On Campuses, the Income Gap Widens at the Top

The economic divide is not confined to Wall Street and Main Street.

Within the world of private higher education, there are a handful of college presidents who earn considerably more than professors on their campuses, or gobble up a notable share of their institutions’ budgetary pie, a Chronicle analysis has found. There are also significant pay gaps among presidents, 36 of whom earned more than $1-million in 2009.

A typical private-college leader made 3.7 times as much as the average full professor on his or her campus in 2009, but six presidents reviewed by The Chronicle made more than 10 times as much as their faculty colleagues, according to national faculty-salary data and the most-recent available federal-tax filings. While most colleges spent less than $5 on presidential pay for every $1,000 of their budgets, 14 of the institutions The Chronicle reviewed spent two times that.

The question of how much is too much money for a college leader has particular resonance at a time when the national conversation is increasingly focused on the haves and the have-nots. Looking at what college leaders earn relative to their faculty counterparts and the size of their campus budgets, as The Chronicle has for the first time in this year’s survey, helps identify outliers whose take-home pay appears disproportionately high.

Included in The Chronicle’s overall analysis are 519 private-college presidents whose institutional budgets exceed $50-million. Among that cohort, the median total compensation was $385,909 for 2009, a 2.2-percent increase over 2008.

Struggling College, Well-Paid Chief

This year’s highest-paid presidents include many of the usual suspects, such as the leaders of Ivy League institutions and other colleges with large endowments. But the million-dollar club also includes the presidents of a number of colleges with lesser national name recognition. Among them is the president of Mountain State University, a college based in West Virginia that has not been featured in previous Chronicle surveys because its budget fell below $50-million until this year.

Charles H. Polk, who earned $1.8-million as Mountain State’s president in 2009, ranked sixth on this year’s compensation list, ahead of the presidents of such places as Rensselaer Polytechnic Institute, Swarthmore College, and Yale University. Mr. Polk’s pay constituted 3.5 percent of Mountain State’s budget. No other college in the survey devoted such a substantial share of its resources to a president.

Mr. Polk breaks into the rankings of the nation’s highest-paid presidents at a time when Mountain State is fighting to retain its regional accreditation with the Higher Learning Commission of the North Central Association of Colleges and Schools. In June, the commission placed Mountain State on “show cause” status, which is the final step before removal of accreditation. The college’s nursing program also lost accreditation recently.

Mountain State’s six-year graduation rate of 2.5 percent for bachelor’s degree-seeking students also is extremely low when assessed by federal standards. Given the university’s significant numbers of transfer and adult students, however, the federal calculation captured only 5 percent of the college’s fall enrollment in 2003. Colleges with similar demographics frequently dismiss the federal measure as inadequate for assessing performance, and the low rate does not appear to have affected the board’s support for Mr. Polk.

“The board has been very satisfied with the growth and development of the institution,” said Jerry Ice, the board’s chair.

Mr. Polk declined multiple interview requests made through his office.

Of the $1.8-million Mr. Polk received in 2009, about $1-million came from a one-time payout of a fully vested retirement package, Mr. Ice said. Even in prior years, however, Mr. Polk would be among the nation’s highest-paid presidents relative to budget, tax forms show.

The Chronicle’s analysis of compensation compared with college budgets included 401 presidents. The cohort excludes presidents who served for less than a year and those with no reported base salaries, who are mostly from colleges with religious affiliations.

Most presidents who took home a small percentage of their college’s budgets were hardly profiles in frugality, but rather happened to lead the nation’s wealthiest institutions. The $1.5-million provided to Lee C. Bollinger in 2009 was less than a smidgen of Columbia University’s $3.4-billion budget, but Mr. Bollinger was still the nation’s twelfth-highest-paid private-college president in that year.

When defending their presidents’ compensation, college officials often suggest that their chief executives have passed on far more lucrative careers in the corporate world. They also note that major research universities, and even small liberal-arts colleges with increasingly global reach, are highly complex organizations that require a particularly strong skill set to run.

