Harkening back to a centerpiece of his initial mayoral campaign, San Jose Mayor Matt Mahan has unveiled a “pay-for-performance” proposal that will ask voters to support tying future merit raises for councilmembers and the upper rung of city administration to metrics.
Mahan hopes to place a measure on next year’s ballot that would set clear priorities and targets for the city’s future budgeting, saying it will increase accountability for local government that could help drive efficiency.
“I believe the government can be better, and we can be dramatically more focused, more efficient, and more pragmatic in delivering the outcomes the community cares about,” Mahan told Bay Area News Group. “This kind of model of the dashboards we’ve created with explicit goals and performance measures plus a tie to pay raises makes the feedback loops explicit and makes the accountability real, and that’s what I’m trying to achieve.”
San Jose currently operates what is known as a council-manager form of local government, where elected officials set the policy direction and ask the city manager to oversee the day-to-day operations and execute their vision.
Mahan said that the ballot initiative is not trying to change that dynamic, but rather to give elected officials and department heads clear priorities and targets they must achieve to merit an additional bump in pay. Ultimately, it is those senior administrators, who make prioritization and resource allocation decisions, who are responsible for delivering successful outcomes.
The proposal will not impact base salaries, cost-of-living adjustments or any employees below the senior level of management. Generally speaking, Mahan said the base pay of the senior leaders affected make $200,000-$300,000 per year, with the exception of City Manager Jennifer Maguire, who had a base pay of nearly $430,000 in 2024, according to city data.
In November, the City Council unanimously voted to give merit raises to the employees it directly appoints — Maguire, City Attorney Nora Frimann, City Auditor Joe Rois and City Clerk Toni Taber.
Maguire, Frimann, and Rois received 2.5% merit raises, while Taber received 1%.
Mahan’s latest proposal requires going to the ballot box because the voter-approved salary-setting commission determines the council’s pay. If the proposal receives approval to appear on the ballot and is passed, the earliest it would go into effect is 2027.
While Mahan campaigned on this idea — citing many residents’ beliefs that the city is not a good steward of public resources and is not open and transparent — he said it could not be implemented immediately during his first term in office because it required building a foundation.
The City Council ultimately established four main priorities: reducing unsheltered homelessness, increasing community safety, cleaning up neighborhoods and attracting investments in jobs and housing.
Then in late 2023, the city unveiled beta versions of several dashboards to track the city’s progress on the determined focus areas.
He said the target goals set out in these “scorecards” could be the type of criteria used to evaluate performance, though that will be up to City Council debate. If homelessness is identified as a focus area, Mahan said he imagined it could be measured by building a certain number of interim housing solutions or setting a specific reduction target for the unhoused population.
“I want to make the government more accessible and transparent again, and create a tighter feedback loop between the residents and their priorities,” Mahan said. “We’re responsible for translating the community’s priorities into budgeted programs and policies, and I’d like that conversation to revolve less around our opinions, or our ideology or virtue signaling, and to be much more centered on a rational debate about what will measurably move the needle on things like unsheltered homelessness and public safety.”
Mahan said that each year, he would like the City Council to identify three-to-five goals based on community input that would be the basis for performance evaluations. He envisioned that merit raises would be based on a scale, not an all-or-nothing target.
He likened the approach to performance evaluations in the private sector, which he noted do not have the type of job security as in government.
“The government can easily get 10, 20, 30% better, yet we don’t see major productivity gains in the way that we do with so many other sectors of our economy,” Mahan said. “I think it’s time that we push ourselves to get better and get more efficient year-over-year.”