Minutes after a consultant delivered a report showing University of Louisville President James Ramsey is paid “at or above the market,” the Board of Trustees’ Compensation Committee unanimously recommended on Monday a 6 percent merit raise in his base pay and a bonus from the U of L Foundation equal to 25 percent of his base salary.
The vote, which is before the full board later this week, came at the end of a meeting in which Ramsey devoted nearly an hour to highlighting his most recent accomplishments during 13 years as the university’s chief executive. His presentation, part of a review of benchmarks set by the board to judge Ramsey’s performance, included rises in graduation rates, increases in fundraising, and multimillion-dollar land development deals that expand the campuses’ footprint and the university’s revenue base.
According to the compensation study, conducted by Chicago firm Verisight, Ramsey is projected to receive $1.1 million in pay this year. That includes base salaries from both the university and the U of L Foundation, a $156,000 bonus, and nearly $300,000 in deferred compensation. However, it does not include perks provided to Ramsey, such as a $12,000 annual car allowance for his wife, a residence and tax gross-up payments, which cover taxes he must pay on certain benefits.
As IL reported in February, Ramsey and top U of L executives received millions in deferred compensation in the 2012-13 fiscal year, including $2.4 million for Ramsey alone. That pay was part of an incentives package that accumulated over time and was designed to keep him at the university, officials said. Last year, Ramsey received $944,512 in deferred compensation from the Foundation, according to an IRS 990 form.
The Courier-Journal reported Monday that Ramsey’s total pay for 2014 was more than $1.6 million.
“That means we’ve had tremendous success,” said trustee Bob Benson on Monday. “That means that he, in the 13 years that he and his team have served this university, have brought us along.”
Verisight analyzed information on 26 universities — eight of which are also members of the Atlantic Coast Conference — from the Chronicle of Higher Education and the College and University Professional Association, as well as data it gathered from IRS 990 forms. Its analysis shows Ramsey’s compensation is 160 percent of the median according to the Chronicle’s data, and 180 percent of the median according to its own review of 990 forms, which do not provide a comprehensive view.
Ramsey’s contract provides annual contributions of $250,000 in deferred compensation until 2020. That pay, which comes from the Foundation, a separate fundraising entity that manages $1.1 billion in assets, has gotten the attention of some trustees, who have called for more transparency in Foundation dealings. Trustee Steve Wilson has said publicly he was not aware of the deferred compensation payments.
Verisight Principal Mark Reilly, who gave the presentation Monday, said using deferred compensation to retain a university president is “a common practice” and that roughly half of the schools analyzed in the report offer it.
The university paid roughly $23,000 for the study, in part as an answer to public criticism of Ramsey’s pay. A report by the Chronicle of Higher Education last month said Ramsey is the 26th-highest-paid president of a public university in the U.S.
Trustee Ron Butt said Ramsey deserves every penny.
“We’re looking at an all-star president,” he said. “We have a prime, superstar, all-star team.”
The study and recommendation from the trustee committee are unlikely to quiet discussion of executive pay at U of L. State Auditor Adam Edelen announced late last month he would launch a review of the Foundation and the Board of Trustees, seeking to determine whether there is effective oversight of both the Foundation and the university’s administration.