UPDATED: This post was updated on July 15, 2013 at 2:57 p.m.
If you’ve been following the story over New York University’s executive and faculty compensation controversy, you may have seen this story in today’s New York Times, headlined [smcaps]“N.Y.U. Impeding Compensation Inquiry, Senator Says.”[/smcaps]
The “Senator” is Sen. Charles Grassley (R-Iowa), who in March, asked the university to provide information regarding its compensation schedule. Grassley’s curiosity had been piqued during U.S. Treasury Secretary Jack Lew’s confirmation hearings in February, when it came out that the one-time N.Y.U. and Citigroup executive had received subsidized mortgages and a $685,000 golden parachute from the university.
On March 15, Grassley “ratcheted up his questioning of the university, saying he was doing so because of its nonprofit status, which affords it considerable income and property tax exemptions,” The New York Times said.
As a business writer who covers the Treasury Department and an N.Y.U. alum, this story has been particularly interesting for me, so I’ve been keeping an eye on it for a while. I’d already known some of the details described in the Times story, including the restrictions N.Y.U.’s lawyers have placed on Grassley’s staff. For example, only permitting in camera review of certain documents and allowing the senator’s staff members to take notes, but forbidding them from making or keeping copies.
Back in March, after the New York Post broke the story about Sen. Grassley’s inquiry, I posted the first copy of his letter to N.Y.U.:
— Sergio Hernandez (@cerealcommas) March 18, 2013
Today’s Times story refers to certain subsequent correspondence between N.Y.U. and the senator’s office (responses dated March 29 and April 19), but didn’t publish copies of those letters, either.
I’ve uploaded them here in case you’re curious:
UPDATE: Some additional correspondence between N.Y.U. and the senator’s office came my way this morning, which includes some aggregate data on NYU’s faculty loans, signing bonuses, and severance payments.
Some highlights about the faculty loans:
Between January 1, 2000 and January 11, 2013, NYU provided 281 loans totaling $89.83 million.
- 214 (76 percent) of the loans, totaling $68.77 million, were provided through NYU loan programs designed to help employees buy a primary residence.
- 67 loans, totaling $15 million, were forgivable loans (forgivable as to principal; loans forgivable as to interest but not principle are listed as zero interest loans).
Of the 281 loans:
- 129 loans ($24.60 million) were zero-interest loans. 20 loans totaling $3.64 million would bear interest of 0.5 percent upon borrower’s retirement.
- 82 loans ($35.97) million were interest bearing loans.
- 70 loans ($29.27 million) had shared appreciation feature. Of these loans, 42 (totaling $12.93 million) charged interest on current basis; 22 loans (totaling $12.98 million) charged no interest; and 6 loans (totaling $3.36 million) accrued interest on a current basis.
The submissions also include some details on employee compensation.
From January 1, 2000 through January 1, 2013, NYU paid out three signing bonuses of $100,000 or more. The first was the $100,000 signing bonus paid to Jack Lew in 2001.
The university also paid $125,000 to “a physician-scientist (MD/PhD) faculty member in the School of Medicine” in 2002.
And in 2009, the university paid a $200,000 signing bonus “to a physician (MD) faculty member in the School of Medicine,” contingent on him staying on as chair of a department for three years. The list of suspects for this one is fairly short: a search of the NYU School of Medicine’s press releases shows the appointment of four male MDs to chair departments in 2009: Charles Marmar,
J. Thomas Roland, Jr., David L. Keefe, and John G. Golfinos.*
In the same time period, NYU paid out 102 severance payments of $100,000 more—all to School of Medicine employees. The average severance payment was $339,217.
There were 56 other severance payments of $100,000 or more, paid to employees outside the School of Medicine. The average payment was $216,082.
Grassley also issued a statement:
The Lew nomination brought to light several perks Secretary Lew received from New York University. Those perks raised the question of how many other university employees receive them. Transparency regarding the level of housing loans, signing bonuses and severance payments that a tax-exempt organization offers to staff is in the public’s interest. Students and families struggling with college affordability have a legitimate right to know how their colleges spend money. The tax exemptions given to colleges to fulfill their charitable mission are significant, and subsidies through federal student aid allow such universities to charge much more for tuition than they otherwise could. In exchange for those benefits, colleges should expect some scrutiny and be transparent, now maybe more than ever before with the challenges of paying for higher education. New York University pledged full cooperation with my inquiry months ago. NYU has submitted some information that I requested about loans and other staff benefits. I don’t consider the submission complete. An informed judgment requires details of individual loans, such as the dollar amounts and terms, and some level of detail about the staff position. I’m not interested in Social Security numbers or disclosing individual identifying information. I’m looking for a more complete understanding of how NYU uses these loans. For example, NYU Executive Vice President Dorph told students and faculty that the loans ‘generate funding for … the University.’ It’s now clear that 46 percent of the loans generated zero interest for NYU. Without seeing the details of the loans, there’s no way to evaluate this and other assertions.”
Read the documents here:
* Dr. Roland says he did not receive a signing bonus. And then there were three…