|
|
|||
|
|
|
The Campus Accountability Project responds to CU President Benson about CU's exploding salaries
April 1, 2009 Opinion Editorial Bruce BensonPresident University of Colorado 1800 Grant Street, Suite 800 Denver, Colorado 80203 March 31, 2009 Dear President Benson, Thank you for taking the time to pen a response column to mine concerning where and whether the University of Colorado should cut six-figure executive compensation, including bonuses, during these tough economic times. In your response, you specifically took issue with several of my conclusions. Below, I have responded to each one of your concerns, and would like to reiterate my sincere hope that we can work together to responsibly prevent CU students from shouldering the burden of spending growth through yet another tuition increase. To most effectively achieve this goal, the Independence Institute reiterates its support for responsibly cutting CU’s six-figure taxpayer-funded salaries and bonuses. Total taxpayer commitment to CU: Thank you for your correction concerning CU’s total budget of $2.4 billion. Based on a researching error, we had listed the figure incorrectly. I still believe, however, that you are missing the larger point, which concerns wasteful spending of taxpayer funds at the university. Moving on to other concerns expressed in your column, you also readily dismissed my conclusion of CU’s total taxpayer commitment of nearly $1 billion, incorrectly claiming I was off by $682 million. While according to your analysis, CU’s “taxpayer compensation (state appropriation) this year was $209 million (plus $18 million from the state's tobacco settlement dedicated to health sciences programs, $70 million in capital construction money and about $21 million in financial aid (which passes through directly to our students), for a total of $318 million, not one billion,” it is very clear that taxpayer compensation is far from limited to these specific funding pools. When CU’s federal taxpayer investment is also calculated, conservative estimates on direct taxpayer investment swell to nearly a $1 billion annually, a figure consistent with what I included in my column. According to CU’s office of contracts and grants, “Historically, federal government agencies have been the source of approximately 90% of UCB's sponsored project funds,” (source: http://www.colorado.edu/ocg/funding.html), and according to a 2007 university press release, “CU is a premier teaching and research university, ranked sixth among public institutions in federal research expenditures by the National Science Foundation.” The release also concludes that “The University of Colorado continued to be a national leader in research funding by attracting some $637 million in fiscal year 2007, led by a nearly $10 million increase at the University of Colorado at Boulder (FY 06 - $256 million to FY 07- $266 million).” (source: https://www.cu.edu/news/releases/Strong_Pace_Research_08-30-2007.htm). These figures do not include 2008 total grant distribution, nor do they include grant funding through this year’s federal stimulus package. (source: http://innovation.colorado.edu/arra/index.html). While these federal dollars may not show up as “state appropriated,” they still reflect the significant taxpayer investment that I discussed in my column. We stand behind our conservative estimate that taxpayers, both at the federal and state levels, will spend nearly $1 billion to fund CU in this fiscal year. CU’s total workforce and the need for greater transparency Next, if university public records are correct, your suggestion that my column misstated the total number of people employed by CU is incorrect. First, you concede that more than 2,000 of CU’s 14,901 employees (a figure that is 99 lower than the figure you used in your column) are paid six figures annually, but then you say there are more than 24,000 CU employees total to serve CU’s 54,000 students. If this is true, why is it that CU’s own public salary database, which purports to include both full-time and part-time employees reflects only the 14,901 employee figure? (source: https://www.cusys.edu/budget/cusalaries/). Next, your analysis concludes that just 5.4 percent (815) of CU’s 14,901 employees are funded through state appropriation. While this may be true (we cannot verify this fact because we do not have access to the 10,000 salaries not listed on CU’s public database), state appropriation is not the only taxpayer-funding available for these positions. As discussed above, federal taxpayer funds provide considerable financial support for CU. The ultimate taxpayer commitment remains substantial. In addition, it is extremely troubling that CU’s public database only provides base salary information and does not include total taxpayer investment, including performance bonuses, car, or housing allowance, funding of health or life insurance, or any other fringe benefits. According to CU’s own analysis (source: http://www.colorado.edu/ocg/freq.html), fringe benefit rates for staff range from 17 percent for temporary classified staff to 27.7 percent for professional full-time staff. With 1,282 employees earning between $80,000 and $100,000 in base salary alone, it’s clear that more than 3,000 of the 14,901 employees listed in the database earn over $100,000 annually. As an example of the incomplete picture painted by the database, UC Denver Chancellor Roy Wilson’s salary is listed at $468,115, but the figure does not include the hundreds of thousands he receives in additional compensation. In 2009, Wilson will earn more than $700,000 after performance pay and additional compensation is calculated (see below). In addition to a lack of transparency surrounding taxpayer-funded compensation on CU’s public database, several links on the CU budget and planning Web site connect users to outdated or incorrect links. (source: https://www.cu.edu/budget/budget-finances.html) . An example: while budgets for 2001, 2002, and 2003 are referenced, no links to such information are provided. Links for other specific budget years incorrectly lead users to attendance information for previous years. Students foot the bill for tuition increases amidst substantial salary increases Over the last several years, CU students have seen their tuition rise substantially. During this same period, however, CU’s three chancellor positions have all been granted substantial compensation increases. Most recently, during the 2008-2009 school year, tuition rates for resident undergraduate students at CU went up by an average of 9.3 percent at CU-Boulder, 8.5 percent at UC Denver’s downtown campus and by 7.5 percent at UCCS. The increases followed 2007-2008 increases ranging from 7 percent at CU-Colorado Springs and 14.6 at CU-Boulder. (source: https://www.cu.edu/content/cu-board-regents-approve-tuition-increases-fy-200809). At Colorado Springs, Chancellor Pamela Shockley-Zalabak has a 2008-2009 salary of $261,876, in addition to $35,000 in supplemental pay. This figure is up $85,000 from FY 2005-06, when she was paid $203,320, with $7,200 in supplemental pay. The Boulder campus also saw a substantial jump in chancellor compensation during this same time period. While interim Boulder Chancellor Phil DiStefano was paid $238,495 with supplemental compensation of $7,200 three years ago, current (and outgoing) Chancellor G.P. “Bud” Peterson received $363,478, in addition to $10,000 in supplemental compensation this year, reflecting a three-year compensation increase for the position of more than $128,000. At UC Denver, the three-year change was most staggering. Former Chancellor James Shore was paid $396,000 in 2005-2006, in addition to $7,200 in supplemental pay. By 2008-2009, however, current Chancellor M. Roy Wilson commanded a base salary of $468,115, in addition to $252,500 in supplemental pay, reflecting an increase of more than $314,000 in annual compensation. When calculating just the compensation increases for each of these three positions, taxpayers have seen their tab rise more than $527,000 every year solely to fund these positions. “Peer Average” Analysis Concerning national peer averages, you articulate one of the biggest problems we face in attempting to achieve fiscal responsibility in higher education. Over the last decade, while college students across the nation have faced ballooning tuition bills, executive and administrative salaries have skyrocketed. CU’s “peer institutions” are not the model for fiscal responsibility that CU should turn to. As a February Business Week report articulates, university presidents have seen their compensation “rising steeply over the past 15 years, especially compared to professors' incomes. One-third of presidents at public universities now earn more than $500,000 a year.” And as the report wisely concludes, “Given an economic climate in which tuition is outpacing inflation, endowments are plummeting, and colleges are pleading for more government aid, the public may sour on seven-figure compensation for university presidents.” (source:http://www.businessweek.com/bwdaily/dnflash/content/feb2009/db20090216_614557.htm?chan=top+news_top+news+index+-+temp_news+%2B+analysis). While CU may rank below executive compensation levels of some of its “peer institutions,” it cannot escape culpability for the fact that its salaries are rising annually at the expense of Colorado’s working families. While you wrote that “CU commits more than $80 million in internally generated financial aid to ensure access to low-income Coloradans,” this commitment should be considered an insufficient consolation to those Colorado families struggling to keep up with the substantial tuition increases referenced above. CU’s response to the Independence Institute In your column you reference my request for CU to consider implementation of salary cuts and freezes for CU’s most highly paid employees. We can debate semantics, but the fact of the matter is that a response to the actual policy recommendation has not yet been given. While it’s true that you sent me two short emails, which I appreciated, acknowledging receipt of the Independence Institute’s letter, and saying CU would wait to make any decisions until after more is known about the Long Bill, you did not respond to the substance of our request—which is that CU seriously consider salary cuts as a way to avoid more tuition increases. Leadership examples provided by other universities Finally, you wrote in your column that implementing the salary cuts we’ve advocated would constitute a “knee jerk reaction.” Nothing could be further from the truth. Real courage requires that CU cut excessive executive compensation as an alternative to automatically spending whatever the legislature shells out to the institution in any particular year. I would encourage you to look to the leadership of other institutions to see that executive salary cuts constitute a prudent first step during tough economic times. Other university leaders, including University of Connecticut President Michael J. Hogan , are forgoing bonuses or other executive compensation this year. According to a recent Chronicle of Higher Education report, Hogan recently waived what would most likely have been a $100,000 bonus. In addition, according to the Chronicle, several other university leaders, including those at Rutgers, Rowan, and the University of Louisville, have made similar commitments. Closer to home, at least one vice president at Colorado State University has agreed to accept a compensation cut as a way to help head off further tuition increases. (sources: http://chronicle.com/weekly/v55/i13/13b00601.htm and http://www.coloradoan.com/article/20090312/CSUZONE01/303120017/1110 ). In addition, in California, Lieutenant Governor John Garamendi recently suggested that in the aftermath of a San Francisco Chronicle report detailing excessive university executive compensation there, the California State University system may need to freeze CSU executive pay raises and hiring to repair its credibility: "We need a better image to gain the public's trust. Unless we get the public's support, we won't get the funding we need," he told reporters. (sources: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/11/19/BAJ7147DGN.DTL and http://www.unit9news.org/2008/11/csueu-president-pat-gantt-calls-csu.html). The source of outrage there: vice presidents at some Cal State campuses were making up to $225,000—lower than compensation provided to multiple vice presidents within the CU system. (source: http://www.denverpost.com/higheredpay_cu). Finding common ground Ultimately, President Benson, I believe we can find common ground. As you wrote, “Wherever the cuts end up, our guiding principle is to protect our academic and research enterprises, quality and access.” CU can most quickly and effectively achieve this goal by cutting excessive executive and administrative spending that has little impact on the classroom. In 2008, you conceded to Rocky Mountain News reporter Myung Oak Kim that at CU, “We are balancing the budget on our students, and it would be nice if we didn't have to do that.” (source: http://www.rockymountainnews.com/news/2008/apr/22/regents-ok-tuition-hike-of-93-for-cu-boulder/). The fact is that you don’t. As I have presented throughout this letter, a viable alternative, at least in part, clearly exists. I sincerely look forward to working with you in the near future to make CU the leanest and most effective institution it can be. Sincerely, Jessica Peck Corry Director Campus Accountability Project |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
  |
| home
| about us
| publications
| events
| contribute
| multimedia
| rss feeds
| policy centers
| © Copyright Independence Institute 2010. All Rights Reserved. 13952 Denver West Pkwy. Suite 400 Golden, CO 80401 | (303)279-6536 |
 |
Send this Article to a Friend
Printable page