One university official put his executive’s pay in a different context, raising a question about societal values. When asked recently about the $1.2-million the president of Wilmington University, Jack P. Varsalona, collected in 2009, a spokesman compared the president’s compensation to that of a professional athlete’s. Thomas B. Cupples, assistant vice president of institutional advancement at Wilmington, argued that Mr. Varsalona’s pay, which ranked 32nd among private-college presidents, was a pittance when compared to that of Michael Vick, the NFL quarterback in nearby Philadelphia.

“I don’t think in a city where they pay a guy $21-million because he can throw a football straight, that we’re going to get all upset about a person who has enhanced the region,” Mr. Cupples said.

Income Inequality

The number of college presidents earning at least one million dollars is increasing—there are three more this year than last—at a time when income inequality is stirring protests across the United States, and college campuses have emerged as key battlegrounds for offshoots of the Occupy Wall Street movement. As more Americans lament the widening income gap between the nation’s wealthiest individuals and a shrinking middle class, it is of little surprise that college presidents at the top of the pay pyramid have also been targeted by students who face spiraling tuition costs.

Amy Gutmann, president of the University of Pennsylvania, has come under fire from members of OccupyPenn, a student incarnation of the Wall Street protest. In a letter published last month in The Daily Pennsylvanian, the university’s student newspaper, a student affiliated with the group called Ms. Gutmann’s $1.3-million earnings for 2009 a “disgrace” to lesser-paid workers on the campus. While some students quoted by the paper defended Ms. Gutmann’s pay, noting her substantial responsibilities and fund-raising prowess, Meg Hlousek’s letter has become part of the rallying cry for student protesters, the newspaper reported.

Comparing presidents’ salaries with those of campus janitors strikes many higher-education experts as dubious, but the widening gap between presidential and professorial pay is often regarded as a symptom of inequity in academe, where the scholarly credentials of faculty frequently rival or exceed those of presidents.

In 2007 the American Association of University Professors reported that presidential pay, when adjusted for inflation, had grown by 35 percent in the preceding decade, compared with a 5-percent increase for professors during that time. That gap is troubling, said Saranna R. Thornton, chair of the AAUP’s Committee on the Economic Status of the Profession.

When college trustees allow disparities in compensation growth to persist between presidents and professors, they invite a slow decline of morale that can ultimately deter faculty from doing the often-unnoticed work of enhancing the student experience, Ms. Thornton said.

“You start to lose that kind of good will,” said Ms. Thornton, a professor of economics at Hampden-Sydney College. “You’re not going to see it on this year’s bottom line, but it can corrode an institution over time in ways that are detrimental to students.”

The Chronicle’s analysis of 319 presidents’ compensation compared with full professors’ pay excluded institutions for which the American Association of University Professors did not collect faculty salary data in 2009-10.

Stevenson University bears the distinction of the campus with the greatest income disparity between professors and their president. In 2009, Kevin J. Manning’s $1.5-million in compensation was 16.1 times the average compensation for a full professor at Stevenson, which is located just outside Baltimore.

Mr. Manning declined interview requests, but university officials provided The Chronicle with a memo distributed to board members in anticipation of the release of the compensation survey. Kevin G. Byrnes, the board’s chairman, notes in the memo that Mr. Manning’s $1.5-million compensation for 2009 includes a deferred-compensation payout of $1.1-million, which accumulated over nine years.

“I am confident that President Manning’s compensation is fair, warranted, and reflects his exemplary record of accomplishment and service to the university,” Mr. Byrnes wrote to fellow board members.

In 2008, before the deferred-compensation payout, Mr. Manning earned $623,437, which was still about seven times that of the average full professor.

The highest-ranking presidents on the pay list frequently earn their spots as a result of deferred-compensation payouts. Such was the case with J. Timothy Cloyd, whose 2009 compensation of $1.1-million at Hendrix College more than tripled his pay from the previous year. The spike is largely due to the fact that, in 2009, Mr. Cloyd collected eight years of contributions and earnings from a deferred-compensation plan valued at $738,388.

