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Gov. Pawlenty on MnSCU chancellor’s $40,000 bonus: ‘unwise and out of sync’

Even Gov. Tim Pawlenty thinks the $40,000 bonus for the chancellor of the Minnesota State Colleges and Universities system was a bad idea. Keep in mind that Pawlenty appoints members of the MnSCU Board of Trustees, who approved the bonus for Chancellor James McCormick.

Here’s the official statement from Bruce Gordon, the governor’s spokesman:

“The Governor remains a strong advocate of performance pay for teachers and certainly appreciates Chancellor McCormick’s public service, but a bonus during these economic times is unwise and out of sync.”

The governor’s position isn’t breaking news. I heard a snippet of this same statement on a KARE-11 broadcast.

About three-dozen union members protested Tuesday outside MnSCU’s central office in downtown St. Paul, calling for McCormick to return the bonus and for the end of bonuses for high-level administrators, including campus presidents. MnSCU gave out about $287,000 in bonuses last year but has not yet finalized administrators’ bonuses, which range up to $15,000 per person, MnSCU spokeswoman Melinda Voss said. The board authorized McCormick’s bonus on top of his $360,000 annual salary because he reached four of his five goals.

Meanwhile, MnSCU employees have been under a two-year wage freeze, and 550 positions are to be cut over a two-year period through attrition and layoffs in the system of 32 colleges and universities.

Board chair stands by bonus
So far, there has been no talk of McCormick’s returning the bonus, Voss said Wednesday. The union protests occurred as the board was meeting this week.

I asked for a reaction to the governor’s statement and she sent this comment from MnSCU Board Chairman Scott Thiss, CEO of Sailforth: “Now more than ever, the system needs a strong visionary leader. The board believes that paying for performance is the best way to assure that kind of strategic focus.”

The bonus, which has become another b-word thanks to outlandish bonuses for CEOs in corporate America, appears to be much more common in the business arena than in tax-supported universities. The MnSCU flap made me wonder if the University of Minnesota, the other public university system, has a similar approach in place for President Robert Bruininks and top-level administrators. The U’s board is not appointed by the governor.

“That’s a relatively simple answer: no,” U spokesman Dan Wolter said in an email. “Also, for President Bruininks and administrators, pay has been frozen for more than a year. Additionally, they received a pay reduction beginning July 1 of 2.3 percent, twice what other U of M employees received (some received a 1.15 percent pay cut and others received three furlough days). This was an important part of balancing the University’s budget in light of cuts in state appropriation.”

Last year, Bruininks’ salary was $455,000.

Pawlenty, a Republican, also froze his $120,303 salary as well as the salaries of most department heads throughout his nearly eight years in office.

A business-oriented board
Although McCormick became chancellor during former Gov. Jesse Ventura’s administration, Pawlenty has been appointing MnSCU trustees since he took office. Among those appointees are business-oriented Republicans like Duane Benson, former head of the Minnesota Business Partnership, and Dan McElroy, commissioner of the Department of Employment and Economic Development and a former legislator. Here’s a roster of the current 15-member board.

Pawlenty also recently appointed former Republican state legislator Phil Krinkie, president of the conservative Taxpayers League of Minnesota, as an at-large trustee. I have a difficult time seeing Krinkie supporting future bonuses for public university administrators in tough times, based on what he told me last year in a story about the pay-cut trend. At the time, Krinkie, who owns a small business,  had written op-ed pieces proposing that any government employees making more than $100,000 a year should take a 10 percent pay cut. Here’s a quote from my story:

“The problem with pay freezes or furloughs is that they fall very unjustly across the spectrum,” Krinkie said at the time. “If we look at pay freezes or pay reductions, it should be top-down — not bottom-up.” The janitor making $25,000 to $30,000 is going to suffer more than someone making more than $100,000, he said. “I’m just saying that in challenging times we see businesses taking salary cuts, we see job-sharing, we see all sorts of measures in an economic downturn. Yet it seems as though if we talk about a government worker getting laid off, ‘what a terrible consequence.’ “

The MnSCU board on Wednesday also appointed a search committee for the next chancellor of the system because McCormick is retiring next year. Former board chairman David Olson is heading up the 16-member committee, which includes former Minneapolis Mayor Sharon Sayles Belton, now a vice president for Thomson Reuters, as well as legislators from both parties, student leaders and the heads of faculty unions. Full list.

Meanwhile, at least one candidate for governor has said bonuses for MnSCU administrators will come to an end if he is elected. Mark Dayton, a DFL candidate, showed his support for union protesters Tuesday.

Correction: This story originally said that MnSCU gave out $300,000 in bonuses to administrators this year. MnSCU awarded $287,000 in bonuses last year, but has not yet awarded bonuses this year. The story has been updated to reflect the lower amount and the timing.

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Comments (4)

  1. Submitted by Bill Gleason on 07/22/2010 - 09:07 am.

    So let’s see..

    McCormicks salary is frozen at 360K$ but he got a $40K bonus.

    That works out to 11%, doesn’t it?

    I am always amused when someone implies that because they run an expensive, complex, enterprise, they are worth the large salary they are being paid. I’d love to see one of these folks try to run a company like 3M or Medtronic – they’d get cut off at the ankles.

    When’s the last time you’ve heard of a university president going off to run a large corporation? Maybe sit on a board for a couple of hundred thou a year (see Ruth Simmons/Goldman Sachs), but RUN a company? In your dreams…

  2. Submitted by Paul Brandon on 07/22/2010 - 12:20 pm.

    Ruth Simmons’ main achievements are Brown have been raising money.
    And note that Brown University is a private corporation.

    Of course, for Tim (absentee Governor) Pawlenty to criticize someone for taking money that they didn’t earn is somewhat ironic.

  3. Submitted by Bill Gleason on 07/22/2010 - 02:17 pm.

    I’m not quite sure what Brown being a public university has to do with this?

    My point is that university presidents, most of them, would have a rather difficult time running a large corporation. Therefore, claiming that they should be paid like a business executive is silly. For more on President Simmons’ business acumen, demonstrated during her ten year tenure at Goldman Sachs, please see the excellent pieces by Margaret Soltan (George Washington University), e.g.

    http://www.margaretsoltan.com/?p=22994

    There is another little irony with a Minnesota connection. Bill “St.” George is another Goldman Sachs board member. That’s right, the guy who made a career on ethics in business…

    TeaPaw? That one even I won’t touch…

  4. Submitted by Bill Gleason on 07/22/2010 - 02:28 pm.

    Sorry, I’m not sure what Brown being a PRIVATE university has to do with this…

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