A new bill would likely lower the pay for Tennessee Valley Authority’s (TVA) CEO, bringing the controversial salary down to a level comparable with those of CEOs at other public utilities.
TVA CEO Jeff Lyash made $9.9 million last year. His base salary of $1.1 million was upped from a series of bonuses after he helped the federal utility meet or exceed some long-term and short-term corporate goals. His salary makes Lyash the highest-paid federal employee, far outpacing even the U.S. President’s pay of $400,000.
TVA has long defended its pay. For one, it says, salaries are not paid with taxpayer dollars but with revenue from electricity sales. Also, TVA has said pay, especially for its CEO, must be high to recruit and retain leaders who could make such salaries at other companies.
“The entire industry is competing for this talent as we all work toward a collective goal of a carbon-free energy future,” TVA spokesman Scott Brooks said in a statement. “That’s why we routinely benchmark with other utility peers to create a competitive compensation system. This ensures we have a well-rounded, diverse and skilled workforce that can deliver the outcomes our customers expect, including keeping rates low.”
However, TVA has been heavily criticized on the compensation. In 2020, President Donald Trump called Lyash’s pay “ridiculous” and threatened (but failed) to cut that pay “by a lot.”
In February, Rep. Tim Burchett (R-Knoxville) and Rep. Steve Cohen (D-Memphis) filed a bill to make TVA’s top salaries more transparent. The bill would require the government-owned corporation to list salary information for any employee making more than around $240,000.
“Southeastern communities should be able to evaluate if those salaries match the service provided by TVA.”
Rep. Tim Burchett (R-Knoxville)
“TVA’s top earners are paid generously, and Southeastern communities should be able to evaluate if those salaries match the service provided by TVA,” Burchett said in a statement at the time. “Compensation transparency from TVA’s key decision makers is important for maintaining the public’s trust.”
A bill filed by Cohen Friday takes the issue further, likely lowering pay for Lyash and other TVA executives. Current law only requires TVA’s salaries to be on par with any other power provider in the U.S., including private, for-profit companies. Cohen’s bill would make compensation comparable to “compensation of executives in public utilities in both the U.S. and Canada.”
“It is past time to get realistic about TVA salaries and to do so fairly and transparently.”
Rep. Steve Cohen
“It is past time to get realistic about TVA salaries and to do so fairly and transparently,” Cohen said in a statement. “Electricity generation and transmission managed from Knoxville should not earn its CEO three times what a typical Canadian utility CEO makes. The comparison I am suggesting may open some eyes and restore some reality to compensation at TVA.”
A statement from Cohen’s office said a review by the Congressional Research Service found CEOs of “Canadian power companies make significantly less in annual total reported compensation than American CEOs.”
Salaries are not paid with taxpayer dollars but with revenue from electricity sales.
In May 2020, former Tennessee Senator Lamar Alexander — a longtime TVA supporter — claimed (in a Knoxville News-Sentinel opinion piece) that Lyash’s salary ranked in the bottom fourth among “big utility CEO salaries.”
“The Tennessee Valley Authority plays in the big leagues.”
former Tennessee Senator Lamar Alexander
“The Tennessee Valley Authority plays in the big leagues,” Alexander said. “It is our country’s largest public utility, a $10 billion company serving 10 million residents in seven states. Big utilities pay big salaries to attract the best executives.”