On June 25, 2012, the Board of Trustees voted to raise the maximum salaries that can be paid to top administrators under CUNY’s Executive Compensation Plan (ECP). Upper limits for senior executive titles were boosted by up to 41%, while maximum pay for CUNY college presidents was raised by 23% to 29%, depending on the institution.
Noting that the ECP approved in 2006 called for executive salary levels to be reassessed “no less frequently than every five years,” the board’s resolution said that action was now overdue. The trustees emphasized that “competitive, market-driven compensation for the chancellor, the presidents and other senior executives is necessary and critical to the success of CUNY.”
A student petition said that any such raises would be “a shameful use of taxpayer and tuition dollars, especially when students are being burdened with tuition hikes,” and urged the board “to reject increases in executive pay and save tuition dollars for student aid.”
At a protest outside the Board meeting, Sandra May Flowers, student government president at Hostos Community College, told Clarion that the increases to CUNY’s executive pay ranges were excessive. Flowers said she was still trying to pay off $650 in bills owed from last semester, while coping with a recent layoff from her job as a medical assistant.
At the June 25, 2012 meeting, Chancellor Matthew Goldstein emphasized that no actual salary increase for any individual was currently being proposed. “This simply establishes new ranges,” the chancellor stressed.
University Student Senate head Kafui Kouakou, who serves as a trustee ex officio, said he understood the rationale for a review of salary ranges. Nonetheless, he said, students want to know when any actual increase might happen. “Their fear is that this might happen in a year or two, and they wouldn’t feel comfortable with that,” Kouakou said. “Students feel that if there is going to be an increase in the tuition for the next five years, there should not even be a consideration” of boosting executive pay ranges, he concluded.
“The best I can say is that I have absolutely no plans to recommend any salary increase for any members of the executive group,” the chancellor replied. “To say when that would change is subject to lots of variables that are not clearly defined at this particular point in time.”
Trustee Jeffrey Wiesenfeld condemned “this extreme striving for egalitarianism…that’s forced on the Board.” In Wiesenfeld’s eyes, “It’s just needless rancor, [when] students and others could be using their energy more productively.”
The resolution originally called for the maximum salary for the position of chancellor to rise from $470,705 to $724,470 – an increase of 54%. At the last minute, the chancellor asked that the resolution be revised to remove those specific numbers. As a result, the new ECP removes limits on the chancellor’s salary that had existed before: instead, the new ECP sets no maximum for the chancellor’s pay and says only, “Future salary to be determined by the Board of Trustees.” Asked why the numbers were removed, CUNY spokesperson Michael Arena said only that it was at the chancellor’s request.
After this amendment was accepted, Board Chair Benno Schmidt argued forcefully that “the chancellor’s own compensation is considerably below market,” and that a substantial increase would be well-deserved.
At the board’s public hearing on June 18, 2012, PSC President Barbara Bowen spoke against the changes to the ECP. In the context of this proposal for CUNY managers, Bowen said, “it should be unthinkable [to] come to the faculty and staff and ask us to accept a contract that has anything but competitive salary increases.” It should be just as unthinkable, she added, “to ask students, some of whom are among the poorest college students in the country, to pay tuition increases that will in part go to fund those future salaries.”
Bonnie Nelson, a member of the library faculty at John Jay and a union delegate, told Clarion that faculty and staff at her college were “particularly disturbed” by several elements in the proposal, including a provision for unlimited “bonus opportunities” at the discretion of the chancellor, and continuation of housing allowances of $60,000 to $90,000 per year. “People are also upset about the chancellor emeritus salary,” Nelson said.
The new ECP provides, for the first time in CUNY history, for a salary to be paid to a chancellor emeritus. The position of chancellor emeritus is not new at CUNY, but in the past this appointment – like emeritus faculty positions – has been unpaid. The amount of this new salary is apparently unrestricted: the new ECP says only that “the salary will be determined by the Board of Trustees.” A chancellor emeritus may draw this salary for up to ten years.
When asked why chancellor emeritus had now been made a salaried position, Arena noted that CUNY’s “long-standing policy provides a chancellor with a University Professor faculty position upon completion of service or retirement,” subject to approval by the Board of Trustees. The title of chancellor emeritus was added to the ECP in a recent revision of CUNY’s bylaws (see psc-cuny.org/clarion/march-2012/letters-editor).
Previous top salaries for CUNY vice chancellors ranged from about $248,000 to $349,000. Those upper limits have now been increased to around $301,000 to $453,000. For college presidents at CUNY, the former maximums were approximately $244,000 to $299,000. The highest allowable pay is now more than $300,000 for presidents at all CUNY colleges, ranging from $324,000 at community colleges to $371,000 at “top tier” colleges such as CCNY or Queens.
The Board’s resolution noted that the increased pay ranges “are based in large part on a market analysis conducted by [the consulting firm] William H. Mercer, Inc.,” a point that was stressed by several trustees in the meeting’s discussion.
CUNY has relied on Mercer, a well-known human resources consulting company, for advice on executive pay levels since 2000. The firm was in the headlines in 2004 due to its involvement in the New York Stock Exchange’s approval of a controversial $139.5 million salary package for then-Chairman Richard Grasso. In a settlement with then-Attorney General Elliot Spitzer, Mercer admitted that its report to the NYSE’s board had contained “inaccuracies and omissions” that misled the board about how much the raise for Grasso would cost the NYSE. Some of these false statements were made at the direct request of an NYSE executive and Grasso crony.
In 2010, The New York Times reported that executive pay at CUNY had dramatically outpaced inflation during the preceding decade (see tinyurl.com/CUNYexecs). For example, the salary paid to CUNY’s general counsel increased by about 100% between 1999 and 2009, while the chancellor’s base pay was raised by 96% (see tinyurl.com/CUNYexecsGraph).