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December 8, 2005

Officers’ pay increased 3.0 to 7.5 percent

Pitt trustees have increased Chancellor Mark A. Nordenberg’s salary to $427,500 — a raise of 3 percent over his fiscal year 2005 salary.

In addition, the trustees compensation committee yesterday approved raises ranging from 3.25 percent to 7.5 percent for six other Pitt senior officers, based on recommendations by Nordenberg.

Executive Vice Chancellor Jerome Cochran received a 4 percent increase to $300,000; B. Jean Ferketish, secretary to the Board of Trustees and assistant chancellor, received an increase of 4.9 percent ($170,000); Arthur S. Levine, senior vice chancellor for Health Sciences and dean of the School of Medicine, received a hike of 3.25 percent ($650,000); James V. Maher, senior vice chancellor and provost, received a 3.75 percent raise ($318,500); treasurer Amy K. Marsh’s salary increased by 6.1 percent ($210,000), and Arthur G. Ramicone, vice chancellor for budget and controller, received a 7.5 percent raise ($230,000).

The salaries are retroactive to July 1, the beginning of Pitt’s fiscal year.

In addition to his base salary, Nordenberg will receive five annual deferred retention incentive payments on June 30, 2007. The bonus program will give Nordenberg $75,000 for each year of service from July 1, 2002, through June 2007, if he doesn’t leave his job or isn’t dismissed before then.

Maher, Cochran and Ramicone will receive deferred bonuses of $50,000 per year under the same conditions.

In making his recommendations to the compensation committee, Nordenberg said the team of senior administrative officers is characterized by extraordinary talent and tireless devotion to Pitt.

Nordenberg said, “Within the major university community, market pressures have pushed the salaries of senior financial officers up at a somewhat steeper rate. That difference is reflected in my salary increase recommendations for our treasurer and vice chancellor for budget and controller. However, I want to underscore the fact that the performance of each of these officers has been outstanding and that the University of Pittsburgh has benefited immeasurably from their service.”

Trustees vice chair Thomas J. Bigley, who chaired the meeting in the absence of board chair Ralph J. Cappy, praised the efforts of Nordenberg and the officers. “The University’s trustees continue to be impressed with the dramatic advances made by Pitt. Pitt has moved through a decade of extraordinary progress. Many have contributed to our successes, but exceptional leadership has been key to all that has been accomplished.”

The Dec. 7 trustees compensation committee meeting was held via conference call coordinated in 159 Cathedral of Learning, and broadcast by speakerphone to reporters in attendance. Media members were not permitted to address the trustees or the chancellor.

After the meeting, Pitt spokesperson Robert Hill was asked about the chancellor’s intentions to stay at his job through June 30, 2007, the duration of the deferred retention incentive plan.

Hill said, “The chancellor has no intention to leave the University. He is devoted to Pitt and plans to stay here through June 2007 and beyond. In fact, none of [the senior officers] is planning to leave.”

Pitt senior officers also receive executive benefits that include: an automobile for personal and business use by the chancellor and by other officers as determined by the chancellor; personal liability insurance coverage of $5 million; group term life insurance and accidental death and dismemberment insurance policies, each in the amount of $50,000, plus three times the salary rounded up to the next higher thousand; up to $5,000 per year for health care expenses not covered by basic insurance; a maximum of $5,000 per year for tax preparation and financial planning services, and initiation fees and monthly dues for selected clubs, as determined by the chancellor for the other administrators, and as determined by the chair of the trustees for the chancellor.

Commenting on the board’s actions, University Senate President Irene Hanson Frieze said, “First, in looking at the Chancellor’s salary, we should keep in mind that he has been doing a wonderful job. I find that not only do faculty feel this, but administrators and state legislators do as well. So, it makes sense that he should be highly paid when compared to other chief administrators at top public universities. His raise this year is quite modest.”

Under Nordenberg’s leadership, Pitt has made substantial progress in attracting high-quality students, attaining research funding and providing salary raises for employees, Frieze added.

“At the same time, as we look at overall compensation of our top administrators, we need to keep in mind that data indicate that top executive salaries in the U.S. are increasingly at higher multiples of worker salaries than in other nations” at a time when the gap between rich and poor is accelerating, she said. “One consequence of this is that higher education is not economically feasible for too many people. Pitt does everything it can to try to help with economic aid, but this does not solve the basic problem.

“It is hard for one institution to do anything about the trend for high administrative and executive salaries, relative to those of more junior members of the organization,” Frieze continued. “We do need to speak out about this general pattern in the United States and do all we can at our institution to help our lowest paid staff and to improve our scholarships for students.”

Staff Association Council President Rich Colwell said, “The Staff Association Council acknowledges the great leadership of Chancellor Nordenberg. The University has made great strides under his governance. We believe that all individuals who contribute to the mission of the University of Pittsburgh should be appropriately compensated, including all staff members who make valuable contributions to the success of the institution at all levels.”

Colwell continued, “Staff are delighted that the University is in such a strong financial position. The percentage increases of the administrative officers, in that they are above the 3 percent typical of staff raises, is a possible indicator that the percentage in raises for staff will be higher in the near future.”

—Peter Hart

Filed under: Feature,Volume 38 Issue 8

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