As student debt rises, perks and high pay for top college officials

A report released by the Federal Reserve Bank of New York late last month found that student debt in the United States, which is now approaching $1 trillion, "is the only kind of household debt that continued to rise through the Great Recession." According to The Institute for College Access and Success, students in the class of 2011 who borrowed for college graduated with an average of $26,600 in student loan debt.

Meanwhile, dozens of top officials at colleges and universities saw compensation packages in 2010 in excess of $1 million, according to the Chronicle of Higher Education. At New York University, the New York Times reported on Monday, top executives have received massive compensation packages upon their departure, including $685,000 to former executive vice president Jacob J. Lew and $1.23 million to former medical center executive Harold S. Koplewicz. Two former presidents of the expensive private university continue to live in apartments owned by N.Y.U., the Times reported, and current president John Sexton will be paid $800,000 per year upon his departure. 

In response to that report, CBSNews.com requested the most recent 990 tax filings from four prominent universities in the region: Harvard University, Princeton University, Yale University and Columbia University. All but Yale provided their tax forms, which suggests that N.Y.U.'s practices are not unique.

At Columbia, for example, president Lee C. Bollinger was paid $950,635 in 2010. In addition, he was granted $608,618 in "retirement and other deferred compensation." The tax return explains that the university paid Bollinger more than $583,000 in supplemental retirement income in 2010 "based on cumulative annual credits including amounts for achieving performance measures."

In addition, Columbia said, Bollinger is provided an apartment valued at $333,937 - a non-taxable benefit - and "a car and driver to be used by the president in connection with his duties." (Bollinger is not the university's highest-paid employee: Three employees were paid more than $2 million, including cardiologist Jeffrey Moses and dermatologist David Silvers.) A representative for Columbia declined to comment on Bollinger's pay package. 

At Princeton, where top salaries were generally lower than at Columbia, President Shirley Tilghman was paid a total of $902,205 in 2010. (She was also not the highest paid employee: A pair of investors for the university, Andrew Golden and Jonathan Erickson, both made more than $1.4 million.) One departing employee, former lead fundraiser Brian McDonald, was given a $400,000 severance package upon his departure. 

Harvard, which lists the 2012-2013 cost of attendance for undergraduates at $57,950 - $62,950, reported that former Business School Dean Jay Light received $1 million in retirement incentive plan payments on top of his $238,654 salary. Former business school professor Robert Merton was paid $734,000 in retirement incentive plan payments. Professor Marc Kirschner, the founding chair of the Department of Systems Biology, received $1,138,524 in supplemental retirement payments.

Harvard, like many top universities, acknowledged paying certain tax obligations for top officials. Harvard's president, Drew Faust, was paid a total of $875,331, which partially includes the value of the house she is provided in Cambridge.

According to the Chronicle for Higher Education's 2012 survey, the median pay for private college presidents in 2010 was $396,649, with 36 presidents making more than $1 million. On many campuses, there is a wide gap in compensation between top officials and professors; many adjunct professors complain of low pay and a lack of benefits. 

At so-called "for-profit colleges," which are not included in the Chronicle analysis, a Congressional report last year found that "lavish" executive compensation, is based "predominantly on the profitability of their companies rather than the success of their students." (The Associated Press reported that one such executive, Todd S. Nelson of Education Management Corp., made more than $13 million in 2011.) This compensation is subsidized by taxpayers, since much of the tuition paid to for-profit colleges comes from federal financial aid.   

Salaries for top officials at public and private colleges and universities have relatively little impact on overall budgets, but Kyle McCarthy, co-founder of the advocacy group Student Debt Crisis, said officials should offer to take smaller salaries in order to "lead by example" in the effort to control rising tuition costs.

"We're seeing tuition skyrocket and people being priced out of being able to go to college, and yet these presidents and executives are making huge amounts of money," he said. "It's just not fair."

Correction: This story has been changed to fix an incorrect gender reference to Harvard President Drew Faust.

