Because they are broke and owe a lot of money. Cutting salaries and overhead is how private entities take care of things like the bankruptcy. Cutting those salaries in half would not send those folks to the poor house. Maybe if they did that years ago along with a lot more cut backs, they could have avoided the whole mess.
The problem here is that this operation is in California. They all have house mortgages which are beyond imagination. If you start to cut more than ten percent of their salary....they will likely start to have various problems (with the bank, the property taxes, the state income taxes, etc).
I would also note that the typical police Lt in LA or SF often makes at least $120k, and there are senior city/county clerks in the state of California who make $200k. So these guys are making what would be a typical average California salary...if you ask me.
Your right , just the Schullers alone are pulling almost 400 k a year out of there.