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Posted on Sun, May 12, 2013 : 6 p.m.

University of Michigan leader Mary Sue Coleman 6th-highest-paid public university president in U.S.

By Kellie Woodhouse

050413_UM_Commencement_CS-1.JPG

University of Michigan President Mary Sue Coleman addresses graduates in Michigan Stadium at commencement ceremonies May 4.

Courtney Sacco | AnnArbor.com

University of Michigan President Mary Sue Coleman earns a total compensation of $918,783 a year, the sixth-highest pay of a public university leader in the U.S.

The Chronicle of Higher Education reported Coleman's compensation as part of an examination of presidential pay at public universities in fiscal 2011-12.

Coleman is the highest paid university president in Michigan.

She received base pay of $586,000, deferred compensation of $175,000, retirement benefits of $58,000 and a $100,000 bonus. She also receives the free use of a house and car.

In September 2012, Coleman received a 3 percent raise, bringing her base salary to $603,400. She donated her initial raise of $17,600 to scholarships, but will receive the base increase next year. Coleman is set to retire in July 2014.

When offering Coleman a raise in September, former Regent S. Martin Taylor, speaking on behalf of U-M's governing board, defended Coleman's salary.

"We’ve looked at all the publications, the benchmarking, what's being done, best practices et cetera. ... The base salary of the president is certainly not out of line in terms of being too high," he said. "If anything it is too low."

AnnArbor.com obtained Coleman's compensation and benefits package in 2011 through a Freedom of Information Act Request and found that she earned $933,000. Coleman's full compensation package is paid out of U-M's general fund, which is comprised mainly from tuition dollars and state funding.

The highest paid public university president in fiscal 2012 was Graham B. Spanier, the former leader of Penn State University. Spainer earned base pay of $351,000 that year, but received $1.25 million in deferred compensation after he was forced out of his position due to the Jerry Sandusky sex abuse scandal that roiled Pennsylvania's flagship public university that year, according to the Chronicle.

Michigan State University President Lou Anna K. Simon earned $672,000 in fiscal 2012, and Wayne State University President Allan Gilmour earned $506,000, according to the Chronicle.

The Chronicle analyzed the salaries of six college leaders in Michigan, including the leaders of MSU, WSU, Central Michigan University ($431,000), Oakland University ($437,500) and Western Michigan University ($471,400).

"I look at their compensation and what they do, and then I look at a CEO of a Fortune 500 company, and I go 'wow, they're doing it at that price?'" said Michael Boulus, executive director of the President's Council for State Universities of Michigan. "They deserve every penny they get, given the fact that what they do most is not only lead the university, but raise money for the university."

Coleman, for example, is credited with being one of the best fundraisers in higher education. She recently secured a $110 million gift, the largest in school history, from a California billionaire that will be used to help build a dormitory for graduate students.

The median total compensation for the 212 presidents at 191 public research colleges surveyed by the Chronicle was $441,392. That figure represents a 4.7-percent increase over 2010-11.

The Chronicle did not report on Eastern Michigan University President Susan Martin's pay. On Friday, Martin was granted a contract extension that raises her base pay to $300,000 a year. Martin collected $295,000 in 2011.

E. Gordon Gee, president of Ohio State University, earns $1.9 million a year and received the third-highest pay among public university presidents in fiscal 2012, according to the Chronicle report.

University of Maryland President Wallace Loh, who earned his Ph.D. at U-M, made $483,000; University of Virginia President Teresa Sullivan, who used to be provost at U-M, earned $731,500; and University of Florida President Bernard Machen, who also used to be provost of U-M, earned $834,562.

Coleman also serves on the executive boards of Johnson & Johnson and Meredith Corp. She took home $425,400 in 2011 for her service on those two boards, according to a Chronicle database derived from U.S. Exchange Commission filings.

Coleman was ranked as the fifth-highest paid public university leader in fiscal 2011, according to a Chronicle database from that year.

    Top 10 highest-paid public university presidents in fiscal 2012:

  • 1. Graham B. Spanier*, Pennsylvania State University, $2,906,271
  • 2. Jay Gogue, Auburn University, $2,542,865
  • 3. E. Gordon Gee, Ohio State University, $1,899,420
  • 4. Alan G. Merten*, George Mason University, $1,869,369
  • 5. Jo Ann M. Gora, Ball State University, $984,647
  • 6. Mary Sue Coleman, University of Michigan, $918,783
  • 7. Charles W. Steger, Virginia Tech, $857,749
  • 8. Mark G. Yudof, University of California, $847,149
  • 9. Bernard J. Machen, University of Florida, $834,562
  • 10. Francisco G. Cigarroa, University of Texas, $815,833

Kellie Woodhouse covers higher education for AnnArbor.com. Reach her at kelliewoodhouse@annarbor.com or 734-623-4602 and follow her on twitter.

