Compensation Letter (December 2013)
Based on feedback and questions we have received through the town hall meetings and e-mail, there has been a request to post a copy of the e-mail sent to Chatham University alumni in December of 2013 concerning the background on Dr. Barazzone’s reported compensation in the most recent 990 form for the year of 2011.
The following is a copy of the e-mail:
December 13, 2013
Dear Chatham Alumni Community:
Around this time each year, The Chronicle of Higher Education reports the compensation of university presidents based on data reported in their institutions 990 Form (the annual IRS report that all higher education institutions are required to file). Due to IRS reporting requirements, as well as the vesting of President Esther Barazzone’s retirement funding, I write to put the figure that will be reported in the Chronicle (and almost surely picked up by other media outlets) in greater context.
In 2006, Chatham University’s Board of Trustees approved the awarding of a deferred compensation retirement package to Dr. Barazzone to rectify previous inadequacies in retirement funding over the first 14 years of her service and to incentivize her to stay at Chatham to continue the progress and successes that have marked her presidency. After consultation with a national compensation authority, the Board designed a retirement package that was funded each year beginning in 2006, and that Dr. Barazzone would have forfeited if she left Chatham before her contract terms.
What you should understand when reading the figure that will be reported in the Chronicle is that the vast majority of Dr. Barazzone’s compensation in 2011 is made up of retirement contributions that were previously reported in her compensation each year since 2006. This “double-counting” of previously reported retirement contributions is the reason for the significant jump in Dr. Barazzone’s total compensation and ranking for the year of 2011. Since the funds would have been forfeited if Dr. Barazzone left Chatham, the IRS requires this type of additional reporting upon the fulfillment of her retirement package per the contract terms. If these previously reported retirement funds are not included, Dr. Barazzone’s actual compensation, including her base pay (which has remained relatively the same since 2006), would be at the same levels as previous years and no means warrant her inclusion in this list for the year of 2011.
For the past twenty years, Chatham is proud that we have been able to retain one of the longest serving and most productive presidents in the nation. Dr. Barazzone has continually demonstrated her leadership and commitment to the institution while guiding Chatham through a particularly transformative period of growth and success. For that the Board is extremely thankful, delighted that our retirement funding package had the desired effect, and pleased that Dr. Barazzone will remain at Chatham for some time to come.
S. Murray Rust
Chair, Chatham University Board of Trustees