The Chronicle of Higher Education

Calendar Year 2018 Chief Executive Compensation Survey

Frequently Asked Questions

If you have any questions not answered here, please email survey@chronicle.com.

For a printable PDF of this FAQ, click here: bit.ly/FAQ-PDF

What time period is The Chronicle requesting data for?
We are collecting compensation data earned over the course the 2018 CALENDAR YEAR. We are NO LONGER collecting compensation data earned across a fiscal year.

Am I legally required to respond to this survey?
Compensation data for public employees is public information under state public records laws and this serves as a public records request under your state’s applicable statute.

How is this year’s survey different from prior years’?
— We are collecting compensation data earned over the course the 2018 calendar year. We are NO LONGER collecting compensation data earned across a fiscal year.
— For each employee, submit values that reflect all of the compensation earned by this person during the calendar year, regardless of role. You will be able to provide notes regarding roles or dates when you are prompted to comment.
— We will only request that total actual reportable compensation be reported by your institution for the three highest-paid employees (excluding CEOs and former CEOs).
— For CEO and former CEOs, we will now collect compensation data if these individuals received compensation from your institution or from related, affiliated, allied, or associated organizations via non-payroll means. For instance, if a former CEO was awarded a contract to consult or fundraise for your institution, and that compensation was NOT reported on their W-2, you will be prompted to provide information about that contract-related compensation disbursed during the calendar year.
— Excluding benefits for housing, vehicle, personal services, or health and social clubs, we are NOT requesting you provide us with information about the additional fringe benefits received by your CEO.

How do I determine if an organization is related to, supporting of, affiliated, allied, or associated with my institution?
The IRS defines a “related organization” as an organization that stands as a“a parent/subsidiary relationship, brother/sister relationship, sponsoring organization of or contributing employer to a VEBA, or supporting/supported organization relationship.” Within a Form 990 for a non-profit “related” to a public institution, the public institution would be reported in Schedule R, Part II. As an example, observe the U. of South Florida and its related foundation: bit.ly/USF-F990

In states like Florida, direct-support organizations are state-sanctioned not-for-profits that “receive, hold, invest, and administer property” for the benefit of the associated university.

Practically, The Chronicle means for “related, supporting, affiliated, allied, or associated organizations” to capture all entities whose missions are to support institutions of higher education — that being an individual institution, or a distinct cohort of institutions (all University of Texas campuses, for instance).

We are NOT requesting you provide compensation earned by your institution’s employees from corporations like ESPN or Nike for services rendered. NOR are we requesting you provide us the compensation earned by your CEO for sitting on the board of a publicly traded company.

To some extent, we are requesting that you consider the public perception of nondisclosure, and use your best judgement. In 2013, James Ramsey, then-president of the U. of Louisville, earned $278,656 in base compensation from the University of Louisville Foundation. While the University of Louisville Foundation was not “related” to the University of Louisville by the IRS’s definition (see bit.ly/UofL-F990), the mission of the Foundation is to “support the academic, scholarly, research and community engagement activities of the University of Louisville.”

Given this circumstance, we would request that the U. of Louisville include that value of base compensation from the Foundation in its disclosure of compensation to The Chronicle. Should your university or its related, supporting, affiliated, allied, or associated organizations operate in a similar manner, we request similar disclosures.

Compensation, generally

What if an employee didn’t serve in the same role for the entirety of the calendar year?
Report all of the requested compensation earned by this individual during the calendar year, regardless of their role. If he or she served in a role other than CEO during the calendar year, indicate that when you are prompted to provide a comment.

My CEO donated some of their compensation back to the institution. Can I subtract that amount from the actual amount of compensation they earned and report that adjusted value in the survey?
No.

What is reportable compensation?
Reportable compensation generally means compensation reported in Box 1 or 5 (whichever amount is greater) of an employee’s Form W-2. In tandem with that definition, reportable can include compensation that was paid or payable during the calendar year. Even if reportable compensation is deferred by an employee, it is still considered reportable to the IRS.

What if I don’t know the value of one of the subtypes of compensation you list below?
Use your best judgement. For instance, we request that when you report the value of nontaxable benefits earned by your CEO, that you you include within that sum the value of any nontaxable housing benefits. But suppose your university purchased a president’s residence 50 years ago (and the CEO uses it to this day). However, the university no longer knows what the value of that housing benefit is. In that case, if it is truly unobtainable, or if it would be prohibitively time-intensive to determine, you do not need to have that value factored into your final calculation of nontaxable benefits for your CEO(s).

