The University of Vermont’s Board of Trustees chose a new president and adopted a slightly revised policy on compensation for the top executive at a meeting last weekend.
The trustees have yet to announce who will replace former President Daniel Fogel who left office last summer amid a controversy around his wife’s emotional involvement with a development officer. The university was widely criticized for its generous severance and compensation package for Fogel.
In a report, reviewed on Feb. 4, board Chair Robert Cioffi said, “It goes without saying that the terms of Dr. [Daniel] Fogel’s transition have raised many issues and concerns that all of us will be cognizant of when the Board considers contractual arrangements with UVM’s next President.”
Cioffi’s report was accompanied by modest revisions of the university’s current policy. Under the heading of procedure, new wording says that the president will not be eligible to receive outside compensation without prior board authorization. A sentence was also deleted, the requirement that the president inform the board of “all compensation paid or assignable to him/her in consideration of his appointment; regardless of the source of funds.”
On Saturday, the trustees also approved a resolution authorizing Cioffi to “negotiate, finalize and execute a letter of appointment and agreement with a candidate for the presidency on the terms and conditions today reported.” In other words, the trustees have made a selection. The Annual Review Sub-Committee has a Tuesday meeting scheduled, at which discussion of contract negotiations could commence.
The trustees have also approved plans to spend $875,000 on upgrades to Englesby House, suggesting that the new president will live on campus. Fogel chose not to reside in the historic site.
Improvements to the air conditioning system and a new roof should be finished by fall. Until then, the new president, who is expected to begin work in July, will have to be housed elsewhere.
Based on equity criteria for senior UVM administrators, the president’s starting salary is likely to be around $400,000. The dean of UVM’s Medical School made $431,000 in 2010. Fogel’s top pay, not including other forms of compensation, was $322,563.
Interviews with five finalists were conducted in January. The candidates include Sabah Randhawa, industrial engineering professor and Oregon State University provost; Meredith Hay, physiology professor, former University of Arizona provost, and adviser to the Arizona Board of Regents; E. Thomas Sullivan, University of Minnesota law professor and senior vice president for academic affairs; Robert Palazzo, biology professor and former Rensselaer Polytechnic Institute provost; and Thomas Apple, chemistry and biochemistry professor and University of Delaware provost.
With a salary of $289,869, Randhawa is the only candidate currently getting less than the amount Fogel was paid. Palazzo has the top salary, $410,000.
In response to the compensation report, state Sen. Philip Baruth, a member of the Senate Education Committee, has circulated a letter to Cioffi and the Board of Trustees – with copies to Gov. Peter Shumlin and state legislative leaders – that calls the document “disappointing in several ways, especially given that it was eight months in the making.” Despite stressing transparency, it fails “to make clear what, if anything, the Board intends to change about the process.”
Since 2002 there has been increased use of bonuses and deferred compensation deals, Cioffi reported, while more presidential candidates have hired lawyers to help with negotiations. Those interviewed for the report agreed that compensation should be tied to performance, but opinion varied on bonuses and other incentives “to recognize good performance.”
The report asserts a “widespread understanding” that salaries must be nationally competitive, but “tempered by some who believe that Vermont is unique and has different values, and should not be bound by the marketplace or a corporate culture. Graduate students proposed that the President’s salary be determined as a multiple of a faculty member’s salary or that of UVM’s lowest paid workers.”
Criticism abounds
Feedback from staff, faculty and students reflected concerns about lack of transparency “with respect to presidential compensation, especially with respect to multiple ‘perks’ in addition to salary,” the report said. Dissatisfaction about compensation during the Fogel transition, as well as the level of faculty salary awareness, has been “exacerbated by concerns over staff salaries.”
“Corporatization” is listed as an area of concern, without “a clear definition of what this means.” The report nevertheless acknowledges “widespread concern that UVM is becoming more ‘corporate’ in its operations and culture.” This is reflected in presidential compensation, both what the president is paid and perks that are not available to other employees, the report notes. It also acknowledges the widespread perception that Fogel’s severance package was excessive.
Baruth says a commitment to transparency is encouraging, but the public still needs answers to some lingering questions. In his response, he says that Cioffi’s letter references “a provision to address foundation monies that may be considered part of compensation.” But the guidelines show no new provision, Baruth wrote, “or any reference to the recently created University of Vermont foundation. Can you forward that provision? And can you make clear the Foundation’s place in executive compensation?”
The senator also asks what “will no longer be permissible under new Board guidelines.” Part of the problem with Fogel’s departure, argues Baruth, was the perception that his relationship with the board had become “over a decade, very close — perhaps too close for the most judicious application of Board policy and contractual provisions.”
Cioffi’s report is accompanied by survey results and letters from the Faculty Senate, graduate students, and student government. A five-question survey was used to solicit opinions and ideas from the Alumni Association.
Staff comments were also collected and summarized by Staff Council President Ida Russin and Vice President Michelle Smith. Many staff members talked about “unreasonable perks” and an exorbitant housing allowance. Several called the package offered to Fogel an inefficient use of resources that undermined confidence in the trustees.
Another point was that “Vermont has different cultural values and standards than the rest of the United States when it comes to executive pay,” the staff summary noted.
A letter from Julie Roberts, president of the Faculty Senate, says that “corporatization” of the university “is a broad concern of the faculty. Its echoes are heard when we are discussing many aspects of university life: class size, hiring new faculty (or not); the curriculum; investment in research, etc. but nowhere is it more prominent than in the discussion in the past few months of presidential compensation.”
Roberts explained that “faculty would agree that a president whose time in the job has come to a rather unfortunate end should not be paid an exorbitant amount at the time of his/her leaving.” And if that does happen, “and the board is for any reason unable to discuss it fully, I believe that the faculty would prefer to hear just that: The board is unable to discuss the reasons behind its decision.”
Writing as president of the Graduate Student Senate, Eduardo Cotill-Sanchez reported that an email had been sent to the whole graduate student body about compensation and the future, and a selection of individual opinions was attached.
Baruth points out that the feedback generally echoes the statewide response that salary increases and “non-base awards” should be kept under control. Nevertheless, “you seem to indicate that all of these elements remain fair game for the future.” Baruth wrote that he sees no substantial change in the way a future president will be compensated.
The public “has a right to insist that a strong, clear, enforceable policy on compensation help to direct the Board in such matters,” he concludes.