[MikeHeXt]

where are the for-profits mentioned in this? they're the major reason

[SocraticRebels]

So federal government increases Pell Grants to offset higher tuition to pay Presidents hundreds of thousands of dollars. Good plan.

[sabniz]

i found that those college presidents/top officials are really shameless to get so much pay and compensation and at the same time ruthlessly raise tuition on students year after year, even those in public universities and colleges.

it is really hard for them to explain how they deserve to be paid that much and yet students not to get any tuition breaks. it also involve the school board of directors, who would award such lavish compensation packages to school presidents or to officials, despite the funding for school being cut from their state. there's really no excuse for this!

[fred9098445]

Where is Obama's support of all the young folks who put him in office? As someone who grew up poor, got a full academic scholarship for undergrad and then shelled out $250K for medical school, I can tell you that certain professions will only be obtained by the rich in America going forward. How ironic that the leader who campaigns using the 'anti-rich' message is in reality helping only the super rich and the super destitute. At 6.8% interest my debt is spiraling out of control while in residency. I paid >60% of my AFTER TAX income last year in INTEREST! All the while society tags me as a 'rich doctor', really a product of the 'doctor-hate' campaign going on in the media over the past several years. Crazy to think that I drive a 14 year old plastic Saturn and barely have enough money to pay rent. Oh, and did I mention that Obama's brilliant payroll tax hike costs me $300 a month. The best part is I go to work every day and hear 'CMS' and 'Affordable Care Act' fifty million times (and it's never cast in even a remotely positive light). So bottom line if your young and poor or lower middle class: either win the lottery or get a government job!

[RobertVBrand]

Inevitably, to reform medical costs, the government must pay for all medical education -- who can blame a doctor for being greedy when he graduates with a $250K debt?

[lucifersshadow]

They are always criticizing socialism, but the results of pure unadulterated capitalism are before your eyes. The hypocracy is no problem for them, it supports them making their wallet fatter.

[notenuff]

Every extra dollar we and the government(lol) give to schools go into the administrations pockets!! So quit giving our money(U.S.Publics) to schools and cut down on Admins pay maybe(justMaybe) the pupils will be taught the three R,s and be able to face their $56,000 debt for each citizen of the U.S. Good Luck students!!!!!!!!

[Jhihmoac]

...and let's not forget the multi-million dollar salaries these college coaches receive...Just like their upscale pro football cohorts!

[jimmyc1955]

Colleges and Universities are quickly locking the middle class out of higher education. The wealthy can afford the schools, the minorities will get aid - the middle class will be burdened with debt, limited access to better schools and depleted retirement accounts.

Meanwhile most states find their highest paid employees all work at universities. Colleges go on building sprees like Pharaoh's building tombs. Presidents leave legacies of stone and steel while students are burdened for the first 20 years of their professional lives paying of school loans.

So for all you progressives who want to protect the middle class - take a pay cut and pay for some of your benefits so those children you enlighten can afford to live a life after their 5.5 years of chasing a undergraduate degree in sociology.

[Jhihmoac]

I'm with you on this, but unfortunitely when these student loan "fatted cash cows" finally do come to an end (and they eventually will), I fear a handful of these educational institutions will do a complete about face, and close their doors permanently...

[gbgentleman]

Hypnotoad, I agree that the lower level of instructors make $50K-$70K but do a search on college professor salaries paid by state and you'll find many, many full professors at major universities who make in excess of $150K per year. Many of those have reduced teaching schedules (so they can research).

Look at some of the hiring requirements on job sites like higheredjobs.com, Universities want professors who can bring in grant money more than they want educators who are dedicated to their students.

[littleredtop]

This kind of compensation is common across America, and when combined with institution paid grant and scholarship programs focused on foreigners and athletes, make it cost prohibitive for American students of average income families to attend college.

[fred9098445]

your right on with that little red!

[mesopotamianmon]

This is the same crap that's going on in every aspect of American culture. Those at the top are flying high while the rest see a steady decline.