Incensed over tuition increases, Indiana budget leaders summoned the presidents of the state’s public universities last September and demanded to know why most of their institutions exceeded a recommendation to limit tuition increases. In retrospect, they should have been asking about executive compensation packages.
Purdue University President France Córdova, who told lawmakers last year the university would have no problem meeting expenses with a 2.5 percent tuition increase, knew at the time that her contract wouldn’t be renewed. She also knew she was in line for an exit package that would have attracted the lawmakers’ wrath.
I’m offended, said Rep. Jeff Espich, the Uniondale Republican who asked some of the toughest questions about university tuition at last year’s state budget meetings. Frankly, she was a failure. I don’t know of any legislator who appreciated her. She was not cooperative; she was not helpful. Companies seem to give their CEOs who fail great buyouts.
Under terms of the separation agreement signed July 1, 2011, but approved publicly just last week, Córdova will receive:
Full salary of $475,997 for a one-year sabbatical, amounting to a 2.2 percent increase over 2011-12.
A retention bonus of $350,000 for staying until July 15 of this year, plus an additional $150,000 for meeting performance expectations this past year.
Full health-insurance benefits provided for one year, with an option for Córdova and her husband to stay on the university’s program without premium coverage.
A budget to set up an office in a mutually agreeable location, with related expenses reimbursed and clerical support for a year, or until the former president is employed full time.
The lucrative package presents a stark contrast to the austerity program Córdova promised lawmakers last September. While it represents a fraction of the university’s budget overall, it certainly casts Purdue’s eagerness to hold tuition in check in an unflattering light. What sort of compensation deal has been negotiated with incoming president and current Gov. Mitch Daniels?
Córdova and her husband are relocating to Santa Fe, N.M., where she will become a visiting faculty member at the non-profit Santa Fe Institute. She also is chairwoman of the Smithsonian Institution’s Board of Regents and a member of the National Science Board.
Keith Krach, the board of trustees president, defended Córdova’s separation agreement, insisting it wasn’t unusual.
But Córdova’s predecessor, Martin Jischke, was paid a $400,000 retention bonus after seven years. He continues to live in Lafayette. Former Indiana University president Adam Herbert left Bloomington in 2007 with a 10-year consulting agreement worth $30,000 a year.
By those measures, Córdova’s deal seems more than generous. Her five-year tenure as president at Purdue – the third-shortest in the university’s history – saw tuition increase by 33 percent, to $9,900 for in-state students next semester. The six-year graduation rate for baccalaureates remains among the lowest of Purdue’s peer institutions at 70 percent.
I’ve been trying to get at the universities for a number of years now, said Espich, who is not seeking re-election after 40 years in the Indiana House. The price of education for the kids has gone up and up. The utilization of classroom space is pathetic, along with the teaching loads. This is just another example of their disregard – it’s offensive to the average person.
Espich said he wished he had known about Córdova’s exit package last year.
It would have been a strong bargaining point, he said. It’s just another example of their inefficiency and proof they live in an ivory-tower world. One of my greater regrets of leaving is to not be able to follow through on this.
With declining state support for public universities, legislators have increasingly less room to criticize university spending. But questioning the generous backroom deals struck by university trustees and presidents seems like a worthy line of questioning for lawmakers to continue in Espich’s absence.