Bringing Home The Bacon

Bringing Home The Bacon

The going rate for Grade-A education leaders, the latest controversial contract points and more

Even an inexperienced sleuth who happened upon the village of Dobbs Ferry, N.Y., could easily do it. The challenge: uncover the total compensation of the school district's leader.

"What you see is what I get," says man-in-charge Sidney A. Freund.

Several years ago, he and the board agreed "to avoid public confusion and suspicions by converting all benefits, exclusive of health insurance, to salary." Car expenses, life insurance premiums, annuity contributions and other benefits are now paid by the superintendent out of his base pay. "I believe that this approach has made my salary and benefits less of a public topic for debate," Freund says. Now complete, the conversion was accomplished slowly to avoid alarming jumps in salary.

This district's solution may be unique, but the reason for it is not. Administrator salary scrutiny is an ever-popular sport in a rocky economic climate. Budget slashes are synonymous with program cuts, requests for teacher concessions and job losses. "The recessionary economy has produced a tendency by some boards toward conservative [administrator] salaries, especially in districts where teachers and others have been laid off," says William L. Newman, executive director of the search firm Ray and Associates, which has worked with education clients since 1975.

When education leaders in troubled districts do receive increases, a media frenzy ensues. In one Chicago area district, for instance, a superintendent reportedly received a 20 percent raise last year despite a $5.6 million budget deficit and falling student test scores.

It's a pattern not unlike the salary of corporate leaders. An analysis of CEO compensation at 100 of the largest companies, published in the April issue of Fortune magazine, revealed that median compensation rose 14 percent in 2002. (To what? You don't want to know.) Yet, in that year, total return on the S&P 500 was down 22.1 percent.

Downward Pressure

For administrators, the situation is as political as it is economic, notes Paul Houston, executive director of the American Association of School Administrators. "There's real downward pressure on the salaries in districts," he says.

"If teachers aren't going to get a pay raise, one would hope that administrators would stay where they are, as well," says Lisa Graham Keegan, CEO of Education Leaders Council. "It's a good opportunity to reiterate the mission, a really good time to pull together [and say], 'Here's what we're going to do, here's what I'm personally going to do.'"

While she has noticed some superintendents forgoing increases, Keegan says, "The human reality is that the board has a personal relationship with the superintendent. They know the person is under increasing pressure. They see him or her every day, so that person is the likeliest to get increasing salary."

Pressure from another angle may make accepting an increase more difficult these days, with discussions about low teacher pay on the rise. Brian Crosby, Glendale (Calif.) Unified School District teacher, says that those in the trenches deserve increases the most. In The $100,000 Teacher: A Teacher's Solution to America's Declining Public School System (Capital Books, 2002), he argues, six-figure salaries should be attainable for "master" teachers, those with 15 years of experience and successful job performance.

How important is salary to those making the leap into administration? In a 2002 survey of Ohio superintendents conducted by the Ohio University Department of Education Studies, "improved salary" did rate as a high incentive. However, the "chance to have greater impact" and "making a difference" incentives were seen as more important.

Not surprisingly, "public pressure" was viewed as a low incentive. As Richard C. Lewis, deputy executive director of the Ohio School Boards Association, puts it, "Your life really becomes a fishbowl."

The Price of Leadership

Boards generally realize what good leadership is worth. Take, for example, Buffalo (N.Y.) Public Schools' Superintendent Marion Canedo, whose contract was renewed in June with a salary increase of approximately $10,000 annually.

Despite the district's fiscal challenges, which equate to extensive program cuts, the board praised Canedo for leading the district to improved academic performance, as well as for progress made on reform and in securing school construction funds. Besides, board members agreed, the alternative to securing Canedo would be far more costly to the district.

