UT System pay drawing closer look
Budget crunch spurs lawmakers to scrutinize administrative costs
By Sharon Jayson
Thursday, July 24, 2003
The University of Texas System's top 14 executives earn base salaries that total nearly $4 million -- just under one-quarter of the $16.6 million in base salaries for the system administration's 536 employees.
The boss, UT-System Chancellor Mark Yudof, makes $468,000. His total annual compensation package of $796,319 includes a house and an $8,400 car allowance and makes him the highest paid public university leader in the nation.
State legislators have taken a particular interest in executive salaries and overall administrative operations at the six major Texas university systems, but especially at the largest, UT.
Struggling to plug a $9.9 billion state budget hole, lawmakers grilled Yudof and other executives about expenses during the regular legislative session. At least three interim legislative committees are slated to scrutinize higher education. Two will focus, in part, on administrative expenses and operations and will issue reports for the 2005 Texas Legislature.
"The question is, `Is there value for what we're paying these people, and is it just too much of a good thing?' And I just don't know the answer to that," said state Sen. John Whitmire, a Houston Democrat who has spent three decades in the Legislature.
Less than $1 million of the UT System's $36.8 million administrative budget comes from state general revenue. Interest income from a public endowment that benefits only the UT and Texas A&M University systems pays executive salaries, including Yudof's, which is also underwritten by private donations. The endowment, valued at $6.9 billion, includes land, income from mineral leases, and investments.
The UT Board of Regents decides how system administrative money will be spent. The other four major university systems pay salaries from a combination of general state revenue and private sources.
That hasn't stopped the questioning. The tight budget season prompted legislators traditionally preoccupied with public schools and confounded by the complexity of university budgets to sit up and take notice. Also contributing to the scrutiny was legislators' decision to give university systems the authority to set their own tuition rates, a move that could prompt questions from parents and students should tuition bills make a steep and sudden climb.
"There are a lot of perceptions," said state Rep. Geanie Morrison, R-Victoria, who chairs the House Higher Education Committee. "That's why we wanted to do the select committee, so we could go in and look at each system and see how their operations are. We'll look at where their funding is going."
There is no uniform way to compare university systems from state to state because their operations and job definitions differ. Yudof and his lieutenants oversee more than 87,000 employees and 15 campuses ranging from UT-Austin, the flagship, to Houston's M.D. Anderson Cancer Center, one of six health-related institutions and a national leader in cancer treatment. System administrators operate from a complex of five buildings in downtown Austin.
Yudof defends the salaries, saying universities have to compete to attract top-level talent in such areas as business and legal affairs. He also said he welcomes the new scrutiny.
"Taxpayers invest a lot of money, students pay tuition and the federal government invests in research projects," he said. "We ought to be transparent about what good we do in the world."
A flexible hiring freeze that the UT System put into effect in November has reduced by 48 the number of system administrative office employees, at an estimated savings of $1.4 million. The jobs that were frozen ranged from secretary to assistant vice chancellor.
Yudof also said he soon plans to unveil what he calls a "serious reorganization" at the system level. He won't say yet how much his streamlining plan will save the UT System. But some of the money saved from the personnel changes will be used to add staff in the areas of accountability and research.
One of the new high-level positions, he said, will be a vice chancellor for research, to help compete for federal money and raise UT's profile in the area of technology transfer, which pairs university research and private enterprise to create new products.
State Rep. Dan Branch, a Dallas Republican, said he's willing to give Yudof time to sort out the administrative questions. In February, during a legislative hearing, Branch expressed concerns about "anecdotal reports there's a lot of duplication between what's going on at a component institution and what's going on at the system level."
Mindful of such concerns, Yudof has also ordered a rewrite of the system's mission statement to more clearly delineate between the administrative responsibilities at the campus and system levels. And he is confident that the reorganization will ultimately save money.
"You have individuals who have been very successful in their careers, and you can't recruit them with big salary cuts," he said. "If they do their jobs as well as you expect them to do, they more than earn it back for the state."
UT System pay
Base salaries for the top executives:
Chancellor Mark Yudof: $468,000
Special Adviser to the Chancellor Dan Burck: $386,198
Executive Vice Chancellor for Academic Affairs Teresa Sullivan: $265,000
Executive Vice Chancellor for Business Affairs Kerry Kennedy: $270,000
Acting Executive Vice Chancellor for Health Affairs James Guckian: $300,901
Vice Chancellor for Administration Tonya Moten Brown: $218,400
Vice Chancellor for Community Relations John De La Garza Jr.: $160,000
Vice Chancellor for Development and External Relations Shirley Bird Perry: $212,676
Vice Chancellor for Educational System Alignment Ed Sharpe: $230,000
Vice Chancellor and General Counsel Mike Godfrey: $216,320
Vice Chancellor for Governmental Relations and Policy Ashley Smith: $284,000
Vice Chancellor for Health Affairs Mike McKinney: $375,000
Vice Chancellor for Federal Relations Bill Shute: $176,800
Counsel and Secretary to the Board of Regents Francie Frederick: $200,000
Salaries are funded with interest income from a public endowment and, in some cases, private donations, except for one executive who receives a portion of his salary from general state revenue. Yudof's salary includes a mid-year state-mandated raise of $18,000 as of March 1. He has donated $9,000 to a chancellor's endowment he created.
How UT System stacks up
University systems differ. Some are made up primarily of academic campuses. Others include hospitals, research centers and, in the case of the University of Wisconsin System, community colleges. Here is a snapshot of four major systems:
University of Texas System
Head of system: Chancellor Mark Yudof; base salary of $468,000
Total budget: $7.02 billion (includes $36.8 million for administration)
Administrative staff: 536
Administrative base salaries: $16.6 million
Top executives: Base salaries for top 14 executives range from $160,000 to $468,000
Flagship campus: UT-Austin
Offices: Five offices in downtown Austin; one office in Washington, D.C., and some system divisions at seven campuses
University of California
Head of system: President Richard Atkinson (until Oct. 1); base salary of $361,400
Total budget: $13 billion (includes $44.9 million for administration)
Administrative staff: 535
Administrative base salaries: (not available)
Total system salaries $6.5 billion
Top executives: Base salaries for top 16 executives range from $207,100 to $395,000
Campuses: 9, with a 10th opening in 2004
Flagship campus: UC System does not use the term, but UCLA and UC-Berkeley are generally regarded as flagships
Offices : Three locations in downtown Oakland
University of North Carolina System
Head of system: President Molly Corbett Broad; base salary of $300,485
Total budget: $4.7 billion (includes $9 million for administration)
Administrative staff: 90
Administrative salaries: $6.4 million
Top executives: Salaries for top eight executives range from $85,770 to $300,485
Flagship campus: UNC-Chapel Hill
Offices: One building in Chapel Hill near campus
University of Wisconsin System
Head of system: Katharine Lyall; base salary of $304,980
Total budget: $3.2 billion (includes $9.5 million for administration)
Administrative staff: 124
Administrative salaries: $8.6 million
Top executives: Salaries for top five executives range from $137,350 to $304,980
Campuses: 26 (13 are two-year programs)
Flagship campus: University of Wisconsin-Madison
System offices: Two locations in Madison
Sources: University of Texas, University of California, University of North Carolina and University of Wisconsin systems