Where the money goes at NYU

Dear Colleague:This week, the Faculty of Arts & Sciences is voting on Pres. Sexton’s leadership. (The electronic ballot ends on Friday, March 15.) In light of that referendum, and as other NYU faculties are considering votes of their own, we write to give our whole community some relevant —- and startling —- information.First, an update on the faculty campaign against the president’s expansion plan. (Those more interested in NYU’s disturbing finances may skip ahead.)



NYUFASP’s victory in court


Those critical of “NYU 2031” —- on the faculty, throughout the Village, and beyond —- have long held that the project has been thoroughly misrepresented by the President and his associates, and that the City is complicit, as its approval of the plan officially confirmed a false impression.

As the record indicates (and as we will show in a separate email), Pres. Sexton and his team have misreported nearly every aspect of the project, from its origins and purpose, educational utility and true financial cost to its social and environmental impact on the neighborhood, and likely toll on NYU itself.


In court last Tuesday, NYU’s faculty and neighbors —- represented by 11 groups joined as co-plaintiffs in the lawsuit filed by Gibson Dunn & Crutcher —- won the first round in their fight to set the record straight.


At issue is the status of the four parcels that the City would let NYU take over for the Sexton Plan: Mercer Playground, LaGuardia Corner Gardens, the Mercer-Houston Dog Run and LaGuardia Park. Among its other points, our lawsuit holds that those four “strips” are parks, and that the City always has regarded them as such.That fact alone could sink the plan, as, by law, alienation of parkland in New York requires approval by the state legislature, which NYU never sought.


In their filings with Judge Donna Mills, NYU and the City claimed that those parcels are not parks, and that the City never meant them to be parks.  As we reported last week, Henry Stern —- New York City’s longest-serving Parks Commissioner except for Robert Moses —- gave our lawyers a sworn affidavit charging that that claim is false, and that the City therefore broke the law when it approved the Sexton Plan. His point is reconfirmed in a sworn affidavit by Assembly Member Deborah Glick.


As NYU and the City gave Judge Mills false statements, our lawyers asked that she (1) allow them to file for expedited discovery, to see internal City correspondence on the status of the parcels, and (2) consider a hearing just on NYU’s illegal alienation of public parkland, to settle that matter in advance of the rest of the case.


To cut to the chase: We won. Judge Mills agreed to sign an order to show cause, meaning that NYU and the City must say why she should deny our motion. She ordered them to file their papers on March 12, and allowed our lawyers to reply on March 15. She will not hear oral arguments again, but will decide both issues on the basis of the papers filed, probably the week of March 18.


That day, NYU released a statement playing the moment down: Judge Mills’ decision “was merely a procedural move,” and the hearing nothing more than “an attempt to delay the scheduled judicial process, and it did not succeed.”


In fact, it was a major setback for NYU and the City, as both want nothing less than for those documents to see the light of day. It was therefore a bracing moment for the roughly 100 spectators in the courtroom, including faculty and other neighbors —- among them Matthew Broderick and playwright/filmmaker Kenneth Lonergan, who both spoke to reporters afterward. (Other noted Villagers expressing their support included Philip Seymour Hoffman, Susan Sarandon, Mark Ruffalo, Kathleen Chalfant and John Guare.)



Where the money goes at NYU 


$5 million for Jack Lew


This setback for NYU’s leadership is not the only one that’s in the news. As you may know, Pres. Obama’s nomination of Jack Lew as Treasury Secretary revived a scandal that got little press in 2007, soon after Lew left NYU for Citigroup: Citigroup’s role as a preferred lender for loans to NYU students at exorbitant rates —- a service for which Citigroup paid NYU kickbacks. (In a settlement with then-Attorney General Andrew Cuomo, NYU agreed to reimburse students $1.4 million.)

NYU chose Citigroup when Lew was here as an Executive Vice President, and so Senate Republicans looked into it, in preparation for the hearings on his nomination. As the  New York Post was first to report, Lew received a startlingly “fat compensation package” from NYU —- including a no-interest loan of over $1.3 million (which was partly forgiven), and a severance bonus of $685,000. The package overall “appears to have exceeded $5 million over four years.”


