The new contract awarded to Fairview Heights Economic Development Director Mike Malloy includes performance-based incentives that could boost his annual pay by as much as $15,000.
The $86,800 salary was approved by City Council members last week after the council had voted down a previous contract for $97,000. However, Malloy stands to make as much as was proposed in the initial contract, if not more.
According to the contract, Malloy stands to earn incentives based on points, depending on the accomplishment. One to two points are worth $2,500, and 13 or more points are worth $12,500.
Malloy could not be reached for comment.
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The contract stipulates one point for “retention or expansion of any existing business” and up to three points, worth $5,000, for leading the “development and approval of a (tax increment finance district) or enterprise zone application.”
He earns four points, also worth $5,000, for “filling of each vacant space in excess of 2,500 square feet up to $7,500 square feet or greater, or the tenant generates sales in excess of $250,000 up to $500,000 annually” and another four points for “spearheading a new city project for business development” through grants, sales tax incentives, streetscape and financing.
Mayor Mark Kupsky said some of these objectives have only been accomplished once in the city. He said the point system not only benefits Malloy, but the city as well.
If he earns the points and brings in development to the city, that’s great for the community. That means he is stabilizing our retail base and economic base, and we will compensate him for these efforts.
Mark Kupsky, Fairview Heights Mayor
“If he earns the points and brings in development to the city, that’s great for the community,” Kupsky said. “That means he is stabilizing our retail base and economic base, and we will compensate him for these efforts.”
Although Malloy’s previous contract, which expired earlier this year, did not include performance incentives, Kupsky said he and other elected city officials have had similar criteria in their own jobs in the private sector. He also said former city administrator Drew Awesome had performance-based incentives included in his contract.
Current city administrator Jim Snider said including such incentives are not unusual for economic development director’s contract considering his job.
“His job is a salesman,” Snider said. “He’s selling the city.”
The current contracts for the economic development directors working in other metro-east municipalities, such as O’Fallon and Edwardsville, do not include performance incentives. In Collinsville, the city currently does not have an economic development director. Collinsville’s most recent economic development director’s contract had not included any performance incentives.
Eight of the nine Fairview Heights City Council members voted in favor of the new contract. The lone dissenter was Ward 1 Alderman Dennis Baricevic, who said he believed that both the first and the second contract were too high.
“It was too high of a percentage raise to me, even without the bonus,” Baricevic said. “I thought it was too high of a raise when we fought the unions very hard to get them about 3 percent. I don’t know the exact number, but it was definitely not double digits.”
Malloy’s new contract replaces a previous one that paid him $70,720 a year. He also receives $350 a month for a car allowance, health insurance and will be covered by the Illinois Municipal Retirement Fund — all of which was included in his previous contract.
The new contract is retroactive to May 19, 2015, and expires Dec. 31, 2017.
Malloy was initially hired by the city in 2011, after having served in a similar position in Belleville for 10 years until 2007.