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Fresno City Councilmembers are calling on state elected officials to audit and investigate reports of seven-figure compensation for Valley Children’s Hospital CEO Todd Suntrapak. Photo by Ben Hensley
Written by Ben Hensley
At a press conference Wednesday morning, Fresno City Councilmembers Garry Bredefeld and Miguel Arias called for audits and investigations into the pay of Valley Children’s Hospital CEO Todd Suntrapak.
They called into question Suntrapak’s reported $5.1 million in earnings for 2021, as well as four other executive-level employees who made in excess of $1 million in 2022.
Arias said he would request the Joint Legislative Audit Committee and Assemblymember Jim Patterson to launch an audit of the expenditures of Valley Children’s Hospital.
“Assemblymember Patterson has secured audits for concealed weapons permits and sexual harassment claims at the CSU system,” Arias said. “It is pertinent and urgent that he also step forward and secure an audit by the Joint Legislative Audit Committee of the Assembly and the Senate of the use of MediCal funds by Valley Children’s Hospital and whether they’re going to be allowed to continue using hospital proceeds to pursue their profiteering agenda including the development of a commercial retail mall.”
Patterson, however, issued a news release Wednesday afternoon clarifying that any audit would only be able to focus on state programs and funding received by the hospital.
“Despite calls to audit Valley Children’s Hospital, the state has no authority to demand information on the executive salary and compensation of a private, nonprofit,” Patterson said in the news release.
Bredefeld also called on California Attorney General Rob Bonta’s office to investigate how Valley Children’s Hospital spends its state allocated funds, and whether or not there has been any abuse of these funds.
The duo also questioned why Valley Children’s Hospital board trustees, including Fresno District Attorney Lisa Smittcamp, would approve a compensation package that exceeds that of all but two children’s hospitals nationwide.
“I wanted her to do the job that I wanted all of those board of trustees to do,” Bredefeld said. “As an elected official she had an even more important role because she understands taxpayer dollars and they need to have an oversight for that.”
Arias drew parallels between Smittcamp’s investigation of a $10,000 loan issued to Granite Park and questioned why something comparatively smaller would take precedence over “one of the biggest excessive pay salary scandals that we’ve ever seen in our city’s history.”
A request for a comment from Smittcamp’s office had not been returned as of Wednesday afternoon.
During the press conference, both Bredefeld and Arias also questioned why Valley Children’s Hospital continued to host fundraisers like Kids Day under the guise of raising much needed funds while at the same time paying a seven-figure salary to multiple executives along with Suntrapak.
The pair also highlighted the optics of a children’s health care network which sees a large portion of its patients paying for service through MediCal simultaneously paying such large salaries to its executive-suite employees, with Arias adding that the hospital actively seeks to reclaim funds from patients by sending them to collection agencies.
“The truth is those who are responsible for our health care system have prioritized corporate profits – their personal pocketbooks – instead of serving those they were established to serve,” Arias said, adding that through the revelations of the hospital’s tax returns, the hospital has proven its prioritization of profit over patient care.
AMF Media Group CEO Vintage Foster said Tuesday in an interview on KMJ’s Broeske & Musson that the increase in apparent earnings is a result of two things — a consolidation of performance-based bonuses given to Suntrapak (which included the lump sum of bonuses issued in both 2021 and 2022) and the continued success of the hospital, which has seen exponential financial growth since Suntrapak took over as CEO in 2012.
Bonuses paid out on the 2021 IRS 990 form revealed higher performance-based bonuses than in years prior.
“What happened for Todd, and all of the executives in this one year, is they got paid out two bonuses in one year,” Foster said. “The accounting firm made a recommendation to Valley Children’s that they should change the time period for which they award a bonus to the executive team…What happened for Todd, and all of the executives in this one year, is they got paid out two bonuses in one year.”
On Wednesday, Bredefeld questioned whether or not those funds had anything to do with Covid-19 relief funding provided to hospitals during the pandemic.
As of Wednesday afternoon, The Business Journal has yet to receive a response from either Valley Children’s Hospital and AMF Media Group regarding whether or not Covid-19 assistance funds were used for executive compensation.
During Suntrapak’s time as CEO at Valley Children’s Hospital, his compensation package has increased annually, starting on par with his predecessor, Gordon Alexander, at around $800,000 annually.
Since taking over as CEO in 2012, Suntrapak has overseen a more than 200% increase in annual revenue, jumping from more than $540 million in 2012 to more than $1.1 billion in 2022.
Along with those numbers, however, the tax filings also reveal a jump in expenses for executive compensation from 1.4% in 2012 to 2.6% in 2022, with other salaries and wages – including hospital workforce employees – dropping from 37.7% of total expenses to 28.9% in 2022.
Arias called for transparency from the hospital and called on the Board of Trustees to hold the hospital accountable for its expenditures and the optics that come with fundraising for a nonprofit hospital while at the same time compensating its executive-level employees with seven-figure packages.
“These are not ceremonial positions,” Arias said. “You have a fiduciary duty to provide oversight of a taxpayer-funded organization that is legally a nonprofit organization. Too often these board of directors are appointed because they are ‘yes people’ and they want to attend a fancy fundraiser once a year.”