in Houston, Texas
26 UT System administrators, campus presidents may be in line for corporate-style incentive pay
Wednesday, Aug 22, 2012, 03:14PM CST
By Curt Olson

One year after approving a strategy to improve accountability and productivity in the University of Texas System, regents could authorize a corporate-style incentive pay plan for 26 UT System administrators and campus presidents.

After all, if higher education must operate like a business, pay them accordingly, right?

UT System Chancellor Francisco Cigarroa recommends that regents approve an incentive pay plan for the 15 campus presidents and 11 UT System administrators, giving them higher pay based on surpassing goals tied to saving money, research dollars, fundraising and graduation rates, the Austin American-Statesman reports. The plan is designed to gradually increase the percentage of their pay derived from performance goals. There’s no cap on that percentage.

While the UT System wouldn’t be the first university system in the nation to create such a pay plan, the proposal comes after reports this spring that Texas already has some of the highest-paid higher education leaders in the nation.

For the salary and total compensation of all higher ed administrators in Texas, read this report from the Legislative Budget Board.

Critics of higher education have targeted administrative bloat, the lack of productivity of tenured faculty, the record debt of about $1 trillion for college graduates nationally, and poor results in college student learning.

Would the bonus system do anything to address those criticisms? By one testing measure, UT Austin students do no better than their peers at other institutions by demonstrating no marked improvement between freshman and senior years, the Washington Post reported. Perhaps the 15 UT System campus presidents should have some measure of accountability for these results, as well as when learning outcomes improve.

Americans grew accustomed to well-paid corporate executives when times were good. If they make the company profitable, give them incentive pay.

However, Americans have witnessed some real head scratchers involving performance pay when companies received bailouts. One of the more famous ones in recent years was the controversy over bonuses paid to American International Group executives after the company crashed and received a taxpayer bailout.

So it might be worthwhile to put safeguards in this UT executive performance-pay plan if events don’t go as planned.

Contact Curt Olson at or 512-557-3800. Follow him on Twitter @olson_curt.

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Photo of UT's Main Building by flickr user ThisIsNotApril, used via a Creative Commons license.

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