FSCJ's Wallace isn't only state college president with
lucrative contract
One Florida college president will get free health care — premiums,
deductibles and co-pays — for life.Another might, at the board’s discretion, get the college-issued car he’s been driving when he leaves the college.
And the president of the largest state college has been promised a yearlong paid sabbatical and tenured teaching spot when he’s ready to step down.
All likely at taxpayers’ expense.
Some higher education observers say perks like that are egregious for public institutions, while others call them necessary measures to retain top talent. But one thing these and all 28 Division of Florida Colleges system presidents have in common: the Office of the Inspector General is reviewing their contracts and compensation at Gov. Rick Scott’s request.
Florida State College at Jacksonville President Steve Wallace announced his plan to step down last month, following concerns about $4.7 million in wrongly issued Pell Grants and reviews of his expenses. Wallace recently negotiated a $1.2 million exit agreement that prompted the governor to ask for the state investigation.
READ: Florida community college presidents' contracts
But that contract didn’t award him fringe benefits as high-dollar as a select few Florida community and state college presidents are entitled to, a Times-Union review shows.
Seminole State College of Florida’s board has guaranteed that all the health costs for its long-serving president, E. Ann McGee, are paid for life. Lake-Sumter Community College in Leesburg has included a provision to sell or give to President Charles Mojock the car he drives when he leaves, although the value would be deducted out of his severance package. And Miami Dade College President Eduardo Padron will get health premiums covered for life, be allowed to keep his car, and be guaranteed a tenured spot on the faculty with six-figure pay after a paid sabbatical.
But the items that pushed Wallace’s exit into seven figures were not benefits. They were lump sums: the unlimited accrual of vacation time gave him $336,000. A “benefit day” account — which awarded Wallace one day’s pay per month until 2010, when it was increased to 1.5 days per month — will give him more than $250,000 at payout.
Five of the other presidents have similar provisions.
Some other colleges could have benefit day programs that are not specified in their president’s contracts; several also allow annual payouts of extra vacation even when they don’t offer unlimited accrual.
Randy Hanna, chancellor of the Division of Florida Colleges, declined to speak about the contracts at FSCJ and other colleges, saying the power to hire, fire and decide compensation lies solely with local trustees. But if the inspector general recommends changes after its governor-ordered investigations, Hanna said he would be listening.
“To the extent the inspector general shows a need for legislative change,” Hanna said, “the division will be directly involved in proposing a change that is best for our students.”
Scott said on Friday that he wants to see the costs of the benefits calculated when the Inspector General’s review is complete. More than half of Floridians make less than $50,000 a year, Scott said, and he will rely on the trustees to understand that this is “somebody’s money.”
“Think about, ‘If that was my money, if that was my company, would I spend money like that?’ ” Scott said. “I think we have to look at how taxpayer money is being spent. … Everyone ought to know.”
‘THERE SHOULD BE TRANSPARENCY’
Contracts don’t give calculations of the value of payout benefits. But the Times-Union reviewed records and college policies that show four other colleges would allow a president to accrue unlimited vacation days for a terminal payout like the one Wallace has. Two others are guaranteed a job at their respective colleges after their departures. The Times-Union reviewed only FSCJ’s peer state and community colleges; it did not include Florida’s university system.
“Add-ons,” as college president compensation expert Jim Finkelstein calls the extra benefits, make it difficult to get a handle on how much these academic leaders actually make.
“Being a public executive, they hold the public trust and should view themselves in the same way as any elected or appointed official of a public institution,” said Finkelstein, a George Mason University professor. “There should be transparency in everything they do — whether it be their expenses or their compensation.”
In Florida’s college system, benefits such as annuities, deferred compensation or “additional pay” boost the total compensation by 28 percent on average. At South Florida State College, only 8 percent of the president’s total compensation comes from sources outside his base salary. On the flip side is Palm Beach State College, where 48 percent of President Dennis Gallon’s income is from deferred compensation and additional pay.
Two other presidents in Florida’s state college system negotiated decidedly lucrative perks.
Padron, the president of Miami Dade College, is guaranteed a year-long sabbatical at his $600,000-plus compensation level, plus a tenured position with just a 10 percent reduction in pay and the “additional pay” he’s given at 31 percent of his base.
