MnSCU Doles Out Exec Bonuses to Union Opposition

The education system said that the one-time "performance payments" recognize progress made toward its goals, but a local union representing some of its employees said that the system's trustees are "ignoring the system's budget crunch."

Despite strong union opposition, trustees of the Minnesota State Colleges and Universities (MnSCU) system on Friday announced plans to distribute $415,875 in what it calls “performance pay” to 33 top administrators.

In a Friday news release posted to its Web site, the American Federation of State, County, and Municipal Employees' Council 5 (AFSCME)-said that the trustees who made the decision are “ignoring the system's budget crunch.” AFSCME Council 5 is a union of 43,000 public and non-profit workers in Minnesota, including 3,500 of MnSCU's 10,000 employees.

MnSCU said in its own Friday news release that it “made significant progress last year toward achieving system goals” and that system leaders received one-time performance payments in recognition of that progress. Under the terms of their contracts, MnSCU presidents and vice chancellors are eligible to receive performance pay of up to $15,000 each if they meet specific goals. Their base salaries, however, have been frozen for the past two years.

“We are proud of what the presidents have accomplished under especially difficult economic conditions,” Scott Thiss, MnSCU's board chair, said in a statement. “Meeting these goals is critical to ensuring that Minnesota continues to have a world-class workforce as baby boomers retire and a younger, more diverse population moves up.”

But AFSCME had a much different take on the recent distribution of what it calls “bonuses.”

The union accuses MnSCU of ignoring Governor Tim Pawlenty, whose spokesman said in July-after MnSCU Chancellor James McCormick got a $40,000 bonus-that “a bonus during these economic times is unwise and out of sync.” AFSCME also accuses MnSCU of ignoring Pawlenty's announcement from his 2009 State of the State address: “I'm proposing we freeze all state government wages for the next two years.”

AFSCME said that state employees accepted a wage freeze in exchange for fewer layoffs. But instead, it said that MnSCU is giving bonuses to top executives and eliminating 41 positions from the chancellor's office, including nine union members who are expected to receive layoff notices Tuesday. AFSCME said it anticipates that MnSCU may eliminate 500 or more additional positions later this year.

“Trustees are passing out bonuses with one hand, pink slips and tuition hikes with the other hand,” Karen Foreman, an AFSCME member who works at Minnesota State University, Mankato, said in an AFSCME news release. “We need to put a stop to that.”

According to MnSCU, McCormick conducted performance evaluations for the presidents and vice chancellors, who together helped the system achieve specific goals this year, including:

  • Achieving 76 percent of the increase needed to meet its 2014 goal to retain students from traditionally underrepresented groups-including students of color, first-generation college students, and low-income students
  • Enrolling an additional 13,000 students in science, technology, engineering, and math courses-representing a 12 percent increase since 2008
  • Increasing the number of students enrolled in science, technology, engineering, and math courses to 128,000-surpassing a goal to have 114,477 students enrolled by June 30, 2011
  • Increasing enrollment in online courses by 61 percent since fiscal-year 2008-and staying on track to reach a 2015 goal of having 25 percent of the system's full-year-equivalent enrollment in online courses.

“The board of trustees . . . remains committed to performance incentives because they provide greater accountability by the system's top leaders, and they support the board's general philosophy of basing compensation on achievements,” Thiss said in a statement. “This approach helps ensure taxpayers receive a good return on their investment.”

The MnSCU system comprises 32 state universities and community and technical colleges in Minnesota. It serves about 260,000 students each year in credit-based courses and another 164,000 in non-credit courses.