What keeps a superintendent on the job? According to recent studies, longevity is related to how much the board micro-manages, the amount of support given for needed construction, the district's poverty level and the level of the superintendent's educational background, says Helen C. Sobehart, an education consultant at DHR International, which has been conducting education searches since its inception in 1989. She believes the shortage of qualified superintendents, which many experts say has driven salaries up in the past few years, is a myth. While large urban and rural districts may be feeling a crunch, Sobehart says tenure is more likely to average six or seven years.

The 208 education and political leaders who signed a May 2003 manifesto, produced by the Thomas B. Fordham Institute and The Broad Foundation, do see a shortage of qualified leaders. And their area of concern is the traditional path to leadership in public schools.

The declaration, called Better Leaders for America's Schools, says the teacher to principal, to central office administrator, to superintendent career ladder (the last step accomplished "with a little luck, decent political skills and ample ambition") should be expanded.

Finding leaders from outside K-12 has certainly been tried in recent years, mainly in large urban districts with "many different moving parts," says Terry Ryan, program director at the Fordham Foundation. "Certainly [there] are good leaders from the traditional pipeline. But are there enough?"

Nine member districts in the Council of the Great City Schools currently have a non-traditional leader at the helm, and nine other cities in the 60-member group have hired non-traditional superintendents in the past, says Executive Director Michael Casserly. Average salaries for these leaders don't seem to be either higher or lower than averages of other big city superintendents. Casserly adds that most non-traditional leaders aren't taking a big pay cut to lead school districts, since they don't tend to hail from the top executive level of the private sector.

When they enter public education, non-traditional leaders are met with "a huge learning curve," says Rob Delane, director of school board development at OSBA. Ryan explains, "A view among many educators is that there's a culture of education that's critically important for any leader to understand and be a part of. ... They have to be appreciative of this culture. With that said, I don't think they necessarily have to have spent 20 years in that culture."

A few high-profile cases in the past year prove that non-traditional superintendent appointments haven't always been successful. Seattle's Joseph Olchefske, who has a finance background, has stepped down. Oklahoma voted earlier this year to restore a law requiring future principals or superintendents to have earned at least a master's degree in education. Reportedly, the resignation of Bill Weitzel, Oklahoma City's superintendent who hails from the university and business consulting worlds, had something to do with the legislators' decision.

A growing number of states are, however, beginning to offer alternative routes to administration. According to a recent National Center for Education Information survey, two states have stopped requiring certification of either principals or superintendents. Five states and the District of Columbia no longer issue superintendent certificates, leaving the leadership requirements to local districts. And 11 states have created explicit alternate routes to administration certification.

The manifesto endorsers, Ryan says, aren't saying that welcoming alternative leaders "is some sort of panacea to all the problems facing [schools]. We see it as one tool that should be in the toolbox for districts looking to improve themselves."

Search executives at DHR agree about the need to look outside the box. The firm has created a K-12 Practice Group through a partnership with Duquesne University's school of education to focus on "identifying, assessing and training leaders and CEOs for the 21st century educational environment," says David P. Smith, executive vice president of DHR. "Searching for CEOs of business and education should no longer be seen as separate practices and should be informed by concrete evidence from both fields," adds Sobehart.

So what can quality education leaders expect to earn in districts today? Here's a look at emerging and continuing trends in administrator compensation:

Rising Average Salaries

The National Center for Education Statistics reports a 22 percent increase in total school district employees between 1992-1993 and 2000-2001. Despite having more mouths to feed, average administrator salaries continue to rise. The average salary paid to superintendents is now at $126,268, a 3.7 percent increase over the past year, according to Educational Research Service's 30th annual school district salary survey. (See the charts throughout this story for more data from ERS's 2002-2003 study.)

Six-Figures, But Barely, For Women

AASA recently released the first national study of top women administrators in the U.S., with 1,350 respondents (surveys were sent to 5,500 women, nearly all females in the positions studied). Only about one-quarter of superintendent respondents earn $125,000 or more; over $100,000 is more typical, with more than half earning that much. The gender line is likely because women tend to serve in smaller districts, says co-researcher Margaret Grogan, who chairs the department of educational leadership and policy analysis at the University of Missouri-Columbia.

