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Breaking down the private funds that pay the KU chancellor’s salary

If the comments on this story and the interactions with the @LJW_KU Twitter account last week are any indication, many of you had some thoughts and feelings about last week's Kansas Board of Regents vote to award a pay increase to KU Chancellor Bernadette Gray-Little, along with the chief executives at the state's other public universities.

One important detail, amid declining state funding at KU, is that the $60,000 raise for Gray-Little will come entirely from private funds. That means the privately paid portion of the chancellor's salary is approaching the state fund-paid portion: About $272,000 will now came from state funds, with about $221,000 coming from private funds.

That left me with a question: What are those "private funds," exactly?

Well, they come from the KU Endowment Association, but it's a little more complicated than that.

First, some history. KU chancellors' salaries consisted entirely of state funds until 10 years ago, in 2003, when Chancellor Robert Hemenway began to receive an additional $50,000 per year thanks to a $1 million donation from a KU graduate. That donor, Charley Oswald, of Edina, Minn., also donated $1 million each to Kansas State and Wichita State universities.

Each donation created a professorship fund — like ones used to pay additional salary for distinguished professors — to bolster the salary of each university's chief executive.

Ten years later, that fund at KU provides about $70,000 of the chancellor's salary, said KU Endowment President Dale Seuferling. The rest of her salary — and all of the $60,000 increase the Regents approved last week — comes from the Endowment's Greater KU Fund, to which donors can make unrestricted gifts "to advance the university for a variety of purposes," Seuferling said.

A big majority of gifts to the Endowment come with specific instructions for their use, but some donors give money that the Endowment can use for any purpose at KU, with the approval of the Executive Committee of its Board of Trustees. Those go into the Greater KU Fund.

For the current fiscal year, which ends a week from today, donors have made 2,921 unrestricted gifts to the Endowment totaling about $2.3 million (an average of $800 per gift), according to numbers that Seuferling shared. The totals for restricted gifts are much higher: 80,576 gifts that add up to about $128.7 million, with an average gift of about $1,600.

For the coming year, around $151,000 of the chancellor's salary will come from the unrestricted fund. Over time, Seuferling said, the Regents have asked for privately funded increases to the chancellor's salary that exceed the amount available each year from the fund established by Oswald's donation. Those increases require approval from the Endowment's Executive Committee.

So, in sum, here's how the chancellor's salary will break down, roughly: $272,000 from state funds; $70,000 from the Endowment fund created to pay some of the chancellor's salary; and $151,000 from the Endowment's unrestricted fund.

Gray-Little's new base salary of $492,650, by the way, would rank 34th among public university leaders in the most recent survey on that subject published by the Chronicle of Higher Education (though that survey was for the 2012 fiscal year, and she'll make that salary in the 2014 fiscal year, so obviously other leaders' pay may have increased since then, as well). Her then-base pay of about $429,000 ranked 60th in the survey for that year. (Overall, she was the 86th highest-paid executive on the list, but that includes retirement and severance payouts, among other factors.)

The Regents said the raises for Gray-Little and the other leaders were designed to make their pay more competitive nationally, and this one would appear to do that.

I'm sorry if you didn't expect your Monday to include so much math. I'll stop throwing so many numbers at you, but only if you send me a KU news tip to divert my attention. Send 'em to merickson@ljworld.com.

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