Comments

BhavanaJagat

Tue, May 14, 2013 : 4:57 p.m.

Whole Dude - Whole Declaration: At the University of Michigan they could be teaching students about a historical document called 'The Declaration of Independence'. I would like to know as to what these students think about concentration of wealth in the hands of few people. Is it consistent with the intent of seeking 'Independence'? I have to specifically know as to how the educators at the University of Michigan address the problem of growing disparities in personal income. We have rich people in this country and in the rest of the world while a vast majority of people live from paycheck to paycheck. In India, I grew up in a tradition that constantly alerts me about the corrupting influence of wealth. As far as I am concerned, I have to find satisfaction in Life by receiving Divine Providence to which all living creatures find an equal share as their entitlement. If this educator is making all this money, I do hope that she has some free time to enjoy the experience of her living condition and relax for a few minutes to read the local newspaper and know the community and its environment.

Dena

Mon, May 13, 2013 : 9:19 p.m.

Criminal at the amount of money and benefits she makes. Oh, I forgot, the liberal elite are allowed to live above the rest of us peasants who have to scrape to pay for living and education.

mary

Mon, May 13, 2013 : 8:51 p.m.

Completely ridiculous!!!!!!!!!!!!What do they do to make this money? They are not saving lives, changing the world in a positive way...nothing. No wonder it costs so much to go to college/university! This is a stupid as paying athletes, movie stars, musicians tons of money. What is wrong with our thinking!

sheri barron RN,BSN

Mon, May 13, 2013 : 6:07 p.m.

I am very surprised the last posting has lasted as long as it has- almost an hour. I am very concerned about people not being able to use the justice system to solve their disputes. It would also be nice if the University would set up their own investigations to nip situations in the bud. I think this would be the greatest gift Dr. Coleman could give the University during her last year there. I read a posting where the U spends 4x more preventing someone from getting a trial than they do trying to prevent a situation from happening. It was in the annarbor.com under one of the child porn articles. I hope the statistics change in the next year. Thank you Dr. Coleman in advance for your efforts in making the University a safer place for patients and employees.

sheri barron RN,BSN

Mon, May 13, 2013 : 5:41 p.m.

Please see UMICH lawsuits on vimeo. It is such a large organization. Does anyone else wonder why there are not more lawsuits? After all everyone makes mistakes. I hope Dr. Coleman can clean things up before she leaves. I do not know much about politics so I can't judge her or anyone else. I am only going by the facts I know. I have only tried to help people/patients/families for over 30 years. This is what I am trying to do now. It has never been about me. I almost died and I do not want that to happen to anyone else. If anyone has any suggestions about what can be done to prevent this from happening to anyone else please contact me. thank you

BhavanaJagat

Mon, May 13, 2013 : 5:20 p.m.

Whole Dude - Whole Equal: Something had inspired the fathers of this nation to prepare a written Constitution which has become the supreme law of this Land. There is a concern about man being born equal and yet there is inequality among men. If the University of Michigan is a place of higher education, it must take this challenge and find the reasons for this inequality and offer solutions to remedy this problem of inequality. I am least impressed by the money earned by Ms. Mary Sue Coleman. Does she have the intellect or the intellectual potential to describe her understanding of man's equality? Does she have the courage and integrity to speak on this issue in a public forum where I can present my understanding on an 'equal' footing? Is she prepared to face me as an equal? I assure all of the readers that the salary she takes home will not come to her rescue if she opens her mouth and speaks the truth about humans being born equal but in reality cope with unjust inequalities.

cibachrome

Mon, May 13, 2013 : 2:52 p.m.

I had hoped that this position at such a prestigious University would be voluntary. Maybe someone should tell her that there are no trailer hitches on caskets. Would she dare refuse the money and donate it to affordable housing, artwork, homelessness, cancer research, or other Michichigan public benefits? Anyways, I just read that UofM did NOT make the list of the 10 best universities to get a worthwhile college education.

blue85

Wed, May 15, 2013 : 1:58 a.m.

I guess you don't follow the 3 significant global rankings which ALL rank Michigan in the top 10 globally. You must also not follow the same rankings which indicate that the University is considered number six for undergraduate education. Rankings which place the university in the high twenties are almost uniformly based on wealth (of students and time to finish degree; of faculty resources; of endowment for students), not quality.