“We didn’t just decide to go pay him a million dollars for being a good president in 2009,” said David A. Knight, chair of the board of the college, which is located north of Little Rock, Ark.

An ‘Egalitarian’ Campus

On the other end of the pay spectrum is Patrick E. White, president of Wabash College. Now in his fifth year as president of the men’s college in Crawfordsville, Ind., Mr. White makes roughly two times as much as the average full professor on his campus. When he learned that no other private-college president surveyed had a smaller disparity in pay with faculty, Mr. White chuckled.

“In some ways I wouldn’t want to brag about how little I make compared to my colleagues,” he said.

In 2009, Mr. White’s total compensation was $239,207, compared with $121,500 for the average full professor on his campus.

Mr. White said Wabash is an “egalitarian” campus, where faculty are rewarded for providing students personal attention. About 35 percent of Wabash students are among the first generation of their families to attend college, and Mr. White said helping students who are not born into privilege is a key part of the institution’s mission.

“Wabash is an agent of that growth and development of men of success,” he said. “In that regard, it would probably be wrong for the president to be enormously compensated in this work.”

After a brief pause, he added, “But don’t tell my wife that.”

 

The Outliers

Leaders earning the most in 2009 compared with their budgets.
Chief executive Percent of budget Total
compensation
College expenditure

1. Charles H. Polk

Mountain State University

3.5%

$1,843,746

$52.0M

2. Frances Lucas

Millsaps College

2.4%

$1,214,112

$51.5M

3. Kevin J. Manning

Stevenson University

1.7%

$1,493,655

$86.8M

4. J. Timothy Cloyd

Hendrix College

1.6%

$1,056,255

$65.4M

4. Jack P. Varsalona

Wilmington University

1.6%

$1,157,002

$74.4M

6. Chatt G. Wright

Hawaii Pacific University

1.5%

$1,381,193

$92.5M

7. Nido R. Qubein

High Point University

1.4%

$1,390,813

$96.4M

8. Esther L. Barazzone

Chatham University

1.3%

$666,097

$52.9M

9. Joseph J. McGowan

Bellarmine University

1.2%

$639,155

$51.5M

10. Gary Brahm

Brandman University

1.0%

$688,404

$67.7M

10. George Campbell Jr.

Cooper Union

1.0%

$668,473

$65.5M

10. Gary R. Cook

Dallas Baptist University

1.0%

$834,224

$85.4M

10. Judson R. Shaver

Marymount Manhattan C.

1.0%

$598,365

$57.3M

10. Anthony S. Caprio

Western New England U.

1.0%

$1,190,638

$113.9M

Typical President (Medians)

0.4%

$385,909

$103.5M

1. Kevin J. Manning

Stevenson University

16.1

$1,493,655

$92,500

2. Frances Lucas

Millsaps College

11.8

$1,214,112

$103,100

3. Shirley Ann Jackson

Rensselaer Polytechnic Inst.

11.5

$1,771,877

$153,800

4. Jehuda Reinharz

Brandeis University

10.8

$1,536,401

$141,800

5. Nicholas S. Zeppos

Vanderbilt University

10.5

$1,890,274

$179,600

6. J. Timothy Cloyd

Hendrix College

10.1

$1,056,255

$104,200

7. David J. Sargent

Suffolk University

9.5

$1,481,787

$156,400

8. James L. Doti

Chapman University

9.4

$1,542,270

$164,600

9. Steadman Upham

University of Tulsa

9.0

$1,184,549

$131,800

10. Anthony J. Catanese

Florida Inst. of Technology

8.7

$983,349

$113,200

Typical President (Medians)

3.7

$385,909

$118,150

Omits presidents who did not serve all of 2009 or did not receive a base salary. Includes former presidents who stepped down after 2009.

Find Out How Your President Compares

Presidential and Professor Pay Scatterplot
Compare presidents’ salaries
with professor salaries and other factors.

