High-paid Port CEO may get raise, then retire soon

Mic Dinsmore is paid more than any other top executive at a major U.S. port, and he's due to retire in less than six months.

Today Port of Seattle commissioners are due to consider awarding him a 6 percent raise that would boost his annual salary by $16,400 and lock in an extra $3,000 a year in future state pension benefits.

If he gets the raise, the 61-year-old Dinsmore would have a final pay packet of $339,841 a year — substantially more than his peers at other big ports — and more than double the $150,995 Gov. Christine Gregoire earns as chief executive of the state.

Commission President Patricia Davis said she thinks he's earned an annual raise, and she is confident the commission will give it to him.

But several commissioners said Dinsmore's performance as chief executive officer doesn't merit such an increase.

"I'm disappointed in our financial performance this year," Commissioner Alec Fisken said. He cited a proposal to increase the Port's tax levy as a chief concern, as well as plans to build a new cargo terminal that would require the Port to tear down an $18.2 million cruise-ship terminal opened in 2003.

Under the Port's pay-for-performance system, Dinsmore would need to be rated "outstanding" to qualify for the top 6 percent raise.

Commissioner Lloyd Hara gives Dinsmore a grade of "progressing," which carries a zero to 2 percent raise.

Though some projects have moved ahead, like the third runway at the airport, numbers for cruise and cargo business have been dropping.

"Have we had a greater tonnage through here? No," Hara said.

Bigger raise proposed

Commissioner John Creighton said some commissioners proposed a 10 percent raise.

"I just thought that was not warranted," Creighton said. Even the 6 percent proposed raise is on the high side of what he wanted, he said.

Dinsmore already earns more than chiefs at comparable major ports: Los Angeles pays $240,000 a year; Boston, $250,000; New York-New Jersey, $237,000.

Dinsmore's income of $323,435 includes $273,435 in salary (to which the raise would apply), and an additional $50,000 in deferred compensation. None of the comparison ports pay deferred compensation.

The deferred payment is similar in structure to what University of Washington President Mark Emmert receives. Last week Emmert got a package worth $718,700, including deferred compensation of $200,000.

"That's what we did seven years ago, partly as a tin-handcuffs kind of thing" to encourage him to stay, Davis said of Dinsmore's package. "It wasn't a huge amount of money."

Supplemental deferred compensation is unusual even among private-sector chief executives, according to The Corporate Library, a non-profit corporate-governance research firm.

Deferrals typically are taken from base salary and put into a retirement investment account, to be taken after the executive retires, when income and taxes are usually lower.

In Dinsmore's case, by contrast, the Port is "crediting him with extra money under this deferred compensation plan and it's supplemental," said Alexandra Higgins, a Corporate Library analyst.

"It would be highly controversial if this were a CEO of a public corporation," she said.

Deferred compensation

The Port would not say how much Dinsmore has built up in his deferred-compensation account.

But based on his contract, he apparently will receive more than $362,000 in deferred compensation from the Port in a lump sum when he retires early next year.

Starting in 2001, the Port paid $50,000 a year into the account. From 1996 to 2000, it paid him a supplement equal to 8 percent of his base salary.

Dinsmore also is enrolled in the state's Public Employee Retirement System. Under that plan, he's eligible for about $85,387 a year when he retires. If he gets the 6 percent raise, his annual retirement benefit would rise to about $88,395.

Dinsmore's biggest raise — 25 percent — came in 2001, when the deferred-compensation payment jumped to $50,000.

He skipped raises twice: when he took the top job in 1992, and in 2004, when the Port was cutting staff.

Dinsmore was at an airport conference in France and couldn't be reached for comment.

While some commissioners questioned the need to further compensate him, others said a raise is well-deserved.

"I feel that Mic has done a tremendous job," Commissioner Bob Edwards said. "Recognizing that this is going to be his last year, it's probably appropriate that you take the perspective that this was a 15-year run of the chief executive."

He added that Dinsmore is not at the top of the possible range of salary open to him under his contract — which for the current year would mean a base salary of $297,239.

"Some years he chose not to take an increase, probably not realizing that once he decided to step down that there was no way he could be at the top of the range."

Alwyn Scott: 206-464-3329 or ascott@seattletimes.com