SACRAMENTO — The head of the state's troubled housing loan agency is stepping down amid a controversy over a 27% pay raise that will sweeten her retirement income by thousands of dollars a year.
Theresa Parker leaves office a little more than a year after a decision to raise her pay -- now $175,000 -- prompted an internal investigation, complaints from Gov. Arnold Schwarzenegger's chief of personnel and the resignation of one of her agency's board members.
The controversy surrounding her Dec. 13 departure from the California Housing Finance Agency, a provider of home loans for the poor, adds to turmoil created by a worldwide financial crisis that has led to a quadrupling of foreclosures on the agency's loans.
"This is not the time to be giving big raises and pensions, especially for an agency that finances home loans," said state Sen. Alan Lowenthal (D-Long Beach), chairman of the Senate Committee on Transportation and Housing.
Parker, citing the board-ordered internal investigation as vindication because it found that no laws were broken, said she planned to retire when her term ends in December but the decision is not related to the pay-raise flap.
"They found nothing inappropriate with it," she said of the investigation.
"My integrity is very important to me."
The internal investigation found that pay raises for Parker and other agency executives -- including 43% increases, from $118,300 to $170,000, for two other managers -- were pushed by then-board chairman John Courson at the same time the agency was doing millions of dollars in business with his home-loan company.
The investigative report, by an outside law firm, said a perception of wrongdoing may be created if the executives and board members who do business with the agency play any role in setting the pay of the agency's top managers.
The report recommended that the compensation process be changed so the executive director is not involved and board members who do business with CalHFA do not participate, "to avoid even the appearance of impropriety."
Parker, the investigation found, "had direct involvement in certain aspects of the process" for raising her salary, including a role in initiating and designing the survey of comparable positions that was used by a compensation committee to justify an increase of 45%, from $138,000 to $200,000.
"My role was appropriate," Parker said.
