Harvard’s tax returns for the fiscal year ending June 30, 2008, detail over $4 million in compensation for top administrators, a figure likely to draw close scrutiny over the coming months, as the University implements deep budget cuts.
According to the tax filings, University President Drew G. Faust took home $775,043 in salaries and benefits her first full year on the job, with $640,000 in cash compensation, $81,304 in moving and other expenses, and $53,739 in benefits. It is the first time Faust’s compensation information has been made available; University spokesman John D. Longbrake declined to release her salary in her previous post as dean of the Radcliffe Institute for Advanced Study.
Though there is precedent for raising a newly instated president’s compensation, the reported figure is only slightly higher—just over 2 percent (adjusted for inflation)—than the $758,034 former University President Lawrence H. Summers received in his last year in office.
The tax returns also reveal a small salary hike for University Provost Steven E. Hyman, who served in the same position under Summers, compared to his raise last year. One of the three oft-mentioned internal candidates for the presidency at the time, Hyman was asked to stay on as Faust’s deputy in 2007—and received a 19 percent boost in total compensation, from $479,819 to $570,265, the next year in today’s dollars.
Each of Harvard’s seven vice presidents drew between $250,000 to $418,000 in salaries, not including benefits.
As the University’s $36.9 billion endowment is projected to suffer a 30 percent loss by the end of June, Harvard administrators intend to freeze all non-union employees’ salaries for the next year.
But at a recent Town Hall meeting hosted by the Undergraduate Council, FAS Dean Michael D. Smith responded noncommittally to a student’s suggestion that administrators take salary cuts in the spirit of shouldering the burden of deep cutbacks across the University. The Faculty will need to close a $220 million deficit over the next two years, Smith said, but the range of budget cuts announced last week only account for $77 million in savings.
“We still have $143 million dollars to go,” Smith said. “Just cutting a few administrator salaries isn’t going to erase this deficit.”
And in recent interviews, Faust and Hyman—noting that the salary freeze also applies to administrators—similarly declined to say whether administrators would take compensation reductions.
While compensation costs for all employees comprise roughly half of the University’s operating budget, top administrators said that cuts in faculty salaries would be detrimental to the University’s academic mission.
Hyman said that it is important for Harvard both to remain competitive and to retain current faculty members lest peer institutions swoop in to lure away star faculty.
“I would be very worried about faculty salary cuts, because what we want to do is retain our very best faculty,” Hyman said.
But strong student sentiment over the past few weeks suggests that many students feel staff would disproportionately bear the brunt of budget cuts in the form of layoffs, while University management remains relatively untouched.
Leaders at other universities such as Stanford and several public universities have offered to reduce their own salaries as part of cost-cutting measures.
Stanford President John L. Hennessy announced last December that top administrators, including the university’s provost and seven school deans, will take an immediate voluntary 10 percent pay cut “in light of the extraordinary pressure on the university budget.”
It is unclear how much of an impact the symbolic measure will have on Stanford’s finances—the university’s endowment valued at $17 billion as of June 2008 is expected to suffer at least a 30 percent decline—but Hennessy earned roughly $700,000 in salary and benefits in fiscal year 2007 according to federal tax filings.
—Staff writer Athena Y. Jiang can be reached at firstname.lastname@example.org. —Staff writer June Q. Wu can be reached at email@example.com.