Ranges of Executive Compensation

More Room at the Top

Thirty-six private-college presidents made $1-million or more in total compensation in 2009, and median pay rose even as inflation and median professor pay decreased.

However, like last year, most of the 519 presidents made between $200,000 and $600,000. (We surveyed private colleges with at least $50-million in expenditures). The median total compensation for private-college presidents in 2009 was $385,909, up 2.2 percent from the previous year.

Some presidents receive $0 in salary because compensation is paid to a religious order.

3 Surprising Perks of Being President

First-class travel, housing allowances, club dues, household help, and travel for spouses are all common benefits college presidents receive as part of their compensation. Here are three less-common perks that colleges provided their leaders in 2009:

Pat Robertson headshot 24-hour security coverage
Pat Robertson, chancellor and former president, Regent U.
The college provided 24-hour security coverage for Mr. Robertson because of his stature as a prominent evangelist. The college contracts with Mr. Robertson’s Christian Broadcasting Network to provide security for both him and the campus. The university’s tax form notes that Mr. Robertson receives charter air service for business and personal flights for security reasons. Full profile →

Todd S. Hutton headshot Allowance for charitable donations
Todd S. Hutton, president, Utica College
The college provided Mr. Hutton with a $6,000 discretionary spending account for contributions to charities or public causes of his choice, with a maximum of $1,000 per contribution. The college says offering the money, which it says is only part of Mr. Hutton’s personal gifts to charity, reflects the college’s charitable purpose and its expectation that the president personally participate in philanthropy. Full profile →

Paul J. LeBlanc headshot Snow removal
Paul J. LeBlanc, president, Southern New Hampshire U.
Mr. LeBlanc receives lawn care and snow removal at his off-campus house in the snowy city of Manchester—so snowy that, according to the local chamber of commerce, it gets 18 inches in January alone. When it snows, the college sends an employee to the president’s university-owned property to plow his driveway, and it makes sure that the area around his house is clean because the president entertains many visitors as part of his job. Full profile →

3 People Who Made More Than Most Presidents

College presidents aren’t always the highest-paid people at their institutions, with doctors, investment officers, and coaches frequently earning more. Here are three examples from 2009:

Charlie Weis headshot Charles J. (Charlie) Weis, football coach, U. of Notre Dame
Total compensation: $7,284,548
Mr. Weis, whose base salary was $465,489, received $6.6-million under a separation agreement that will provide annual payments through December 2015. The university fired Mr. Weis in November 2009 after his team failed to meet pre-season expectations. Mr. Weis also received $1.4-million in compensation from Play by Play Sports, an organization unrelated to the university, for his coaching duties.

James Madara headshot James L. Madara, dean of the school of medicine and chief executive of the medical center, U. of Chicago
Total compensation: $7,038,944
Mr. Madara’s base salary was $1.3-million, and he received $2.5-million in severance pay. Mr. Madara stepped down after seven years as dean and three as chief executive to return to the faculty. He resigned amid controversy over his management decisions, such as a plan to redirect medical-center patients to neighboring hospitals, according to local news reports. The university said Mr. Madara’s compensation took into account pay at peer institutions and included deferred compensation and retirement benefits accumulated throughout his tenure. Mr. Madara is now a senior adviser at Leavitt Partners and chief executive of the American Medical Association.

David Swensen headshot David F. Swensen, chief investment officer, Yale U.
Total compensation: $3,875,940
Mr. Swensen, who has been the chief investment officer since 1985, received a bonus of $3-million on top of his $781,460 base salary. Yale declined to comment on the details of Mr. Swensen’s contract or the nature of his bonus. But a spokesman for the college said his compensation is determined by the Yale Corporation, the university’s governing board, and reflects his contribution, through expert endowment management, to Yale’s ability to support research and teaching. Yale’s endowment, like that of many colleges, took a large hit in the 2009 fiscal year, with a 29-percent drop, but it increased by 2 percent in 2010.