Blade Editorial on Bonus Scandal

Published September 06, 2009 in The Toledo Blade

An 'F' in public policy

THE revelation that top officials at the University of Toledo are being paid hundreds of thousands of dollars in bonuses on top of their generous salaries was unseemly at best, especially in light of continuing cutbacks, layoffs, and President Lloyd Jacob's plan to have all employees take one or two days off without pay.

Dr. Jacobs is not responsible for the ailing economy that devastated state revenues, causing lawmakers in Columbus to slash funding to higher education. UT's decision in April to lay off nearly 100 workers and not fill 200 vacant positions was driven by a $16 million deficit. In like manner, state cutbacks are responsible for the furloughs, more layoffs, and program cuts the university president announced last month.

Times, as they say, are tough all over.

But that makes this a particularly inopportune time to be handing out bonuses to high-ranking administrators. It simply looks bad to lay off secretaries, janitors, and faculty after having cut checks worth some $200,000 to Dr. Jeffrey Gold, UT's provost and vice president for health affairs and medical college dean, who already is paid about $500,000 per year for his work as a doctor and university administrator.

Dr. Jacobs has defended the practice, saying that compensating employees at market value (which seems often to mean writing bonuses into contracts) keeps the university competitive for top talent.

It may be that's the way the system works - it could even be that UT administrators are paid less than their peers at other universities - but that's not how blue-collar workers struggling to pay their children's college tuition (set to increase 3.5 percent for the spring semester) are going to see it.

It doesn't matter to them that "only" $50,000 of the payment to Dr. Gold was an actual bonus while the other $150,000 was a "longevity payment" (essentially, pay for not chasing a higher salary elsewhere for the term of his contract). To people earning $40,000 - if they have jobs at all - the six-figure salaries plus benefits, longevity payments, and bonuses of university officials are cut from the same cloth as the hugely inflated compensation packages of Wall Street executives. To them, top administrators getting bonuses while other workers get pink-slipped is nothing but greed.

By opening UT's checkbook so unapologetically, the board of trustees and Dr. Jacobs - who banked his own $150,000 longevity payment last year and is in line for two more $150,000 paydays if he stays until 2013 - are being remarkably insensitive to the economic climate in northwest Ohio and the pain being felt by thousands of area residents.

It appears these leaders in public education could use a refresher course in public policy, not to mention a strong dose of humility, considering who ultimately pays the bills for the grand and growing operation at UT.

The Divine Bonus

Why a blog?

As we enter the post furlough period I believe it necessary to explain how important this blog is to the well-being of our institution.

1. It provides necessary commentary in immediate terms.

2. It is not controlled by any administrator.

3. It actually constitutes free speech for the faculty.

4. While the administration can claim increased enrollment cancelled the furloughs, it is much more likely that public disclosure and immediate response were the causes. No one had to wait for an A & S Council or Faculty Senate Meeting. Also those groups have department chairs as members. This blog comes from the faculty.

5. Ask yourself who might still be dean of A & S if this blog were not present?

6. For those who think the blog is a bit acrimonious, I would reply that we are not in the business of being nice; we are in the business of trying to save the liberal arts for future generations of UT students. We are in the business of trying to remain a university and not a community college.

Update - Holiday furlough cancelled

Article published September 05, 2009
University of Toledo calls off furlough plan over holidays
Jacobs cites enrollment; faculty note bonus fury

By MEGHAN GILBERT
BLADE STAFF WRITER

After making plans to shut down the university around the holidays, the University of Toledo now says it will not require unpaid furlough days of its employees this year.

The reversal occurs after a public outcry over what some call excessive administrative bonuses, but UT President Lloyd Jacobs said the change is because enrollment is higher than expected.

UT had anticipated having more students than the 22,336 counted last fall, but apparently not as many as the 23,000 who Dr. Jacobs said are actually on campus now.

Official enrollment numbers will be released Tuesday.

“It is connected overall to our budgetary circumstance because the more students we have, the better we are,” Dr. Jacobs said.

“They make us better not only because they bring new ideas and fresh minds, but they also improve our budgetary situation,” he said.

UT receives about $5,000 in state funding per full-time undergraduate student.

Dr. Jacobs announced the cancellation of the fall furlough plan during a taping Friday of the “A Presidential Perspective” video posted weekly on UT’s Web site.

The furloughs were planned to save UT $1.3 million and address part of an $8 million shortfall caused by reductions in state funding.

While UT will not need the furloughs during the holidays, it’s likely that furloughs will be needed in the future and university officials will continue planning efforts on the best way to implement them, Dr. Jacobs said.

The furlough program was nixed rather than the planned program cuts or tuition increase in the spring because furloughs are a one-time cost savings, Dr. Jacobs said.

He said he was “pleased” and “delighted” to be able to postpone the furloughs.

But faculty members do not believe the reversal was solely based on a larger-than-expected student body.

