Baseball player Alex Rodriguez is drawing closer to signing a $275-million, 10-year contract with the New York Yankees, and with his salary climbing to record-setting heights he'll be in the company of another group of professionals whose paychecks are also ballooning: university presidents.
Those holding the prestigious and increasingly sought-after role of president at both private and public universities are getting larger checks, and receiving more public scrutiny, as compensation experts attempt to assign a dollar value to their jobs.
In its annual report on executive compensation, The Chronicle of Higher Education emphasized the growth in the pay of presidents of private research institutions like Tufts. Reports from the 2005-2006 fiscal year showed that three non-retiring private university presidents were receiving over $1 million in compensation: William Brody of Johns Hopkins University, Shirley Jackson of Rensselaer Polytechnic Institute and James Wagner of Emory University. In previous reports, former Vanderbilt University President E. Gordon Gee had been the only president at a private university receiving over $1 million.
Along with the expansion of the million-dollar club, the median compensation of leaders of private research institutions is growing rapidly. According to the report, the median compensation of leaders of private research institutions rose 37 percent in the past years surveyed and are now at $528,105, an all-time high.
Tufts University President Lawrence Bacow came in just above the average with a total compensation of $551,646 for the 2005-2006 year, according to numbers given to the Daily by Tufts Director of Public Relations Kim Thurler based on Bacow's 2005 and 2006 IRS 990 tax returns. This number includes both pay, which totaled $501,164, and benefits, which totaled $50,482.
The 2005-2006 numbers mark a substantial rise in Bacow's salary from the 2004-2005 year, when he received a total of $475,466.
With salaries on the rise, the public continues to keep a close eye on how executive compensation is determined in higher education. Tufts Board of Trustees Chairman James Stern explained how Tufts determines the president's compensation.
"It's a subject we take very seriously," Stern said.
According to Stern, the process begins every spring with the collection of written feedback from trustees and administration members regarding the president's performance. An executive session of the Board of Trustees is then held to discuss the president's performance, and Stern and Bacow meet to review the feedback and the president's assessment of his own performance.
"We gauge his performance every year," Stern said. "We gauge how well we think he's done."
Stern stressed the length and rigor of the assessment process, citing retention of personnel and the recruitment of deans as two of the performance markers used.
"It's a long list; it's not one or two things," he said. "The president is far from an outlier."
A subsequent compensation committee meeting is held during the summer months. Using numbers prepared by an outside consultant, the committee analyzes compensation of presidents at institutions comparable to Tufts.
Stern said the use of a consultant to gather statistics is important.
"The purpose of doing that is so the numbers are not washed," Stern said.
He explained that while the president's performance is essential to compensation determination, it is also imperative that the board consider compensation at other universities.
"We try to look at the schools that you all hear about that we consider to be our competition, whether it's Brown or Georgetown or Northwestern or BU," Stern said.
The Chronicle reported that Brown's Ruth Simmons received a total compensation of $689,007 during 2005-2006, Georgetown's John DeGioia $589,849, Northwestern's Henry Bienen $814,572, and Boston University's Robert Brown $692,599.
Stern said that Bacow's salary is far from excessive.
"We've taken a fairly conservative view of compensation.," he said. "We have tried to make sure that [Bacow] is paid fairly, within range, and, as it turns out in a lot of cases, below what a lot of comparable people make ... I think as you really look at what I would view as our competitive landscape, as I say, he is paid comfortably in the bands."
In addition to university compensation, The Chronicle reported estimates of presidential bonus packages and extra compensation from corporate sources, and did analyses of presidential spending at many schools. Stern was confident in the university's ability to track Bacow's compensation and spending carefully.
"I sign every one of the president's expense reports; there is nothing frivolous about his expense reports, that I can tell you," he said. "As a matter of practice, we audit Gifford House as well as the president's office."
He noted that the board openly discusses compensation at its executive meetings, leaving little to the imagination.
"We really get to what is total compensation," he said. "There are no hidden haymakers."
While Bacow's compensation is approximately half that of those in the growing million-dollar club, the president said he's satisfied with his paycheck.
"I think I am compensated quite fairly," he told the Daily in an e-mail.
Stern asserted that in higher education, being a college president is about the job, not the money.
"If they were in it for the money, I think there were probably other avenues and vocations they may have followed," he said.
Accordingly, it is unlikely that Tufts' president will be in the running for a million-dollar compensation package any time soon.
"I am not privy to the conversations at other universities that determine presidential compensation," Bacow said. "That said, if I were a trustee, I would ask some hard questions about million-dollar compensation packages."
Despite the fact that Bacow's pay is essentially average in comparison to his peers at other private research universities, students polled expressed disbelief at the size of his current salary. Senior Jes Weren questioned how compensation of professors often pales in comparison to that of university leaders.
"What is a school without its professors?" she asked. "They're the ones imparting the knowledge onto us."
But while the dollar value of President Bacow's paycheck provided a shock for many students, they were quick to support his role as president and praise his work on campus.
"He works hard and has done a great job at this school ... it's a very important job," senior Sarah Fleischmann said.
Junior Matt Hennessy compared the president's role on campus to that of a CEO.
"Essentially, he's managing a big company-like entity," he said. "[His salary] makes sense."