What was the basis for The Chronicle categorizing certain compensation under the umbrellas of base, bonus, remaining other reportable compensation, nontaxable benefits, etc.?
The Chronicle relied on collection forms used by the Indiana University system (bit.ly/IUTemplate) and Conference USA (bit.ly/C-USATemplate) to collect compensation data. Additionally, The Chronicle relied on a comprehensive analysis of the Form 990 prepared by the law firm Venable LLP (bit.ly/VenableReport).

I think The Chronicle is asking me to double-count a specific subtype of compensation. What should I do?
If you believe this survey is requesting you you to double-count a particular amount/value of compensation, email survey@chronicle.com and we will address that concern. This survey should only prompt you to report any dollar of compensation once, though you do have the option to voluntarily spotlight particular amounts of compensation in the comments form when prompted.

Base compensation

How do I calculate this type of compensation?

Bonus compensation

How do I calculate this type of compensation?

Severance and similar payments

How do I calculate this type of compensation?

What does this type of payout look like?
A CEO’s contract may stipulate that the executive is owed a certain amount if he or she steps down before that contract ends, or an executive may accept a payout as part of a separation agreement.

Formerly deferred compensation — reportable (payable, paid, or employee deferred) in the calendar year

How do I calculate this type of compensation?

I’m still confused by what is considered formerly deferred compensation — reportable in calendar year, and deferred compensation — set aside.
If a CEO’s contract specified that he or she should earn $50,000 per year in deferred compensation (set aside) in CY15, FY16, and CY17, and that those three years of accumulated deferred compensation became “reportable” to the IRS in calendar year 2018, the answer to this question would be $150,000.

Remaining reportable actual compensation

What’s included in that?

Deferred/accrued compensation, set aside

How do I calculate this type of compensation?

How is this different from formerly deferred compensation — reportable (payable, paid, or employee deferred) in the calendar year?
This should not include compensation put into standard retirement plans open to all employees. This figure also should not include any amounts reported in the previous “formerly deferred compensation” question.

As an example, let’s imagine a contract specified that if a CEO remained with the university for the entirety of a calendar year, $50,000 would be deposited in a deferred compensation plan for this CEO. Three deposits of $50,000 each were made in calendar years 2016, 2017 and 2018. Across all three years, this compensation was not actually released to the CEO, and as such was not reportable to the IRS. But the contract states that, if the CEO is still with the university in 2019, then the the aggregate $150,000 in compensation will be released to the CEO, at which point it will become reportable to the IRS.

In this case, report the value of the deposit made to the deferred compensation plan in calendar year 2018, that being $50,000.

Also, any money set aside for a Supplemental Executive Retirement Plan during the calendar year would be included in the submitted value here.

Other retirement compensation

How do I calculate this type of compensation?

Does retirement compensation include money that the president contributed to the plan?
This should include compensation contributed only by your institution, an institution-related organization, or the state to any 401(k), state pension plan, or other retirement plan that is available to all university employees. This amount should not include the employee’s contributions into the same plan.

Nontaxable benefits

How do I calculate the value of benefits?

What are nontaxable benefits?
Nontaxable benefits are benefits specifically excluded from taxation under the Internal Revenue Code.

Nontaxable benefits typically refer to those benefits which are available to all employees, but are not taxed by the federal government. However, in certain circumstances, a benefit offered to an employee or specific group of employees may be considered a nontaxable benefit.

Employer contributions for nontaxable benefits include, but are not limited to, health insurance, medical reimbursement programs, life insurance, disability benefits, long-term care insurance, and certain education assistance.

What if I don’t know the value of a particular subtype of nontaxable benefit you listed?
Use your best judgement. For instance, we request when you report the value of nontaxable benefits earned by your CEO, that you you include within that sum the value of any nontaxable housing benefits. But suppose your university purchased a president’s residence 50 years ago (which the CEO uses it to this day), and the university no longer knows what the value of that housing benefit. In that case, if it is truly unobtainable, or if it would be too time-intensive to determine, you do not need to have that value factored into your final calculation of nontaxable benefits/compensation for your CEO(s).

Non-payroll compensation

Why are you requesting for this information?
As part of the Tax Cuts and Jobs Act of 2017, private, not-for-profit universities will now be taxed on annual compensation in excess of $1 million that is paid to the five highest-earning employees at that institution. As a result, there is speculation that highly compensated individuals at these private universities will form LLCs so their institutions can avoid that tax hit. For some prognosticating on the issue, see the Provost of the University of San Francisco: bit.ly/HellerThoughts.

Congress has not yet expanded this millionaires’ tax to include public institutions and the people they employee. However, for parity with private, not-for-profit institutions, The Chronicle has decided to collect this information for CEOs and former CEOs of public institutions that participate in its executive compensation project.

