The University of Nebraska board of trustees will consider giving the system’s top administrator a contract extension at its meeting next week, and with it, a raise and a chance to win a lucrative bonus.
Encouraging President Ted Carter to stay at NU through 2027, giving him a 3% increase in his base salary and providing healthy deferred compensation should be seen as a vote of confidence in his leadership, said Regent Bob Phares .
“Ted Carter was the right leader at the right time for the University of Nebraska system and our state as a whole,” Phares, of North Platte, said before the Aug. 11 meeting at Varner Hall. “We want to keep him as long as possible.”
In total, Carter’s total compensation could top $1.5 million in 2023.
Details of Carter’s restructured contract include:
* Carter was hired by NU in 2019 and given a 5-year contract that expires Dec. 31, 2024, but the Regents want to extend his tenure as head of the university system with campuses in Lincoln, Omaha and Kearney until Dec. 31 December 2027.
* A 3% increase in Carter’s base salary – the same merit increase given to all NU employees this year through an agreement with the Legislature and Gov. Pete Ricketts – would take his annual salary from $934,600 to $962,638.
The salary increase comes from NU’s subsidized budget, which includes appropriations from the legislature and tuition income.
* The board will also consider awarding Carter a performance bonus for his work during the 2021-22 academic year.
Under the terms of his contract, Carter is eligible to receive an amount equal to 15% of his salary if he achieves a series of metrics determined by the board.
Last year, the Regents said Carter had achieved 95% of the benchmarks set for him and voted to award him a performance bonus of $140,190.
This year, however, with declining first- to second-year retention figures for NU students across the system, Carter only achieved 89% of the performance metrics set for him.
The board will consider awarding him a bonus equal to three-quarters of the total amount he is eligible for, or approximately $105,000.
* Under the new contract under review, the Regents could also provide Carter with a second deferred compensation package – money he is eligible to receive each year he remains at NU.
Carter already has deferred compensation – funded by private donors – equal to 11.5% of his base salary.
The regents could award him a second privately-funded package that would put $340,000 into an investment account from 2023 that he could withdraw from January 2024.
Both deferred compensation programs would be administered by the University of Nebraska Foundation, a university spokeswoman said.
James Finkelstein, professor emeritus of public policy at George Mason University in Virginia who studies the contracts of college presidents, said deferred compensation programs have become increasingly common in higher education.
In the corporate world, deferred compensation packages are designed to keep high performing executives in the company by promising them a payout after a certain number of years – often referred to as “golden handcuffs”. , according to Finkelstein.
The proposed change to Carter’s contract includes “golden handcuffs” language:
“The university would suffer a loss if President Carter accepted another offer of employment, and therefore it is proper, necessary, and reasonable to provide President Carter with additional compensation on a deferred basis as an incentive for him to serve and continue to serve. serve as president.”
While a deferred compensation package can be used to keep a higher education leader at an institution — the terms of chancellors and presidents have been shortened in recent years — Finkelstein said most top administrators level do not occupy other managerial positions.
“What (a deferred compensation program) really accomplishes in higher education is that the public doesn’t know the true value of a president’s compensation until the compensation is received,” he said. he said, often postponing public scrutiny until compensation is paid years later.
Still, deferred pay is becoming the norm, especially among Big Ten Conference universities, which, outside of football and basketball coaches, are often the highest-paid public employees in their respective states.
Penn State University’s board of trustees will pay its new president, Neeli Bendapudi, a base salary of $950,000 with $350,000 in additional pension contributions.
And the University of Minnesota’s board of trustees approved a deal with President Joan Gabel that increases her supplemental pension contributions by $250,000 with annual increases of $10,000.
Gabel’s total compensation will reach $1.2 million this year.
As a university’s salary and benefits increase, Judith Wilde, a research professor at George Mason who studies the language of presidential contracts alongside Finkelstein, said other higher education leaders will take notice. .
“Presidents know which of their colleagues are getting how much money and may even be aware of some of the benefits,” Wilde said. “They may be looking to get some of the same things.”
And, with attorneys who specialize in getting the best possible deal for university leaders, these people are often able to get what they’re looking for.
Wilde said George Mason’s research also noticed that governance boards were also more willing to play ball.
“Big universities and flagships in particular have boards where more people come from the corporate world,” Wilde said. “They’re used to seeing salaries like this, they’re used to seeing some of the perks that presidents get now.
“It doesn’t surprise them,” she added.
Top photos of the Journal Star of the month of July