Pay for university leaders drives 'academic arms race'
By Debra Erdley
Published: Monday, May 21, 2012, 10:55 a.m.
A survey of top-paid public university executives, which lists former Penn State University President Graham Spanier as No. 3 nationwide last year, shows competition for leaders is driving an "academic arms race," one university economist said on Monday.
Spanier, whom trustees forced to resign in November in the wake of the Jerry Sandusky child sexual abuse scandal, collected $1,068,763 in total compensation, including a $200,000 bonus and $208,761 in deferred compensation in the year ending June 30, according to the Chronicle of Higher Education survey.
Ohio University economist Richard Vedder, founder of the Center for College Affordability and Productivity, said colleges are upping the ante, and suffering as a result, as they compete for executive talent to bolster fundraising and boost graduation rates.
"There's no question there is an athletic arms race with colleges paying millions for football and basketball coaches, but there is very much of an academic arms race, too. And I think students increasingly are funding the academic arms race through higher tuition and fees," Vedder said.
According to the Chronicle survey, only two other public university presidents out of 199 surveyed broke the $1 million mark in 2011. E. Gordon Gee, president of Ohio State University, collected $1,992,221, and Michael D. McKinney collected $1,966,347 at the helm of Texas A&M University.
University of Pittsburgh Chancellor Mark Nordenberg was 40th on the list at $561,500. Ann Weaver Hart, president at Temple University, made $655,000.
Gov. Tom Corbett and others have criticized university spending and tuition increases, especially at state-related schools such as Penn State, Pitt and Temple. The state cut subsidies this year by 20 percent, and lawmakers struck a deal with university leaders to maintain funding next year if the schools limit tuition hikes.
"In these difficult economic times, leaders of colleges and universities that receive taxpayer dollars -- and are asking for even more tax dollars -- should set an example by finding ways to reduce their spending," said Corbett spokesman Kevin Harley.
At Pitt, Nordenberg requested that the school's compensation committee freeze his compensation next year. Penn State President Rodney Erickson, the school's former provost, agreed to a base salary of $515,000 a year through 2014 when he replaced Spanier. His contract stipulates that trustees may increase his compensation but not reduce it.
Spanier, who remains a tenured professor at Penn State, is on a yearlong transitional sabbatical. He recently confirmed he is working in Washington on a national security project.
Officials at the Pennsylvania State System of Higher Education, which oversees 14 state-owned universities including Indiana, California and Slippery Rock, say they are suffering as they struggle to deal with shrinking state subsidies and a presidential pay scale with which they can't keep pace.
"Our presidential salaries are below the median for similar institutions. And if you look, you'll see we've had a lot of turnover in recent years. A lot of them have gone to smaller institutions for significantly more money," state system spokesman Kenn Marshall said.
Marshall said system Chancellor John C. Cavanaugh is collecting the same salary he did when he was hired in 2008 to oversee the 14 state-owned universities: $327,500.
But the schools are being forced to offer plumper paychecks to attract and keep talent.
Indiana was the only other Pennsylvania university included in the Chronicle's survey of public research universities. The largest of the 14 schools, IUP paid its president, David J. Werner, $253,000 last year. When IUP's new president, Mike Driscoll, takes over in July, he will earn $275,000, Marshall said.
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