‘Price creep’ on chancellor pay extends from California to Carolina

This spring Chancellor Marye Anne Fox surprised folks at North Carolina State University and the UNC system when she announced that she had accepted the chancellorship at the University of California at San Diego.

It didn’t take long, however, for people at UNC to find an old foe to blame for Fox’s departure: low pay.

As it turns out, Fox was earning $248,225 at N.C. State, and also received a house and a car from the university. UCSD will pay her $350,000 and also provide her with a house and car.

That was enough to prompt the UNC Board of Governors to set up a review committee for June to ask if UNC underpays its chancellors. Allow me to venture a risky prediction and say the committee will answer, Yes.

As The News & Observer reported May 14, “Some board members worry that UNC chancellors could be hired away easily by other universities.” Board member Irvin Aldridge said that the chancellors are “totally underpaid.”

(Alert readers will note that the chancellor-underpayment argument is remarkably similar to the faculty-underpayment argument that recurs whenever a star faculty member is recruited away elsewhere — even though “the standing of top-rung professors, their bankable asset, depends upon what they write, not how they teach,” and that they therefore “have only modest teaching responsibilities,” as David Kirp noted in The New York Times Oct. 27, 2003. It also bears similarity to the administrator-underpayment argument that surfaces occasionally.)

Still, there is enough reason to doubt whether salary concerns really were the motivating factor driving Fox out of Raleigh and into San Diego. Key to this is purchasing power. Any sensible person considering a move from one area of the country to take a job in another would want to know how the new salary compared with the old. You wouldn’t take the same salary in downtown Manhattan that you have in Raleigh, for example, because everyone knows the cost of living in Manhattan is markedly higher than in Raleigh. A dollar in Manhattan has far lower purchasing power than a dollar in Raleigh.

What about San Diego and Raleigh? Well, according to cost of living data for San Diego and Raleigh published in the ACCRA Cost of Living Index, Third Quarter 2003, the cost of living in San Diego is much higher than it is in Raleigh. In fact, it’s so much higher that Marye Anne Fox’s purchasing power under her Raleigh salary ($256,696) is slightly higher than that under her new one in San Diego ($253,623).

This suggests that salary concerns might not be the sole motivating factor for Fox’s decision to leave. Other factors would, of course, be known to Fox. It’s certainly worth speculating that Fox’s run-ins with N.C. State administrators and the censure vote she received last year from the Faculty Senate played a role. But such speculation tends to testify against instituting large pay increases for executives, lean budget year or not.

While UNC board members fret that they’re underpaying chancellors, they’re only a step behind UC officials. And if you think the UNC budget is in a bind (“cut to the bone” and all that), have you paid attention to the train wreck of the UC budget? Nevertheless, UC folks are busy recruiting top university officials with much larger salaries than their predecessors’. Just as UNC officials are planning to do.

Fox will earn $70,000 a year more than the previous UCSD chancellor. The UC just hired former UC-Santa Cruz Chancellor M.R.C. Greenwood as system provost, and Greenwood will earn nearly $100,000 more than the previous provost. With the chancellorship open at UCSC as well as UC-Berkeley, the San Francisco Chronicle of April 22 reported, “observers expect the trend to continue,” which could start the “domino effect” of boosting top administrators’ salaries even during UC’s “most severe budget shortfall in years.”

UC officials basically blame “market realities” for hundred-thousand-dollar salary hikes.

Speaking of which, the N&O reported April 17 that the UNC system could be offering up to $411,429 for the next N.C. State chancellor. That would exceed Fox’s salary by over $163,000. One has to ask, when do market realities take a backseat to good, old-fashioned, university extravagance?

The N&O also reported that the search committee for a new chancellor at N.C. State “is expected to have a budget of $150,000 to $200,000.” That means that the minimum that UNC will spend on the search for the next N.C. State chancellor is what the previous chancellor, Larry K. Monteith, earned nine short years ago.

And that’s just to find someone; that’s not to “install” the new chancellor. UNC-Wilmington spent $100,000 on a lavish ceremony to install Rosemary DePaolo as chancellor there — a one-day amount that exceeded what the position was worth the whole year of 1993.

The upshot of all this is that UC officials cited market forces and “price creep” when they hired Marye Anne Fox at $100,000 more than her current salary — which is $70,000 more than what that position paid. UNC folks are now sounded remarkably like UC folks, offering the next chancellor potentially $163,000 more than what Fox was just earning.

All this when UNC budgets are cut to the bone with only the “essentials” left. Right. And if “global warming” happened as fast as chancellor “price creep,” the movie “The Day After Tomorrow” would be airing not in theaters, but on The History Channel as “The Disaster Back Then.”