Additionally, The Chronicle is aware of at least one instance in which a former CEO earned a significant amount of non-payroll compensation from the public university he had previously led. Bernard Machen, the former CEO at the U. of Florida, is set to earn significant amounts of compensation for relinquishing his tenure and agreeing to a non-compete arrangement with UF (bit.ly/ManchenContract). A UF representative confirmed that these payments have been and will be made via the university’s vendor payment system (bit.ly/UFConfirmation).

To be clear, UF did nothing surreptitious here, and The Chronicle thanks them for their transparency and guidance on the issue on non-payroll compensation.

What is non-payroll compensation?
Non-payroll compensation refers to compensation released to an employee as the result of a business transaction facilitated through a contractor-contractee relationship, rather than an employee-employer relationship. Non-payroll compensation would not be captured on the W-2. Potential non-payroll compensation might encompass services provided by a CEO (or former CEO) for consulting, fundraising or advising to relevant parties. It might also include payment in return for acts like the relinquishing of tenure, or the signing of a non-compete agreement.

What else should I consider when determining the value of non-payroll compensation during a calendar year?
In addition to compensation released to a CEO (or former CEO) personally, also report the non-payroll compensation released to any organization in which the CEO (or former CEO) has a controlling stake, and for which it would be reasonable to assume he or she will share in the revenues earned by that organization. Practically, this would refer to a business transaction between your institution (or institution-related organizations) and, for instance, an LLC set up to accept payments for services rendered by the CEO (or former CEO).

What do I NOT need to consider when I calculate the total value of this type non-payroll compensation?
DO NOT provide the value of compensation earned from business transactions between your CEO (or former CEO) and non-institutional actors. We are NOT requesting compensation earned by your institution’s employees from corporations like ESPN or Nike for services rendered by these employees to those companies. NOR are we requesting you provide us the compensation earned by your CEO (or former CEO) for sitting on the board of a publicly-traded company.

DO NOT report the value of business transactions of any sort of compensation dispersed by your institution (or institution-related organizations) to singular family members or relatives of the CEO (or former CEO) for services rendered by these individuals.

Anything else I should know about non-payroll compensation?
For business transaction in which disbursements to a CEO or former CEO occurred or will occur over multiple years, report only the total value of payments that were dispersed during the 2018 calendar year.

In the comment box, disclose the full multi-year value of the contract.

Former CEOs

What former CEOs is The Chronicle requesting compensation information for?
The Chronicle requests compensation data for persons who:
1. DID serve as a permanent (not interim or acting) CEO in any previous calendar year;
2. and who DID NOT serve as CEO at any time during the calendar year 2018;
3. and who earned any reportable compensation from the institution or related, supporting, affiliated, allied, or associated organizations in the 2018 calendar year.

Do not submit compensation data for a former CEO who only served in an interim capacity, and who never was appointed to the role permanently.

Report all of the requested actual compensation earned by this individual during the calendar year, regardless of their role. You will be able to provide notes regarding roles or dates when you are prompted to comment.

Three highest-paid employees

How do I determine the three highest-paid employees at my institution?

For a campus: Include the three highest-paid employees at your university or within your district. This should include administrators, academics, athletic-department employees, coaches, medical-campus employees, and physicians.

For a university system or state higher-education system: Include the three highest-paid administrative employees within the chancellor/system’s office. Do NOT provide the three highest-paid outside the system office, who are employed on campuses within the system.

For campuses that serve as both a system office and campus: Include the three highest-paid employees at your main campus. This should include administrators, academics, athletic-department employees, coaches, medical-campus employees, and physicians.

To determine who are the highest-paid employees, include all compensation provided by the university or university-affiliated organizations, such as an athletics association, university/alumni foundation, or a university medical system. Do not include compensation paid by private, non-university-affiliated companies, such as a physician’s private practice or broadcast fees paid to a coach by a private media company.

What do I need to report:
For this section, submit the value of total actual reportable compensation earned by the employee during the 2018 calendar year from .

To determine who are the highest-paid employees, include all compensation provided by the university or institution-related organizations, such as an athletics association, university/alumni foundation or a university medical system.

Do NOT factor in compensation paid by private, non-institution-affiliated companies, such as a physician’s private practice or broadcast fees paid to a coach by a private media company.

If any of the other highly paid employees received supplemental reportable compensation (e.g.: radio and TV compensation funded by the university or a university-related organization), include this in the sum of total reportable compensation that you provide. Additionally, note this in the comment form.

Methodology

Whom does this survey go to?
1) All public doctoral universities (non-military service) in the United States;

2) All state college and university systems or governing boards that:

a) span at least three campuses;
b) or have a least 50,000 total students in the same academic year as the compensation data being reported; and
c) do not include systems, state boards, or administrative departments that oversee purely technical or community colleges.

3) This analysis does not include Puerto Rico.