Beasley, Allen, Crow, Methvin, Portis & Miles, P.C.

The massive coal ash spill from the Tennessee Valley Authority (TVA) coal-burning plant in Kingston, Tenn., that blanketed nearby community last year with toxic material has resulted in a 43 percent cut in pay for TVA CEO Tom Kilgore. In its year-end financial report, Kilgore was paid $1.5 million in the fiscal year that ended September 30, nearly $1 million less than what he was paid the year before.

The salary reduction was blamed partially on a drop in power sales as a result of a slumping economy. But the TVA also did away with performance bonuses for top executives, including Kilgore – a wise move considering the nation’s largest utility is facing millions in lawsuits from residents affected by last year’s coal ash spill and at least $1 billion more from a massive cleanup of the land damaged by the spill.

“It has been a very difficult year,” said TVA chairman Mike Duncan at the utility’s last board meeting.

The TVA says Kilgore took the biggest hit in salary reduction among staff at the utility, and now earns 45 percent less than the average top executive at other utilities, according to a study conducted by the TVA. Kilgore receives a base salary of $875,000 per year plus a $300,000 annual retention bonus for the next four years.

While a handful of top executives will have to forgo performance raises this year, the remaining 12,000 TVA staffers are still eligible for raises in 2010.

The TVA reported to the U.S. Securities and Exchange Commission that it earned $726 million on revenues of $11.3 billion during fiscal year 2009, compared to $817 million on revenues of $10.4 billion the previous year.

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