The University of California Board of Regents has approved a raise and $20,000 annual bonus plan that will lift the pay of Senior Vice President Joseph Mullinix from $291,900 to $370,000 -- above even the current UC president's salary of $361,400.
It comes at a time when UC officials say they are in a desperate budget situation that has forced them to raise student fees by 25 percent -- with more to come if the state Legislature chops additional funds from the budget. UC is also cutting student programs and services and even considering layoffs.
UC President Richard Atkinson said in a December 2002 letter that systemwide increases for senior administrators would not be appropriate because of the budget problems, but he added that some might have to be considered for those who got firm job offers. Otherwise, UC could lose a talented staff member and face the costs of a search and possibly paying a replacement a higher salary.
Mullinix, the senior vice president for business and finance, received the increase -- which totals 27 percent -- on May 1, after he got a competing offer from the University of Michigan.
"We've lost some top people in the last few years due to inadequate salaries. . . . These losses are especially disadvantageous to UC given the management challenges confronting UC due to the state's budget difficulties," said UC spokesman Paul Schwartz.
But Claudia Horning, statewide president of UC's clerical union, said that Mullinix's raise "shows that the University of California is not fiscally bankrupt, but it is morally bankrupt."
"It is a crime against the taxpayers of the state," Horning said. "It is an insult to the students and to everybody who works for the university. They are managing it as though it is like Enron."
Schwartz said the salaries of UC's senior administrators, including top administrators, chancellors and the president, significantly lagged behind those of UC's comparison institutions.
Mullinix oversees a vast range of administrative functions, from UC investments to labor relations and technology transfer, and is uniquely qualified for the job, Schwartz said. And Mullinix's raise did not match the package offered by the competing university, he said.
In comparison, the state's director of finance, Steve Peace, makes $131,412 -- minus a 5 percent reduction in salary he voluntarily took this year along with the governor's other appointees to help out with the budget shortfall.
Regent Ward Connerly said Mullinix, who has worked at Yale and Columbia universities, the Goldman Sachs investment bank and as deputy associate director at the U.S. Office of Management and Budget, had been "rather outstanding" but that he opposed
"offer shopping" on principle.
Giving raises to match outside offers creates a ladder effect, he said.
It turns into, "You get a raise, and I get a raise," Connerly said.
UC sets its executive salaries based on an annual study of the market at comparable universities and on the relation of internal positions to each other. Mullinix's raise is likely to force UC to boost the salary of other executives.
"You can't have people making so much more than others," Connerly said. "Once you take these positions one at a time like this, you do skew the relationship between the different positions. It has always been something I thought was out of line, and it has created a certain bloatedness."
Last week, UC hired a new president to replace the retiring Atkinson. Robert Dynes, currently chancellor of UC San Diego, will make $395,000. Although the regents offered him more money because the market demands it, critics said it had to be done anyway because a vice president cannot be making more than the president.