“It’s hard to believe that all the attention to the bonuses hasn’t created this,” said Terry Cluse-Tolar, an associate professor of social work and chairman of the department.

While the form of the furlough idea has changed several times during the budget discussions, scrapping it altogether now is “curious timing,” she said.

A recent newsletter from the faculty union, the UT American Association of University Professors, drew attention to the extra compensation of administrators while UT instituted layoffs and announced furloughs of its employees.

A review by The Blade revealed the university paid out nearly $570,000 in administrative bonuses last school year and $1.5 million during the last four years.

Dr. Jacobs has defended the bonuses, saying they are part of the total compensation of the administrators, which is based on market value adjusted for performance.

Using the longevity and performance bonus method rather than incorporating the payments into their salaries promotes continuity and encourages good performance, he said.

A lengthy letter to Dr. Jacobs from Lawrence Anderson-Huang, a professor of physics and astronomy at UT, which questions the sense of the furlough plan and bonuses for doing their jobs, has been widely circulated around campus.

He said he was upset about the situation and the administration again making sweeping changes at the spur of the moment.

“You seem like fish flopping out of the water. These things keep happening over and over without respite,” he wrote.

But given that practice, it’s not a total shock that the furlough program is now being revisited, Mr. Anderson-Huang said.

“I kind of got the idea from the way things were treated that our administration has the same view of faculty that the general public does, that the only work we do is when we are in the classroom and that is certainly far from the truth,” he said.

Mr. Anderson-Huang and other faculty members have said they are glad the administrative pay and bonuses have received attention. If administrators need bonuses to stay, they are more committed to the money than UT, he said.

“In these times, those types of awards are a little outlandish,” Mr. Anderson-Huang said.

http://www.toledoblade.com/apps/pbcs.dll/article?AID=/20090905/NEWS16/909059998

Initial Blade report - possibly no furloughs

Article published September 04, 2009
More UT students could mean no furloughs

BLADE STAFF

The University of Toledo could scrap the planned furlough program because of a larger than expected fall enrollment.

UT had planned to require at least one day unpaid furlough for all employees to trim $1.3 million of an $8 million budget deficit caused by reductions in state funding.

But anticipated fall enrollment numbers around 23,000 students — the official count will be available Tuesday — might bring in enough money to postpone the furloughs.

UT is still crunching the numbers and the UT Board of Trustees would need to approve the budget amendment.

The university's 2008 enrollment was 22,336 students.

http://www.toledoblade.com/apps/pbcs.dll/article?AID=/20090904/NEWS04/309049996

UT Enters the Dark Age

This UTNews online message was posted to the campus community in advance of the Labor Day holiday:

“'Employees Encouraged To Power Down Areas for Holiday Weekend'
(September 3rd, 2009).

In line with the University’s commitment to sustainability and energy conservation, employees are asked to turn off all appliances and machines possible for the Labor Day holiday weekend. These include computers, printers, copiers, lights and coffeemakers. This simple act can help reduce waste and save the University money. ..."

The following comment was posted in response, and is copied to this site:

“This “green” message is well-intended, but just another example of the lack of understanding this present administration has about university academic campus culture. Weekends and even holidays on our university campus are intuitively understood by our most idealistic, optimistic, diligent students and tenure-track and tenured faculty to be learning and research opportunities. We expect campus doors to be open and inviting, with lights and power and heat in the winter and air conditioning in the summer, all available so we can accomplish our academic missions and objectives. Students need access to campus library and computer labs, and faculty members need access to their offices and research materials within them, as well as to their computers. Here is the cold reality: This UT administration does not yet consider the Bancroft campus of this university to be a 24/7 operation like the Heath Services campus, and takes every opportunity to cut costs of the Bancroft campus university academic operation at night, on weekends and during holidays, making it increasingly difficult if not impossible to nurture academic excellence on its campus. When and if ever the Jacobs administration wakes up to its significant unmet responsibilities to promote academic excellence at the University of Toledo, then they will become responsible to their neglected mission, and will strive to become a 24/7 university and grow rapidly in reputation statewide and nationwide, as well as internationally. At present the Jacobs administration demonstrates no sincere inclination to improve academic excellence on the Bancroft Campus. Its day to day operations of the Bancroft campus over the past three years have been regressive rather than progressive. We remain a fourth-tier institution according to the national rankings while Bowling Green University has leaped into the third tier over the same span. We remain bogged down by a seemingly anti-intellectual maladministration and an incompetent leadership that simply does not understand or care what a state public institution of higher eduction is supposed to achieve academically in order to fulfill its promise as a valuable public service that parents, students, faculty and all Ohio taxpayers can be proud of. Turn off the lights on the weekends and holidays? This is a metapor for mediocrity. Welcome to the University of Toledo. The quest for excellence abandoned. Watch your step as your re-enter the dark ages.”

The New University Communication Model