The superintendent's contract extension: Another misstep for the SRC

by Helen Gym on Mar 01 2011 Posted in Commentary

The announcement by the School Reform Commission that it will extend Superintendent Arlene Ackerman’s contract through June 2014 sends a terrible message about the SRC’s approach to the most serious financial disaster the District has seen in recent memory.

The move effectively preserves one of the most lucrative pay packages for a public employee in the state, flying in the face of a national bipartisan trend toward curbing exorbitant compensation for school chiefs.

The contract provides the superintendent with a current salary of $348,140, more than the mayor ($167K with a voluntary 10% paycut) and governor ($175K) combined. According to a 2009-2010 study by the Council of Great City Schools, $275,000 was the average salary of heads of districts with 100,000-200,000 students.

The contract becomes even more problematic when bonuses are factored in. An annual performance bonus worth up to 20 percent of the superintendent’s salary amounted to $65,000 last year. It also entitles the superintendent to a $100,000 retention bonus this year that may be renewed at the discretion of the SRC. In response to inquiries, Ackerman agreed to defer the bonus until the District is on firmer financial footing.

The bonuses are in addition to annual raises, her health plan, and a $65,000-a-year contribution to an annuity. Add to that  34 vacation days, 30 days of paid consulting time (which come out of her vacation or personal days), and perks like a car and premiums toward a $1 million life insurance policy.

I contacted the New York City school district, where recently hired Chancellor Cathleen Black earns $250,000, not a single dollar increase over her predecessor and a salary that hasn’t changed since 2002. There are no retention or performance bonuses for Black, who runs a district eight times larger than Philadelphia’s.

The District's communications office has pointed out that Black has some lucrative side deals with corporate boards that dramatically boost her pay. I'm curious to get the same information on our superintendent. She too has a contract that leaves plenty of room to earn money on the side.

To be fair to Superintendent Ackerman, the high-rolling salaries in Philadelphia began when the SRC was first formed, headed by James Nevels, an investment executive. Nevels often said private industry would solve the problems of public education, and Nevels, who dined regularly at the Four Seasons on the District's dime, had the District paying salaries to match. Ex-superintendent Paul Vallas was the first to negotiate previously unheard-of retention and performance bonuses.

But should such excessive compensation continue?

All across the country, there is distaste for pricey superintendents whose short tenure and high salaries more resemble a sports free agent than a public employee. New Jersey captured national headlines with its superintendent salary cap. Recently, New York Gov. Andrew Cuomo announced a similar intent to cap superintendent salaries. Philadelphia state Rep. Michael McGeehan has said he’ll introduce legislation that would cap superintendent salaries at an amount no greater than the governor’s and restrict bonuses and severance packages.

In response to the fiscal crisis, Ackerman has offered to take 20 furlough days, which amounts to roughly seven percent of her base salary. It’s a short-term gesture with no impact beyond this year, especially since she already received a 3 percent raise in the fall and has a hefty retention bonus in the wings.

The District's communications department contacted the Notebook on this topic and emphasized that the superintendent is not the highest paid superintendent in the country, pointing to expensive superintendents in Long Island, N.Y. and elsewhere. They also highlighted that Ackerman works round the clock for schools. I don't doubt the superintendent's work ethic but at some point - and I believe we crossed that line tens of thousands of dollars ago - the issue of the salary of a public employee in a time of dramatic fiscal crisis has to be set aside from who they are, the amount of hours they put in, and even their performance. This isn't the private sector where lawyers bill for hours, and corporate execs watch Wall Street tickers for their bonuses.

The SRC’s decision to extend this contract once again underscores their failure to recognize their oversight of one of the greatest financial meltdowns in district history:

• A deficit that approaches half a billion dollars.
• Where solutions like increased class size and school closings are casually dropped to shocked parents and school communities.
• Where central office staff could be slashed by a third and teachers are told to expect layoffs.

It’s a district where, despite a $3.2 billion budget, a school nurse in elementary school is considered a perk, and art and music classes are luxuries.

Meanwhile, the SRC chose to pass a budget that not only spent down its entire reserve fund but also started new programs and hired high-priced executives and consultants through the fall. Now they’ve renewed a contract for a superintendent that is far out of line with public sensibility.

It’s hard to imagine how the SRC can send a message of fiscal responsibility to Harrisburg or communicate a “share the pain” directive with parents and school communities who fear they’ll have to bear the brunt of the SRC's apparent indifference or incompetence about its financial missteps.

A version of this piece also appeared in the Daily News.