Usually you don’t get severance if you choose to leave, as Lew appeared to do, although NYU claims otherwise: “It is not uncommon for large organizations to make payments to senior officials on their departure, as happened in this instance,” NYU’s John Beckman told Danny Hakim at the New York Times. Others begged to differ: “It’s pretty unusual to get a severance payment upon a voluntary departure,” said Daniel Boyer, a senior consultant to universities. “Why are they doing that when he’s moving on to bigger and better things?” asked John J. McGowan Jr., an expert on employee benefits.”It’s the type of thing that might raise eyebrows.”


Ariel Kaminer of the Times then followed up on Lew’s peculiar severance, and found that such big parting gifts are, indeed, “not uncommon” —- at NYU. In “More Than One N.Y.U. Star Got Lavish Parting Gift,” she reports that, three years ago, Harold Koplewicz, a top administrator at Langone and founder of the Child Study Center there, got a bonus of $1,230,000 —- twice the size of Lew’s —- “around the time he left to found the Child Mind Institute, a competing organization.”


Like Lew, Koplewicz “left of his own accord,” Beckman told the Times —- and would say nothing more, nor would the doctor: “University officials said they would not discuss the payment further, and, reached through a spokeswoman, Dr. Koplewicz declined to comment.”


Such diffidence is understandable. Those payments may have been illegal, as there are strict rules governing such payouts by non-profits. But this is not the only cause for faculty concern.



Millions more for others at the top


What is most troubling about those two large gifts is not that they may be illegal, but that they are typical of the inflated compensation for NYU’s top administrative caste. That a few score upper bureaucrats make millions while most faculty and students struggle, academic programs face a thousand cuts and buildings fall apart is an inequity far more destructive to our university than two (or more) unlawful payouts.


Take Pres. Sexton, whose $1.5 million salary is only one piece of a dazzling compensation package. “When he leaves office, he will be paid $800,000 a year,” Kaminer reports —- but does not mention his $2.5 million “length of service” bonus, to be paid out in 2015, or his 100% healthcare coverage (a perk self-dealt to all NYU’s top administrators, as they do in Congress). Kaminer also reports that, after he retires, the President will get to stay in his apartment overlooking Washington Square.


And on top of that majestic deal (which includes a car and driver), in 2008 the President received a loan of $600,000, which he, or someone, has been paying off in ever smaller increments. (In 2010, the principal —- $545,175 —- inched down by $2,205.) This information comes from NYU’s 990 non-profit tax forms, which are publicly available online (and which also note that Pres. Sexton has an unspecified “business relationship” with NYU trustee Jay Furman).



Salaries at the top 


Those filings indicate that all NYU’s top administrators do extremely well, by academic standards, with none evidently making less than $330,000:


Data from IRS filing for tax year 2010-2011
Employee Compensation
John E. Sexton $1,476,625
Michael Alfano $   607,860
Robert Berne $   880,587
Bonnie Brier $   597,727
Martin Dorph $   506,870
David W. McLaughlin $   598,544
Jess Benhabib $   443,833
Andrew Brotman $1,106,788
Robert Grossman $3,488,960
Alison Leary $   338,807
Rosemarie Loffredo $   352,492
Tina Surh $   690,265
Debra LaMorte $   533,200
Marilyn McMillan $   330,516
Vivan S. Lee $1,165,751
Steven B. Abramson $   746.197
Dafna Bar-Sagi $   373.718
Vicki Match Suna $   680.054
 Michael T. Burke $   960.090
Linda Mills $   462,539
Annette Johnson $   589,573


In short, twenty-one managers were paid just under $17,000,000 —- three years ago. The total now would be considerably higher, as top administrative salaries, here as at schools nationwide, tend to rise more sharply than the national average. Between 2002 and 2010, Pres. Sexton’s salary rose an average of 11.37%, while that of Robert Berne, Executive Vice President for Health, rose an average 11.55%. At the School of Medicine, Dean Robert Grossman’s salary has jumped a whopping 23.57% per year.


