Request for Proposals – CEO Compensation Study

Last Updated: 9/20/2025 (see below)

Del Puerto Health Care District (DPHCD) is seeking proposals from qualified consultants to provide a CEO compensation study, including best practices, a recommended compensation policy, and a salary survey with incentive and merit pay components.

This effort reflects the Board’s commitment to transparency, accountability, and alignment with industry standards.

Key Dates

• Issue Date: September 11, 2025
• Intent to Submit (via email): September 19, 2025 – 4:00 PM PST
• Questions Due (via email): September 19, 2025 – 4:00 PM PST
• Proposal Due: September 26, 2025 – 4:00 PM PST
• Award Date: September 29, 2025

Final Presentation: Monday, October 27, 2025 (Regular Board Meeting) Please note the correction of the presentation date.

Scope of Work

• Identify CEO compensation best practices for public-sector health care districts.
• Develop a recommended CEO Compensation Policy, including incentives, merit pay, and transparency guidelines.
• Conduct a CEO Salary Survey focused on non-hospital health care districts, adjusted for regional differences, with benchmarks for pay, incentives, and benefits.

Deliverables

• Written report, draft policy, and survey results (PDF/Word) by October 21, 2025.
• Final presentation to the Board on October 28, 2025.

RFP Submission Instructions

Proposals must be submitted electronically in PDF format to:

• Karin Freese, CEO – karin.freese@dphealth.org
• Becky Campo, Board President – becky.campo@dphealth.org

Deadline: September 26, 2025, at 4:00 PM PST

Mission: To Provide, Promote, and Partner in Quality Health Care for All.

REQUEST FOR PROPOSAL - updated on 9/16/25

RFP QUESTIONS #1-3 - updated 9/16/2025 

1.      Are you interested in just CEO base compensation, or are you also interested in including benefits as well (base vs. total compensation)?

• The District is interested in base compensation plus an incentive/bonus structure based on multi-year strategic plan milestones and annual goals,
• The District’s health benefits of medical, dental, vision, and group life insurance plus a guaranteed contribution retirement plan are the same for all employees. the District does not intend to have different benefits for the CEO.

 2.      Do you have a required deadline for the completion of the study?

           As stated in the RFP, the deadline for completion of the study has two parts:

• Written report, draft policy, and salary survey results delivered in both PDF and Word formats no later than October 21, 2025, and
• A final presentation at the October 27, 2025, regular Board meeting.

3.      Are you comfortable with the study being conducted 100% virtual?

• As stated in the RFP, the meetings may be conducted in person or virtual; however, the Board prefers in-person.

RFP QUESTIONS #4-5 - updated 9/18/2025 

4. For the incentive and bonus program element that is to be based on strategic goals and objectives, could you clarify the Board’s expectations? Specifically, are you seeking a review of the existing plan with commentary and suggestions for alternative strategic metrics, assistance with designing a new plan, or a different type of support altogether?

• While the District has an established strategic planning methodology, it does not currently have a policy or metric that ties directly to a CEO incentive program. The Board’s intent is to create stronger alignment between CEO performance incentives and the advancement of our adopted strategic goals. Since an incentive program for leadership has never been implemented at DPHCD before, this would be an inaugural effort. The focus is not on redefining the goals themselves, but rather on designing a method to quantify achievement and link it to incentive pay. Specifically, the Board is seeking a framework that measures the extent of annual goal accomplishment and progress on strategic objectives, with incentive awards structured as a percentage of base salary tied to those outcomes.

5.      Can any components of this work be completed in a phased approach, or are all elements considered priority and expected to be finalized by October 21 for the Board meeting on October 28? We ask because most CEO compensation plan reviews and market studies typically require significantly more time to ensure thorough analysis, benchmarking, and thoughtful alignment with governance and best practices.

• We recognize that comprehensive CEO compensation studies typically require more time for benchmarking and best-practice analysis. However, the Board has requested to review preliminary salary findings and recommendations at its October 28 meeting. With this in mind, we welcome a proposed phased approach:
  • Phase 1 (by October 21): Provide preliminary salary benchmarking, high-level compensation philosophy considerations, initial commentary on the incentive/bonus program, and recommendations for consolidating existing CEO compensation-related policies into a more streamlined framework. These initial findings will allow the Board to engage in timely discussion.
  • Phase 2 (final report due November 17): Deliver the full, detailed market study, refined incentive plan options, and a comprehensive policy consolidation roadmap that ensures alignment with governance standards and best practices.

RFP QUESTIONS #6-9 - updated 9/19/2025

6.      Since potential suppliers will not be qualified to offer legal advice, please clarify what deliverable is intended by “legal requirements for public-sector executive compensation.”

The intent of the phrase “legal requirements for public-sector executive compensation” in the RFP is not to request legal advice from suppliers. Rather, the District expects proposers to demonstrate awareness of the public accountability standards that apply to California healthcare and special districts, including:

• Transparency laws (Brown Act): Final action on CEO compensation, employment contracts, or amendments must be approved by the Board of Directors in open session, ensuring the public has visibility into executive pay decisions.
• Compensation and severance limits (Gov. Code §§ 3511.1 and 53262): Public agencies are prohibited from providing excessive compensation relative to services performed, and severance payments are capped at no more than 12 months’ salary and benefits.
• Public reporting (Gov. Code § 12463): All public agencies must report executive compensation annually to the State Controller, which publishes the information on publicpay.ca.gov.

