College presidents' pay rises
Four university presidents earned more than $800,000 in salary and benefits during the 2002 fiscal year and three grossed more than $1 million including compensation from serving on other boards, according to the most recent edition of the Chronicle of Higher Education.The presidents of Rensselaer Polytechnic Institute, Vanderbilt University, University of Pennsylvania and Rockefeller University were ranked as the four most highly paid university presidents according to statistics published in the Chronicle.
Brandeis University President Jehuda Reinharz was ranked 36th on a list of 42 research university presidents, according to data in the Chronicle, receiving $340,632 during the 2001-2002 fiscal year, a two percent salary increase from the 2000-2001 fiscal year. Additionally, Reinharz received $32,962 in fringe benefits such as health insurance, and $231,985 in allowances for housing, car, fitness, tuition for dependent children and a non-cash supplemental retirement benefit that is earned only after contract completion in 2009. When added together, during the 2002 fiscal year Reinharz received a total of $373,605 in cash and benefits.
Executive Vice President and Chief Operating Officer Peter French described the role of a university president as not only managing the daily functions of the University but also being the chief fundraiser. The ideal University President is therefore a person who can not only provide overall academic and management leadership for the University, but also fundraise effectively.
"President Reinharz has provided extraordinary leadership of the university's capital campaign," French said.
Reinharz has already raised 69 percent of the $470 million campaign goal that is scheduled for completion in 2006, according to French.
Shirley Ann Jackson, president of Rensselaer Polytechnic Institute in Troy, N.Y., received the highest compensation of any university president in the 2002 fiscal year for a total annual university compensation of $891,400. In addition to this compensation which includes $490,000 in salary and $401,400 in non-cash performance-based compensation accrued over three years, Jackson also receives $39,915 for expenses including housing and car allowances and as much as $591,000 in annual pay for membership on various corporate boards. Added together, Jackson received $1,120,915 in salary plus her non-cash performance-based incentives in the 2002 fiscal year.
Judith Rodin, president of University of Pennsylvania, the first female to serve as the president of an Ivy League institution, received $845,474 annual compensation in 2002 in addition to salaries from other boards and both cash and non-cash benefits.
In a time of economic recession and rising tuition costs, some question the extravagance of these salaries. Again according to the Chronicle, the average tuition percentage increase for first-tier ranked schools was 4.8 percent during the 2002-2003 fiscal year. Meanwhile, the median compensation for a president of a private doctoral research university rose by approximately eight percent in the 2001 to 2002 fiscal year.
Quoted in the Chronicle, Patrick M. Callan, president of the National Center for Public Policy and Higher Education in San Jose, Calif., said, "it's pretty hard to convince people that we're concerned about the rising costs of colleges, and yet we're paying these salaries."
According to information presented by the Chronicle, high salaries can be attributed in part to the will of university trustees to retain their presidents and keep them from being lured away to other jobs. Jack Connors, chairman of the Brandeis University Board of Trustees Personnel Committee, said, "it is a challenge to make sure that you are encouraging your president and making sure that you are being as fair and competitive as possible."
Connor said having a good university president is key to the institution's success. He described the job as a "combination of a show horse and a work horse...simultaneously winning the respect of the faculty, deans, alumni, students and donors."
Each institution's board of trustees reviews salaries of university presidents annually. The review includes an analysis of comparable compensation and assessment of performance.
Jackson, as the highest paid university president, landed a $360 million gift in 2001, which the Chronicle wrote "at the time was believed to have been the largest donation ever made to an individual university in the United States." Subsequently, Jackson's salary's increased by 82.6 percent from the 2000-2001 fiscal year to the 2001-2002 fiscal year.
In relation to this, Connor noted, "It is important to send a clear signal of your satisfaction" to a university president for accomplishing goals.
According to figures published in the Chronicle, pay for public university presidents has not reached the same heights as the salaries of private university presidents. However, salaries for public institutions are also on the rise with the number of public university presidents earning more than $500,000 annually doubling in the 2003-2004 fiscal year.
The Chronicle places Mary Sue Coleman, president of the University of Michigan, as the highest paid public university president. Coleman earns $677,500 in pay and benefits, plus an additional $100,000 in annual pay for membership to corporate boards, bringing her total annual compensations to $777,500.
Although the University of Michigan is a public institution, not all of Coleman's salary is paid by the state. Private groups and donors pay parts of Coleman's salary.
According to an article in the St. Petersburg Times, some states, including Florida and Ohio, are taking steps to limit the future salary level of public university presidents. Florida lawmakers are debating the introduction of a law that would limit the amount of state money paid to presidents at $225,000 annually. This cap would not affect salaries of current presidents although it would affect the salaries of future presidents. Eight of the eleven public university presidents in Florida already earn more than the proposed cap.
Ohio is also currently debating a similar law whereby the state's contribution to the salary of a public university president's salary would equal the salary of the Governor of Ohio.
Connor stated that selecting a salary level for a university president is a way of "showing you value your president vis-a-vis how much he or she can do for your university" through fundraising and leadership.
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