Miami Dade College board chairwoman Helen Aguirre Ferre did not return a call seeking comment. College spokesman Juan Mendieta said Padron’s compensation should be compared to his national peers who head public and private institutions.
Six U.S. presidents have appointed Padron to education panels, Mendieta said, and he has elevated the reputation of the college, which has nearly 60,000 full-time equivalent students. That is taken into account when he is compensated, Mendieta said.
“At the end of the day we have a very transparent process here, like many of our peer institutions,” Mendieta said. “Whatever reviews come, if any improvements or innovations can result, we have no issues with that.”
Seminole County’s McGee, whose total compensation is more than $420,000, is the only president in the state system whose college has offered to pay her co-pays and deductibles until her death.
Her contract also says she can keep the home office equipment she’s borrowing and that the college car she drives will be transferred to her ownership when she leaves.
When asked about her perks, McGee said in an email that the college, where about 15,000 full-time equivalent students are enrolled, now grants four-year degrees and is a major economic driver.
“We are without question a major organization that provides affordable educational opportunities that contribute to the growing trained workforce in Central Florida, which is more important than ever,” McGee said. “I have always felt the Seminole State College Board of Trustees has treated me equitably among my peers.”
Seminole State College board chairman Scott Howat said he wasn’t involved in the contracts that gave McGee the benefits but he feels her compensation is fair and appropriate.
“She has a competitive contract that meets her needs and the needs of the college,” he said.
McGee, president since 1996, also gets 10 paid days off per year by the college to do outside consulting work. Howat said he again wasn’t on the board when that perk was negotiated but he supports it because McGee is a recognized expert in high demand for her skills. He said she rarely uses all the days anyway.
“Trustees felt it was good to further our reach and brag on our leader by taking our practices around,” Howat said.
Gallon, who has been president of Palm Beach State College since he left his job as a campus president at FSCJ in 1996, is guaranteed 20 years of health care coverage and premiums. Gallon’s total compensation is nearly $451,000, and the college enrolls about 21,000 full-time equivalent students annually.
Dave Talley, chairman of the Palm Beach State College board, said the provision has been in Gallon’s contract “for a long time” and he doesn’t see anything wrong with continuing his benefits.
“I don’t think this is totally uncommon with other businesses,” Talley said.
Raymond D. Cotton, a Washington-based attorney who specializes in presidential compensation and contracts, said agreements between boards and their presidents must be examined in context. Benefits included in contracts often evolve over years to keep presidents from looking for jobs that offer more.
“I’ve never met a board that’s interested in giving away the institution’s money,” Cotton said. “If they struck a deal like that, there was a reason for it.”
CONTRACTS NOT ALWAYS GUARANTEES
Wallace, who has been president at FSCJ since 1997, was guaranteed a payout worth up to $851,000 by the contract he had in place before October.
But contracts sometimes are cast aside when it comes to a president’s exit.
FSCJ staff came up with four scenarios showing potential payouts for Wallace’s departure. They ranged from $362,000, for accrued benefits if he were fired with cause, to $851,000, including severance, if he were fired without cause.
Ultimately the board agreed to award him a new agreement valued at $1.2 million, which grew $477,000 above the previous calculations because it gave him a consulting role through June 2014.
A similar package was also contracted for the former president of Edison State College in Fort Myers, which has about 12,000 full-time students. Kenneth Walker’s total compensation was more than $800,000 and the highest in the system in the year before he was fired by the board. His most recent contract gave him a yearlong paid sabbatical with access to an office and all equipment, and a teaching position after he left.
An Edison spokeswoman said the college did not end up honoring the provisions.
“All of Dr. Walker’s rights in reference to his contract were terminated with the settlement agreement,” spokeswoman Teresa Morgenstern said.
In a mediated agreement, Walker left with a settlement valued at $540,000 and agreed not to sue.
Last week, negotiations brought the payout down from the most expensive scenario in the president’s contract at the State College of Florida, Manatee-Sarasota.
Lars Hafner, president of the college since 2008, had almost four years left in his five-year contract when the board voted to offer a $363,000 exit package. The contract specified the college should pay him for his entire contract term.