The deliverable the District seeks is a summary of best practices and survey results that take these statutory guardrails into account—for example, ensuring that recommendations are consistent with transparency standards, reasonable in comparison to peers, and compliant with state law on compensation and severance. 

The consultant’s role is to reflect these requirements in the analysis and policy recommendations. The District, not the consultant, will obtain any formal legal interpretation if needed.

7.       With respect to the use of “survey”, please confirm our assumption that the District does not intend for its compensation consultant to structure a formal written survey instrument and use it to solicit data from specific contacts at selected organizations.

Your assumption is correct that the District is not asking the consultant to design or distribute a formal written survey instrument to other agencies. The intent of the RFP is for the consultant to conduct a compensation survey analysis based on reliable and available sources of information.

• To avoid ambiguity, we ask proposers to describe the methodology they will use to obtain and analyze compensation data, including:
• Which data sources will be relied upon (e.g., State Controller’s PublicPay database, published labor market surveys, Bureau of Labor Statistics, private sector resources).
• How comparators will be selected (e.g., healthcare districts of similar size, special districts, private/nonprofit roles in comparable geographies).
• How geographic pay differentials will be incorporated, with reference to the Cost of Labor Index.
• Any assumptions, limitations, or adjustments they will apply in interpreting and presenting results.

The District is seeking a transparent explanation of how compensation comparisons will be developed, rather than a new survey sent to peers. This ensures the Board and community understand the basis for any recommendations.

8.      When was the most recent update made to the District’s peer group of comparable health care and public administration organizations that it uses to evaluate compensation levels and benefits for similarly qualified individuals in comparable positions at similar organizations?

The District has used the same methodology for identifying a peer group of comparable health care and public administration organizations since 2018, and that methodology was most recently applied in connection with the District’s 2025 salary survey update.

The current RFP reflects the Board of Directors’ desire to have this work independently verified by having an external consultant conduct the CEO compensation study.

This approach ensures the Board can rely on a transparent and independently validated benchmark when making future CEO compensation decisions.

9.      On occasion, we have designed our approach (e.g., survey method, number of benchmark classifications and level of participant validation activities, etc.) based on the client’s budget.  As such, has the District determined a maximum overall budget for this engagement and whether such budget will be spread over more than one fiscal year?

The District has not set or disclosed a fixed budget for this project. As stated in the RFP, cost is one of the weighted evaluation criteria. Proposers are expected to provide a detailed cost proposal that reflects their methodology, staffing, and approach. The Board will evaluate the reasonableness and value of each cost proposal relative to the scope of work and deliverables.

RFP UPDATED QUESTIONS: April 20, 2025

10.     Do you currently participate in any surveys for CEO benchmarking in addition to a custom peer group? Can you please share which ones?

The District does not currently participate in any surveys for CEO benchmarking.

11.      When was the last time CEO compensation was evaluated?

(See answer in Question #8)

12.     In the Scope of Work section 2, DPHCD refers to a CEO compensation “policy.” Can you please clarify what in-scope components / elements comprise the policy?

The District’s compensation policies (attached), accumulated over several years, were originally intended to create a single framework for District-wide pay practices. However, the Board has recognized the need for a separate, stand-alone CEO compensation policy that consolidates expectations and ensures clarity and transparency.

The CEO compensation policy is expected to address the following components:

• Frequency of study updates: How often a formal CEO compensation study must be conducted.
• Third-party requirement: Confirmation that all compensation studies must be completed by an independent consultant.
• Salary range structure: Guidance on what spread should be included in the CEO’s salary range.
• Use of PUBLICPAY.CA.GOV data: Direction on how to account for timing gaps in the State Controller’s PublicPay.ca.gov reporting (e.g., May 2025 salary evaluations rely on CY 2023 data because CY 2024 data will not be posted until September 2025).
• Annual adjustment methodology: The process for applying annual cost-of-living adjustments (COLA).
• Merit increases: Criteria and process for awarding merit base salary increases in addition to COLA adjustments.
• Executive incentive program: Design of a performance-based incentive tied to annual goals and achievement of strategic plan milestones and provides a financial reward that does not increase base salary.
• Board and CEO goal alignment: Requirement that annual goals and milestones be agreed upon jointly by the Board and the CEO.
• Transparency and reporting: Compliance with California’s public-sector compensation requirements, including Brown Act approval of CEO pay in open session, reporting to the State Controller, and severance limits under Government Code.
• Other best practices that may be recommended by the chosen consultant

13.     The Scope of Work, section 3, lists benefits as being in scope of the review. However, the response to Q&A question #1 uploaded on 9/16 seems to imply that benefits are out of scope – or should we interpret that response as saying that benefits are in scope of the current state assessment but not in scope of any future design changes?

The RFP references the CEO's medical and retirement benefits to ensure the consultant’s current state assessment provides a complete view of the District’s total CEO compensation package.

• In scope: Present medical and retirement benefits should be documented and evaluated as part of the total compensation analysis.
• Out of scope: The District is not requesting that the consultant design or implement new benefit programs or propose structural benefit changes.

That said, the District welcomes observations or recommendations about how the current benefit offerings compare to those of peer organizations. Any such recommendations should be presented as contextual insights, not as part of the formal compensation valuation used in the survey or benchmarking analysis.

14.      Is there a budget already set for the annual work that can be shared?

(See answer to Question #9)

15.      Will the MSA be negotiated by the selected consultant, or should we submit our MSA / Engagement Letter as part of our response?

The District’s Professional Services contract (attached) will serve as the base agreement, with refinements to be negotiated with the selected consultant.