Among women central office administrator respondents (about 400 of the total sample), around half reported salaries of more than $100,000. Nearly 40 percent of these women aspire to the top spot in a district, but two factors may delay that: Women tend to wait until they've raised their own families, and going to a smaller district as a first-time superintendent (the most common scenario) often means a pay cut. "Because they're earning pretty well in the central office positions, it's really hard for them to move into the superintendency when they're going to get paid less," Grogan says. (See chart on page 34 for more on this study.)

TOP WOMEN'S WAGES INCOME INSIGHT: About half of women superintendents and central office administrators responding to an AASA survey currently earn more than $100,000 annually in base salary. Yet, among women administrators going for their first superintendency, it's not uncommon for them to have to take a salary cut. And barely one quarter of women superintendents earn more than $125,000 per year, which is close to the national average among all superintendents. A total of 1.2 percent of the superintendent respondents earn more than $200,000 a year; among women central office administrators responding, just 0.2 percent earn between $200,000 and $225,000 (none say they earn more than that). Of the nearly 5,500 surveys sent out to nearly all top female administrators in the U.S., a total of 1,301 completed surveys were received. Source: AASA National Study of Women Superintendents & Central Office Administrators: Early Findings, 2003, www.aasa.org

Little Wiggle Room for New Soups

For both men and women seeking a first top spot, candidates "usually do not quibble about the stated salary," Newman says. In addition, boards hesitate to offer incoming superintendents (even experienced ones) multi-year contracts, says Lewis, who also chairs the National Association of Superintendent Searchers, a group of state school board association staff that meets annually to compare notes on placement efforts. Yet, he adds, superintendents would typically like a three-year guarantee to relocate.

Total Compensation Packages

Boards are more inclined today to offer these packages, which set a total amount and then allow the final superintendent candidate flexibility in how he or she wants the earnings dispersed, says Thomas Jacobson of the search firm McPherson & Jacobson, which has contracted with more than 175 districts since 1991. "The bottom line is, the board knows the total dollar cost of the superintendent's contract, and there are no hidden benefits." Five or 10 years ago, these packages were less common.

Hidden Pay

On the other hand, with the perception that all administrators are overpaid, base salary is usually the toughest part of contract negotiations, says education consultant Billy Silky, of Castallo & Silky, which has conducted education searches for 19 years. This is when creativity comes into play. One Ohio example, from Lewis: For any new grants this superintendent could attain for the district, he received a bonus worth a percentage of the grants.

Performance Pay

Atlanta's superintendent, Beverly Hall, received a $30,195 bonus for the 2001-2002 school year. Of the 41 targets set forth in her contract (covering areas such as achievement in language arts and math, student attendance and student enrollment in higher-level courses), eight were immeasurable and she met or exceeded 45 percent of the remaining 33.

Hall's deal is one a growing number of leaders are inking. Smith and Sobehart say that tying pay to student performance is a more recent phenomenon. "Most of them tend to be test score bonuses," Houston says. "I've never been a big fan of those."

Thomas Glass, a professor in the department of leadership at the University of Memphis school of education, is also concerned. "Are test scores a legitimate way to reward a superintendent? What can a superintendent do in a year or two to affect test scores, outside of telling the guy running the computer program to reprogram the computer?"

The best criteria, Houston says, are goals that are "more closely tethered to what the superintendent does," such as changing a reading program or developing a long-range plan. Keegan says that "performance pay models are a little bit warped." She has a different idea for educators and non-superintendent administrators. "What should happen is that you do your job better, you get more responsibility and then more pay--not just [more] pay for [doing a] better job," she says.

Yet, performance pay is mandated for some. Since 1997, multiple-year contracts with Illinois administrators must be performance-based, linking to student achievement and academic improvement. Marcy Dutton, associate director for the Illinois Association of School Administrators, says that in the past few years, she has seen boards getting more actively involved in goal-setting, as well as a surge in goals related to district finances.

