(Editor’s note: This story was originally published by Fresnoland, a nonprofit news organization. We reprint it with their permission.)
Two Fresno City Council members are calling on state leaders to investigate the multimillion dollar compensation packages for executives at Valley Children’s Hospital.
At a recent news conference, Council Members Garry Bredefeld and Miguel Arias called on California Attorney General Rob Bonta to investigate the nonprofit hospital’s reported $25 million in executive compensation.
In 2021, CEO Todd Suntrapak reportedly earned $5.1 million in total compensation and received a $5 million home loan “as a retention incentive in lieu of other compensation,” according to the hospital’s Form 990 tax filings.
“As a nonprofit hospital with nearly 75% of all patients being on Medi-Cal, there’s simply no justification for these outrageous and unjustifiable salaries and compensation,” Bredefeld said at a news conference at Fresno City Hall.
“The culture of enriching the CEO and his executives on the backs of sick and poor children must come to an end.”
In response to calls for a probe, Michael Hanson, who chairs the Valley Children’s Healthcare Board of Trustees, issued a brief statement.
“The Central Valley has built one of the nation’s premier children’s hospitals,” Hanson said. “In doing so, we have recruited and retained some of America’s best executives, caregivers and team members. As such, the quality of our care and the fiscal management of our organization is—and continues to be—best in class.”
The children’s hospital is consistently ranked among the best in the world.
Four executives besides Suntrapak received more than $1 million in total compensation, including the hospital’s chief financial officer, who reportedly received about $2.8 million, and three senior vice presidents, who received between $1.29 million and $1.68 million.
Eight other executives received compensation of more than $600,000, including Clovis Mayor Lynne Ashbeck, the hospital’s senior vice president for community impact. She earned more than $750,000 in total compensation during the second year of the pandemic.
A spokesperson for Ashbeck’s office did not respond to a request for comment.
Bredefeld and Arias took special issue with the hospital’s board of directors greenlighting such high executive compensation, especially since District Attorney Lisa Smittcamp is a board member.
“She should have known better,” Bredefeld said. “This is about integrity. This is about accountability. All of us as elected officials have that duty and responsibility.”
A spokesperson for Smittcamp’s office did not respond to a request for comment.
The Fresno Council members also called on Assembly Member Jim Patterson (R–Fresno) and California’s Joint Legislative Audit Committee to investigate Valley Children’s Hospital. Arias said letters were being sent to both Bonta and Patterson’s offices.
Tax Filings Show Big Money Moves
During the second year of the pandemic, Valley Children’s Hospital pulled in $354 million in profit, according to its 2021 tax filing. The document also shows $124.5 million in investments outside the United States, of which most are in Central America and the Caribbean, with the rest in European accounts.
That same year, the hospital had a total of $712 million in investments and more than $647 million in cash or savings accounts. The hospital also made $391,559 in rental income in 2021, although it’s unclear what properties the hospital is renting out to either private or commercial customers.
“Their response to this excessive pay scandal makes it clear that they have prioritized profits and awarding executives through record-billing of Medi-Cal and working families,” Arias said.
Controversy over the executives’ salaries at the Madera-based hospital comes after more than a year of efforts to reopen the community’s general acute care hospital, which closed more than a year ago due to bankruptcy. It will also soon be two years since Valley Children’s Hospital paid $10 million for the naming rights to Fresno State’s football stadium.
The two Council members also took issue with Valley Children’s Hospital seeking donations from the public in its annual Kids Day fundraiser, a collaboration between the hospital, ABC30 and the Fresno Bee. The annual fundraiser was held in the rain, with volunteers selling Kids Day newspapers along Friant Road and Audubon Drive in north Fresno.
“What we’ve learned is that Valley Children’s failed to disclose to us and everyone else volunteering that it was spending five years’ worth of Kids Day funds to buy one executive a home in Carmel,” Arias said.
The Kids Day fundraiser is known for breaking fundraising goals and records every few years. The most recent record-breaking year for donations was about $627,500 in 2017.
Last year, members of the public donated $365,740 to the hospital on Kids Day. The fundraiser also brought in $318,288 in 2022, $270,955 in 2021 and $178,000 in 2020.
“It is an absolute outrage,” Bredefeld said. “It’s a disgrace that the CEO and his executives are enriching themselves on the back of sick and poor children.”
