’s Office. Totals for each category included: $67,208 in traditional spot bonuses; $528,438 in branch operations quarterly bonuses; $400,863 for kiosk bonuses; and $500 in referral bonuses.

Melissa Hook, the BMV communications and media relations director, said the branch operations quarterly bonus program specifically helped recognize “outstanding performance” for two of the department’s most challenging roles: customer service representatives and team leaders. Kiosk bonuses include branch team members and regional managers and is based on the percentage of transactions processed at a BMV Connect kiosk.

Of the 10 agencies analyzed, just two adhered to the SPD suggested maximum of $1,000 — the Department of Health and the Department of Environmental Management.

Two agencies with long-standing recruitment challenges, the Department of Child Services and the Department of Correction, both stood out for having higher maximum awards ($2,289 and $3,098, respectively) and high overall spending.

DCS, in a statement, said it awarded bonuses bigger than $1,000 to offset withheld taxes and as part of a SPD-approved recruitment initiative for family case managers.

Party heads weigh in

The awarding of bonuses was left largely up to agencies, Holcomb said.

Holcomb acknowledged that his own office abided by guidelines from the SPD, which caps bonuses at $1,000, but not all departments fell under its purview — including his own and others led by elected officials.

But the Indiana Democratic Party observed that the embattled IEDC had much of its activity obscured from public scrutiny and spent “millions of taxpayer dollars in the dark.”