Growing Use of Search Firms

Silky has noticed more national firms getting involved in administrator searches, including more contracts with firms that don't just specialize in education. Private firm search fees, according to an informal District Administration poll, vary wildly, on factors such as the type of services required, the scope of the search and repeat relationships. Fees between $5,000 and $40,000 were reported. School board association searches, available in most states, tend to be less expensive. In Ohio, for instance, Delane says that 95 percent of searches end up costing about $7,900. Some districts use more than one firm.

Finance and Biz Help Wanted

Search firm executives report that they're getting contracts to fill more than just superintendent jobs. Assistant superintendent, treasurer, business manager and even principal searches are becoming more common. "There seems to be less final negotiations in filling these positions, when compared to superintendents," says Newman. These candidates "don't push as hard for life insurance and disability packages because they are a lot younger than superintendent candidates," adds Vincent J. Coppola, executive director of Western New York Educational Service Council, which has served approximately 400 districts since 1949.

More Loot to Buy a Leap

Eight or 10 years ago, Newman noticed most superintendents would consider a position elsewhere as long as the pay was better. Now, superintendents with good jobs are only "willing to move when the new salary exceeds their current salary by about $20,000," he says.

Happy Golden Years

Negotiating healthy retirement benefits is increasingly a concern today, says Houston, since superintendents often plan to retire late and not stay in a single district quite as long as in the past. Varying state retirement systems still make it difficult to cross borders and retain benefits, but he adds that each year he hears a little more talk about possibly changing the rules.

Meanwhile, some states' systems put money in the pockets of retiring superintendents. In Ohio, for instance, a superintendent can retire and be re-hired--all within the same board meeting, Lewis says. This way, the superintendent has entered the state retirement system but can still earn an annual salary, sometimes a lower one to help out the district's budget.

As with corporate CEO's, education leaders are interested in socking away part of their salary in tax-advantaged accounts. Tax-deferred annuities, insurance policies and Rabbi trusts (which are half-funded by a district and go toward future payment of benefits) are especially popular, Houston says. Asking for paid health insurance into retirement, Silky says, is also an important request today, as superintendents age and health insurance costs soar.

Money for "Nothing"

Several news stories from the past year detail what superintendents could get (or will get) for leaving their jobs. When one Minnesota leader was discovered to be on the market, the local newspaper revealed that he could get more than $350,000 at quittin' time--for 285 unused sick days, 100 unused vacation days and 6-months' severance. Carryover of a leader's sick days bank is one of the top three contract concerns Coppola has noticed when placing superintendents. (Starting salary and health and life insurance benefits are the other two.)

On the local level, when an education leader "leaves short of a contract and gets paid for it anyway, that creates firestorms," Keegan says. But, between including ever-commonly requested contract points like this and having to find a better candidate for the job, which storm is worse to weather? The question remains.

Methodology

Unless otherwise noted, data is taken from Salaries and Wages Paid Professional and Support Personnel in Public Schools, 2002-2003, published by Arlington, Va.-based Educational Research Service. ERS has been conducting surveys on salaries and wages in public schools annually since 1972. The 100-page report was based on surveys mailed to 1,940 of the approximately 11,206 public school systems in the U.S. that enroll 300 or more students, a universe that includes 62 percent of the total enrolled students in the U.S. Of those asked to participate, 620 school systems provided data for the survey.

The mission of ERS is to be the premier provider of timely, objective and reliable pre-K-12 research and information that education leaders need to make informed decisions (in both day-to-day operations and long-term planning) that improve student achievement and benefit all children. Online and print subscriptions to ERS research and information services, as well as customized analyses and comparative profiles, are available to all U.S. school districts.

800-791-9308, www.ers.org

Melissa Ezarik, mezarik@edmediagroup.com, is features editor.


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