Eric Robinson, who the governor appointed last month to the board at State College of Florida, Manatee-Sarasota, said he was asked during the interview process how he felt about the severance given to Wallace. He said that kind of big payout wouldn’t happen at his college and he’s largely happy with their settlement — but only because automatic renewal and salary provisions forced their hand and they needed to avoid litigation.
“You think this is bad, wait until you see what we could’ve been liable for … because of the contract,” Robinson said. When the board of trustees abdicates certain responsibilities and duties so they don’t have to make those tough decisions, so they have an acrimonious relationship, this is the result. You don’t want to … end up giving up the farm. …”
At FSCJ, the payout is still not final. Though the board agreed to Wallace’s payment request, as of Friday board chairwoman Gwen Yates still had not signed it. She said the board could discuss it again at its meeting on Tuesday.
(a)
Periodic review shall occur at least every three (3) years.
(b)
Periodic review shall include, but not be limited to, factors as evidence of:
1.
quantifiable measurable effectiveness in the particular area of practice;
2.
continuing professional development;
3. currency
and scope of subject matter knowledge;
4. student
and faculty feedback and feedback from employers of students; and
5. service
to the department, college, and community.
(7)(5)(a) Each district board
of trustees The college may terminate dismiss an
full-time faculty employee under continuing contract, or return
the employee to an annual contract, for failure to meet post-award
performance criteria, or, for cause in accodance with college policies and
procedures upon recommendation by the president and approval by the
board. The president or designee shall notify the full-time
faculty employee in writing of the recommendation, and upon
approval by the board, shall afford the full-time faculty employee with
the right to formally challenge the action a hearing in
accordance with the policies and procedures of the college. As an alternative
to the hearing rights provided by college polices and procedures, the employee
may elect to request an administrative hearing in accordance with the
guidelines of Chapter 120, Florida Statutes, by filing a petition with the
board within twenty-one (21) days of receipt of the recommendation of the
president.
(b) The
board may dismiss a full-time faculty employee under continuing contract upon
Upon consolidation, reduction, or elimination of a community college
program, insufficient teaching load or restriction of the required
duties of a position by the board. The board may determine on the basis of the
criteria set forth in subsections (1) and (2) and (3), which full-time
faculty employees to retain should be retained on a
continuing or annual contract and which shall be dismissed or
returned to an annual contract. The decision of the board shall not be
controlled by any previous contractual relationship. In the evaluation of these
factors, the decision of the board shall be final.
(8) In addition, each college, after receiving input
from the faculty, shall develop appropriate criteria to measure student
success, which may include but shall not be limited to the following factors,
as appropriate: (i) demonstrated or documented learning gains, (ii) course
completion rates, (iii) graduation and/or certification rates, (iv) continued
success in subsequent and additional courses or educational pursuits and (v)
job placements in the appropriate field. Such factors
selected by the individual college shall be used, as appropriate, for the
particular field of learning and the individual faculty member, as
consideration in determining whether to grant a continuing contract pursuant to
(3) above. Such factors shall also be used, as appropriate, in the review set
forth in (6) above.
(9)(6) Any full-time faculty
employee holding a continuing contract who accepts an offer of annual
employment in a capacity other than that in which the continuing contract was
awarded may be granted an administrative leave of absence pursuant to the
college’s administrative rules.
(10) Each Board may award multiple year contracts,
annual contracts or contracts less than one year to full-time faculty
employees. No multiple year contract may exceed three (3) years. Each board
that awards multiple year contracts, annual contracts or contracts less than
one year shall establish rules and policies concerning such contracts.
(11)In order to provide for a transition period for
full-time faculty in the process for being considered for continuing contracts,
each board may provide an exemption from the time requirements set forth in
paragraph (2)(a) of this rule for faculty personnel being considered for an
award of a continuing contracts during the 2012-13, 2013-14 and the
2014-15 fiscal year. In addition, each board shall provide credit for
satisfactory years of service incurred prior for purposes of determining
eligibility for a continuing contract.
Specific Authority 1001.02(1), (9). 1012.83,
1012.855 FS. Law Implemented 1012.83 FS. History–Formerly 6A-8.33,
Repromulgated 12-19-74, Amended 12-9-75, 2-14-77, 12-26-77, 7-16-79, Formerly
6A-14.411, Amended 7-20-04,