Such raises are remarkable, especially for a period in which the national average pay raise was 2.67% —- and the average salary increase for NYU faculty was only 2.55%, a figure lower than the rate of inflation (2.77%). (Increases in tuition —- the primary source of all those six- and seven-figure salaries —- have averaged 5.24% throughout those years.)


In any case, this managerial elite costs NYU far more than $17,000,000, as there are many others whose salaries are not listed in the 990s. They include Deputy President Diane Yu; John Beckman, Vice President for Public Affairs; Alicia Hurley, Vice President of Government Affairs and Community Engagement (in charge of marketing “NYU 2031”); and Joe Juliano, Vice Provost and Associate Vice Chancellor for Strategic Planning (responsible for managing the Global Network University). The total sum absorbed by all such powers, in salaries and benefits, must be considerable, especially in light of what a university is meant to do.


Many of those managers are not professors, and have no known academic interests, although some are put in charge of academic programs: Diane Yu —- Executive Director of both the NYU Abu Dhabi Summer Academy and the Sheikh Mohamed bin Zayed Scholars Program —- was an attorney at Monsanto before moving here; and Vice Provost Juliano —- who lately served as Acting Chair of the Graduate Film Department at Tisch Asia —- holds a B.S. in accounting. (“I remember being told by him that I was ‘only an academic,'” recalls Prof. David-Hillel Ruben, who ran NYU’s London program under Juliano, until the stress forced him to quit.) As their world-view is corporate rather than scholastic, it is appropriate, if fiscally precarious, that they make salaries more suitable to Wall Street than “a private university in the public interest.”



What they pay the faculty


Meanwhile, the faculty at NYU —- those who really serve the students —- are paid the least, in line with this administration’s low regard for those who are “only academics.”  To be sure, some of our more eminent colleagues are paid grandly —- and, in their case, deservedly —- for the luster of their names; but their particular rewards do not begin to match the general overpayment at the top, or mitigate the underpayment of the professoriate at large.


Even those who are best off —- the tenured faculty —- earn much less than the administrators at the top. With the higher salaries for marquee names included (most of them in the professional schools, with some in the hard sciences and economics), the average salary for a full professor here is $182,400; for an associate professor, $106,100; and for an assistant professor, $99,700 , according to the Chronicle of Higher Education. (At every level, women still make several thousand dollars less than men.) As noted earlier, that relatively privileged group has seen its compensation rise even more slowly than the national average, creeping up by 2.55% a year —- and, some years, not at all, as their salaries have been frozen twice since 2002, while Pres. Sexton and his team kept making more and more.


Of course, the gap is even larger for non-tenured faculty, whose numbers have exploded under Pres. Sexton, growing from one third of NYU’s full-time professoriate to slightly more than half. In 2002/03, NYU had 648 non-tenured full-time faculty, and 1,295 with tenure. By 2011, that number had shot up 216%, to 2,049, so that less costly teachers now outnumbered tenured faculty (by 44). In 2010 (the last time figures were available), the full-time non-tenure faculty made from 26% to 40% less than their counterparts with tenure: $114,890 for clinical full professors; $83,388 for clinical associate professors, and $67,123 for clinical assistant professors. The inequity is all the starker for the fact that contract faculty must do more teaching and administrative labor than their tenured peers.


And yet those faculty are flourishing by contrast with the several thousand adjunct faculty who do the lion’s share of teaching here at NYU. (At the School of Continuing and Professional Studies —- an “adult education” center yielding tens of millions yearly in tuition revenue —- there are 20 non-tenured full-time faculty, and over 90 adjuncts.) These essential teachers, many of them working far and wide to earn a living, can make as little as $2,500 per course at NYU, while those who teach enough courses to join the adjuncts’ union (as over 2,500 have) can make a little less than $5,000 per course, or $117.25 per hour. Although they no longer have a union, NYU’s roughly 1,000 graduate instructors make the same amount.


It is instructive to compare such classroom service with our President’s, for he too is a dedicated teacher: “I’ll be a bit immodest here,” he told the City Council last June. “I think I’m the only university president in the world that teaches a full faculty schedule. I teach four courses every academic year; I teach undergraduates.”


