Sunday, September 28, 2008

3 yards and a pile of money......the entitlement mentality is alive and well at OSU...ON YOUR DIME!‏

Gee has added senior execs, boosted pay
Payroll for 14 OSU advisers, up from 9, will top $5.7 million in '09
President E. Gordon Gee makes no bones about it: In the year since he rejoined Ohio State University, he has more senior executives and at higher salaries than his predecessor did.

Former President Karen A. Holbrook relied on nine executives who collectively earned a little more than $2.8 million a year in base salaries. With the addition of Ohio House Minority Leader Joyce Beatty in January, Gee will have 14 senior advisers who will collectively earn at least $5.7 million a year.

"Sure, it is a lot of money," Gee said. "But in the end, it is not about the money. It's about making an investment in this institution and in our future."

Both of Gee's latest hires -- Beatty, who will be senior vice president for outreach and engagement, and Caroline Whitacre, a College of Medicine professor who has been promoted to vice president for research -- will make more than $300,000.

In all, 11 of Gee's top administrators will make at least that much, not counting deferred compensation and potential bonuses. Only three of Holbrook's team members made $300,000 or more.

Gee said that when he returned to Ohio State last year, he told trustees that he had to be able to hire the best people to move the school to the next level. And the only way to do that was to offer competitive salaries, he said.

"This is a great institution, and its greatness has been created despite underperforming in several areas," Gee said.

Through a similar effort at Vanderbilt University in Tennessee, Gee was able to raise $1.75 billion two years ahead of schedule, increase the school's endowment by nearly 50 percent and almost double the funding for academic research, he said.

OSU's recent hires reflect a larger problem, said state Rep. Jay Hottinger, R-Newark: State colleges pay administrators too much.

"The president of the United States makes $400,000 and arguably has the most difficult job in the country," said Hottinger, chairman of the House Finance Committee. "How many $300,000, $400,000 and $500,000 salaried administrators does one single university need?"

OSU officials said they didn't decide willy-nilly how much money to offer. They studied market norms for colleges and major nonprofit organizations and tried to offer salaries in the middle to upper range for those positions.

"We didn't invent this," said Larry Lewellen, associate vice president for human resources.

In a few cases, such as Beatty's job, OSU officials couldn't find a similar position at the other schools, so they made a value judgment based on how much OSU pays its other senior leaders.

Beatty's $320,000 base salary is nearly four times what she makes in the General Assembly. Like other senior vice presidents, she will earn additional deferred compensation of 20 percent of her base salary each year if she stays at least five years, and she also could earn an annual bonus of up to 30 percent of her base salary.

Lewellen said the school didn't negotiate any individual contracts, and bonuses will be measured against multiyear, outcome-based goals.

"We pay far less than the private market, where leaders can make multimillions of dollars," he said.

Gee said administrators who perform at extraordinary levels will be the only ones to get the full value of their bonuses. Others might receive no bonus.

"Nothing is a given," he said.

Compensation expert Jonathan Fortescue said all top public research universities are following the same path.

States have reduced their funding, so colleges need to raise more money from individual and corporate donors, research and sponsors, said Fortescue, who is managing director of the J. Robert Scott Executive Search firm in Boston. To get that money, universities are offering attractive compensation packages to lure the brightest executives, he said.

Ohio State did not provide the market studies it used to set compensation levels. But the University of Michigan, which is one comparison school, has 12 cabinet members, a majority of whom are paid between $200,000 and $400,000. OSU officials did provide the middle to high salary ranges for several top positions based on a compilation of the surveys. For example, senior vice presidents of health sciences make $657,000 to $927,000; provosts, $444,000 to $519,000; and senior vice presidents of business and finance, $273,000 to $470,000.

Senate President Bill M. Harris and House Speaker Jon Husted said Gee can hire whomever he wants as long as he holds them accountable.

"I'm more than willing to be patient to see if Dr. Gee can reach his goal of pushing Ohio State into the Top 10 -- and hopefully make it the No. 1 university in the nation," said Harris, R-Ashland.

Husted, R-Kettering, said of OSU: "I expect them to become affordable and efficient."

OSU board Chairman G. Gilbert Cloyd said the trustees don't intend to raise tuition in the immediate future as long as the state doesn't reduce funding.

He said the board set goals before hiring Gee and worked them into the president's five-year plan for the university. Several of the new positions, including Beatty's, were described in that plan.

"One person can't do it alone. It gets overwhelming," Cloyd said.

Ohio's higher-education chancellor, Eric D. Fingerhut, said he will hold Gee and OSU trustees responsible for increasing the affordability, enrollment and quality of Ohio State.

"We're concerned about how every dime is spent," Fingerhut said.

Gee said the salaries of his senior staff members will be paid with money from initiatives that have saved Ohio State $100 million.

Gee said that if he and his team haven't reached their goals in five years, "I will pump gas in Vernal, Utah."

Larry KehresMount Union Collge
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