WEDNESDAY, JUNE 19, 2002
THE UNIVERSITY DAILY KANSAN = 21
Enron discloses senior salaries
The Associated Press
NEW YORK — In a disclosure that outraged former employees, Enron Corp. reported that its 144 senior managers were paid $744 million in the year before the energy company's collapse, including more than $150 million for former chairman Kenneth Lay.
Enron outlined the compensation in a filing late Monday with federal bankruptcy court in New York — documents that provide a glimpse into the company's finances as it spiraled into the biggest bankruptcy in the nation's history.
The large sums of payments and stock paid to the managers do not indicate any wrongdoing. Former employees could try to recover some of the money if they show preferential payments were made before the bankruptcy, obstructing creditors from getting their fair share.
Representatives of former workers and shareholders responded angrily after the disclosure, accusing Enron's senior managers of essentially raiding the company's coffers while leaving clients with a pittance.
“It's outrageous. My clients find it outrageous and it's just more evidence that people at the top knew that they better get while the getting was good,” said Eli Gottesdiener, an attorney representing 24,000 participants in Enron retirement plans who lost as much as $1 billion as the company's stock slid.
Enron disclosed in the 1,436-page filing that top employees received $309.5 million in salary, bonuses, long-term incentives, loan advances and other payments. They also exercised stock options and received stock valued at $434.5 million.
Lay received $152.7 million in payments in stock — more than 11,000 times the maximum amount the company's laidoff workers will likely get in severance.
Lay, one of the many top executives who has been criticized and scrutinized since Enron's rapid collapse, received $81.5 million in loan advances, among other payments, and $34.3 million in stock options.
Other executives who shared in the pay and awards were former chief executive Jeffrey Skilling and former chief financial officer Andrew Fastow, whose names have also been closely tied to the scandal. Skilling received about $35 million.
The more than 4,500 people who lost their jobs when Enron filed for bankruptcy have received a combined $43 million in severance and a tentative agreement has been reached whereby they would get an additional $30 million or so.
Individual employees would get no more than $13,500 in total severance, minus any payments they have already received, based on their salary and length of employment.
About a dozen lawsuits have been consolidated into a single class-action case asserting that Enron violated federal pension rules.
Enron filed for Chapter 11 bankruptcy protection on Dec.2, four days after its proposed merger with crosstown rival Dynegy Inc. fell apart.
Air tanker crashes while battling wildfire
The Associated Press
Firefighters faced more hot, windy weather on Tuesday, following a tumultuous day in which an air tanker lost its wings and crashed in flames while battling a wildfire in Northern California.
Within hours of the crash, flames engulfed crews trying to corral a blaze in Southern California's Cajon Pass, 50 miles east of Los Angeles, injuring three firefighters and shutting down a major highway.
The Northern California fire, in the
The accidents, which came as crews battled 20 large blazes in 11 states, could signal that the fire season in the West will be particularly dangerous.
"These things happening in the middle of June do not bode well for the remainder of the year," said Bill Peters, spokesman for the California Department of Forestry's San Bernardino unit.
The fire deaths and injuries came on the same day that a U.S. Forest Service worker in Colorado appeared in court on charges alleging she started state's biggest fire while burning a letter from her estranged husband. If convicted, Terry Barton could face a total of 20 years in prison and a $250,000 fine.
Sierra Nevada near Yosemite National Park, destroyed at least one home and forced 400 people to evacuate as it consumed some 10,000 acres of brush and forest near the small mountain resort town of Walker.
The C-130 tanker had just made a pass over the fire when it crashed Monday. TV news video showed the aircraft's wings snapping off and flames erupting as the fuselage spiraled to the ground, crashing in a giant ball of fire.
"I'm standing here looking at the tail section," Mike Mandichak, who owns an auto shop 150 feet from the crash site, said by telephone. "My shop is right next door. It almost hit it."
The Interagency Incident Management Team said the plane was under contract to the government from Hawkins & Powers Aviation Inc. of Greybull, Wyo.
Hours later in Southern California, three firefighters suffered first- and second-degree burns to their hands, elbows and noses when flames engulfed their two trucks. One of the firefighters deployed an emergency shelter as the heat peeled the paint off the fire engines, which were parked on a highway. They were listed in good condition at Arrowhead Regional Hospital, said Peters.