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UC Regents Act to Tighten Oversight of Managers' Pay

With the university's executive compensation practices under fire, the panel considers revising the salary structure for its top 300 employees.

January 19, 2006|Rebecca Trounson | Times Staff Writer

SAN DIEGO — University of California regents, stung by recent criticism from legislators and others for extravagance and inconsistencies in the university's executive compensation practices, took steps Wednesday to increase their oversight and begin to standardize salary levels for top UC managers.

As the regents began a two-day meeting at UC San Diego, they gave preliminary approval to a plan that would allow them to keep a closer eye on severance agreements given to departing executives. The new policy, if approved by the full board today, would require all such packages worth $100,000 or more to be approved by the regents.

Legislators this week authorized an audit of UC compensation practices after recent media reports that the public university has quietly spent millions on bonuses, moving expenses and stipends for top administrators, even as it has repeatedly raised student fees. Several legislative committees plan to hold hearings on the issue this spring.

The Board of Regents is also considering a plan to revise the salary structure for about 300 top UC employees. Under the current system, regents must approve salaries for those earning more than $168,000 a year. UC officials say that procedure is inefficient and cumbersome.

The new proposal would establish salary ranges, and the UC president would have the authority to approve pay increases within those ranges. In the highest category -- which UC officials said does not currently include any employee -- the annual salary would range from about $500,000 to a little less than $800,000.

Under the new policy, regents would still be required to approve salary increases that were considered above average or higher than the range for the position and would receive a report -- at least once a year -- on the nearly 300 executive salaries.

UC officials have largely defended their compensation practices, saying the spending is necessary to attract and keep the best administrators. They have said, however, that the university needs to do a better job of explaining the issue.

But union representatives and other critics say salaries for top UC officials are too high.

"It is deplorable that the regents show their lack of leadership and insensitivity to the needs of students and workers, the lower-paid workers," Amatullah Alaji-Sabrie, chief negotiator for the Coalition of University Employees, told the regents during a public comment period Wednesday. "On their backs, you're giving perks to the top-paid administrators."

On a more upbeat note, the regents were visited by Gov. Arnold Schwarzenegger, who recently announced a plan to eliminate a student fee increase that was scheduled to take effect this fall. Schwarzenegger, who is a regent because of his state position but was attending his first meeting of the governing board, was praised for that decision by students and regents alike.

"This fall, students won't have to pay a penny more ... to get an education in this wonderful institution," the governor said to applause from the audience at UC San Diego's Price Center. He urged the regents and others to work with him to ensure that the fee freeze is included when the Legislature approves the 2006-07 state budget later this year. He made no mention of the executive compensation issues.

For undergraduate students at state universities, Schwarzenegger proposes providing enough funding to eliminate the need for the approved 8% fee increases for the 2006-07 school year, saving Cal State undergraduates $204 and UC students $492. Currently, UC undergraduates pay $6,141 in mandatory, systemwide fees per year and CSU undergraduates pay $3,164. Students also pay fees imposed by each campus, as well as for room, board and books.

Students in graduate schools, teacher credentialing programs and law and medical schools also would be spared fee increases that range from 5% to 10%.

At the regents' meeting, Schwarzenegger was greeted warmly by Assembly Speaker Fabian Nunez (D-Los Angeles) -- who also is a member of the board -- and delivered a hug in return. The two said they would work together to try to ensure that the money to erase student fee increases for the 2006-07 school year was included in the final state budget.

Apparently unaware of formalities at the board meetings, the governor -- who is officially president of the panel -- drew laughter from the regents by suddenly calling on a student in the audience and inviting him to speak.

UC San Diego undergraduate Forest Borie, 22, asked Schwarzenegger about inequities in California schools; the governor agreed that such problems exist and congratulated the young man for his observations.

After leaving the meeting room, the governor also spoke briefly with a handful of other students, saying he was glad to have the opportunity to meet them. He told them that increased state revenues had allowed him to propose buying out the fee increases.

"Today was, for me, a very meaningful day to come in and say we are not going to increase the student fees," Schwarzenegger said. "That's great news, because we're helping. That's what government is supposed to do."

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