Treasury Secretary John W. Snow left CSX Corp. last month with $68.9 million in deferred compensation and other pay, including a pension that some advisers to corporate boards said was unusually large.
The Richmond-based railroad gave Snow a $33.2 million lump sum in lieu of future pension payments of about $2.9 million a year, according to a report it filed yesterday with the Securities and Exchange Commission.
At that rate, Snow, 63, would have received more per year in retirement than the $2.1 million of salary and bonus he was paid last year while he was still on the job.
"That doesn't happen very often," said Brian Foley, who advises big corporations on executive pay matters. Snow's compensation at CSX "didn't seem to me to jibe with somebody who's a reformer."
In addition to the pension, Snow received $8.1 million in cash in lieu of a $25 million life insurance policy provided under his employment contract, $8.7 million in deferred compensation and $18.9 million in stock that he had accrued but not yet received.
CSX spokesman Adam Hollingsworth said, "John Snow's pension and related benefits are consistent with executives of other Fortune 500 companies."
A Treasury Department spokesman declined to comment.
Typically, annual pension payments to retired executives are 40 to 65 percent of what they earned during their peak years, some compensation consultants said.
In computing Snow's pension, CSX credited him with 44 years of service at the railroad company, although he worked there for about 25 years. "Adding additional years of service for purposes of pension calculations is a common practice in executive compensation across Fortune 500 companies," Hollingsworth said.
The railroad based Snow's pension on his average pay over the past five years, which the company said was $4.4 million. According to a proxy report filed with the SEC yesterday, that average included 250,000 shares of restricted stock that Snow was granted in 1999.
CSX's compensation committee accelerated the vesting of the restricted stock in 2002 based on the company's achievement of performance goals stated in an employment contract with Snow, the CSX report said.
Company spokesmen said they were unable to explain in detail yesterday how the board determined that the goals had been met.
Hollingsworth said Snow's compensation "was based on criteria set by the board," and "based on their analysis of the criteria set he was compensated accordingly."
Snow relinquished claim to about $18 million in severance pay and perquisites under an employment contract negotiated in 2001, a CSX spokesman said. The contract specifically addressed what could happen if Snow left CSX for public office.
But, based on the contract, it appears that Snow was not automatically entitled to those benefits. First, the compensation board would have to determine that Snow was assuming a role "benefiting the company and its mission," the contract said.