This year, it would appear that Pres. Sexton did not teach four full-time undergraduate courses, but only one or two. In any case, if he did carry the usual full load —- two courses per semester at 4 credit hours per course —- it would cost immensely more than anybody else’s at this university (or any other). With his salary of $1.5 million, the world’s only university President/professor would make $375,000 per course, which works out to a little over $8,900 an hour (as per the adjunct schedule).



Their benefits, and ours

That salary aside, NYU’s faculty is quite a bargain, whatever our top colleagues may be paid; for it is this cheap pool of academic labor that services the 50,000 students —- some high administrators call them “clients” —- in New York (while an even cheaper pool supports the ever-spreading Global Network University).

Thus the President et al. make millions from tuition revenue at little relative cost in professorial salaries —- and ever less in benefits. While the top administrators receive full healthcare coverage (as in Congress), those faculty with health insurance have seen their coverage shrink and co-pays rise these last ten years. While those on high continue to get full tuition remission for their families (with some reportedly receiving it for children going to other schools), for faculty that benefit has been restricted and reduced. And while the President and his associates (and friends) are grandly housed at university expense (about which more later), and often get to stay there post-retirement, those faculty who live in NYU-owned properties have seen their rents raised by 16-18%,  and must move out when they retire, although dozens of apartments have, for years, been standing empty.


The road ahead


Here we have just begun to sketch the huge inequity between NYU’s high administration and the faculty. (We will shortly send a similar analysis of NYU’s peculiar finances —-especially the loans to favored peers —- in light of the inordinate debt burden on our students.)  This overview conveys not only some particulars concerning who gets paid and who does not, but —- even more important —- the breakneck growth-for-growth’s-sake strategy behind them, and its ultimately devastating impact on all faculty, and, therefore, on NYU itself.

Pres. Sexton has said, and apparently believes, that “universities need to grow to maintain excellence.” That logic has now stretched this professoriate —- and NYU’s students —- to the breaking-point, as all of us work ever harder, making ever less, to keep NYU going, not as a place of education and research, but as an empty, bright world brand that profits no one but its managers.


If this were the community of learning that it ought to be, all of us —- both faculty and students —- would be properly supported and respected: equal in potential, worth and dignity, if not in knowledge or in rank. Pres. Sexton has been moving NYU as far from that ideal as any school can go, to the clear detriment of those who ought to matter most. At the top, our students are not valued for their minds and talents, but only for their numbers: “How many can we get? How much can they pay?” Thus the goal is not to educate them but exploit them; and the consequence, for thousands of them, is four years of bone-tiredness and anxiety, then (if they can afford to graduate) unending debt.


And for the faculty, this president’s regime has been one long top-down push toward the lowest of equality for all, so as to have a mass of teachers big and cheap enough to service the ever-growing mass of student “clients.” Since he was appointed, we have seen a steady increase in the numbers of contingent faculty —- clinical professors, adjuncts, graduate instructors —- and, at the same time, a subtle drive to undercut, and break, the troublesome minority that is the tenured faculty. This drive has been apparent in the President’s long refusal of shared governance (while claiming to support it), and his efforts to derail, and then discredit, this week’s vote —- to name but two examples out of many.


It is that ruthless and unthinking push to grow this university, whatever it may cost financially or academically, that has us pushing back this week —- to save NYU’s neighborhood, the city, and the university itself, from “2031”; to bring NYU’s rampant global enterprise under rational control; and, at long last, to share the governance of this great university, so that our students are not just counted, but count most, and all faculty are duly honored and rewarded for it.


Thank you for your time and attention.




Further reading:

One reply on “Where the money goes at NYU”

Peter, my apologies for not riedonpsng to your 14 March post until now! I had expected to receive the SC application decision several weeks ago .and I was just accepted yesterday! If you’re still up to it, can we chat about the program? I’ve been accepted elsewhere and need to make a decision fairly soon. I’m not yet dialed into twitter or Linkin, but I registered here can you pull my email address or should I go ahead and post it publically? Thanks!!

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