Catasetumkid

Mon, May 13, 2013 : 6:28 p.m.

Last time I checked, UM was THE top public university in the country.

MikeB

Mon, May 13, 2013 : 2:17 p.m.

Given the outstanding job she has done she likely could be paid more. Those paid more than her (Public Institutions) have nowhere near the academic rankings of Michigan and her success as a fund raiser and the management of the endowment fund have been exemplary. Bottom line Michigan is in great shape and attracts top students from around the world.

blue85

Wed, May 15, 2013 : 1:55 a.m.

"Would the University get all of the donations that they do if people found out how they stop investigations of questionable doctors (see comment another person made on 'child porn.'... and all of their cover-ups." Probably not, but is that the right question to ask? Money is not a panacea, but do you think an organization that is underperforming will be improved by NOT spending the money to revamp the process and to rehire into the now vacant position? Do you think the people who support the med school donate based on mortality and morbidity or on the bet that things can be improved? If your glass is always empty, and I suspect it is based on your question, then you'll always be able to find the 1 to 5 errors in judgement out of the hundreds or thousands of decisions and drop a red flag. Yes, this was a horrific event, and changes needed to be made and were made, but choking off donor support is hardly a rational expectation or solution to the problem.

sheri barron RN,BSN

Mon, May 13, 2013 : 8:12 p.m.

Would the University get all of the donations that they do if people found out how they stop investigations of questionable doctors (see comment another person made on 'child porn.'... and all of their cover-ups.

A2since74

Mon, May 13, 2013 : 1:24 p.m.

President Coleman earns her pay. So do the presidents of all leading institutions of higher education in this country who are doing a good job of education and research.

Ralph

Mon, May 13, 2013 : 1:23 p.m.

Who is the highest paid public employee in the State of Michigan? Answer: Tom Izzo, Michigan State Basketball Coach. In fact football and basketball coaches are the highest paid public employees in 90% of the states.

Dog Guy

Mon, May 13, 2013 : 1:06 p.m.

Ann Arbor basks in the glow of another top-10 list.

GoNavy

Mon, May 13, 2013 : 11:29 a.m.

Readers should be aware of the annual 3% raises that nearly every employee at the University receives (the information is public; you can see each employee's pay by year along with the raise given). Keep in mind that if you made $100 10 years ago, and earned a 3% raise every year since, you would be making $134 - 34% more than when you started. Ask yourself: Are we in a position in 2013 to be paying 34% more to employees for essentially the same work as we did in 2003? When we think about how college costs have increased, and how we've yoked the young with debt burdens equivalent to a mortgage payment, these questions gain legitimacy.

blue85

Wed, May 15, 2013 : 1:50 a.m.

"Keep in mind that if you made $100 10 years ago, and earned a 3% raise every year since, you would be making $134 - 34% more than when you started. Ask yourself: Are we in a position in 2013 to be paying 34% more to employees for essentially the same work as we did in 2003? " This is not a context for either linear or geometric analysis. The right questions are: 1) what is the task complexity; 2) has the complexity increased; 3) have the challenges been steady or increasing; 4) have resources gone up or down; 5) has the performance equaled or met expectations. Simply compounding dollars tells us nothing.

Jay Thomas

Tue, May 14, 2013 : 5:08 a.m.

Ghost, you're getting your way. Last I heard Obama wanted to cut education benefits for the military.

Edward R Murrow's Ghost

Mon, May 13, 2013 : 3:01 p.m.

@Jake C: Not sarcastic, exactly. Just posting a similar example that would illuminate the sheer silliness of the statement. What's good for the goose . . . And FYI, before anyone goes off in ignorance and charges me with lack of patriotism, I retired from the Army after 25 years of service to my nation. GN&GL

MikeB

Mon, May 13, 2013 : 2:20 p.m.

What debt? The University has no real debt, the State has no debt and paying people a good wage (You do know that UM gets a small percentage of its budget form the State and tax payers don't you)? Student debt is another issue and they willingly sign up for it and all good schools have extensive financial aid programs so giving employees a good wage is not wrong at all

Jake C

Mon, May 13, 2013 : 2:04 p.m.

Note: my comment was directed at GoNavy, I understood ERMG's comment was just slightly sarcastic.

Jake C

Mon, May 13, 2013 : 2:02 p.m.

Have you ever worked in a business before? Have you ever had to work with someone who's been on the job for 3 months, compared with someone who has 10 years of experience? In the vast majority of cases, the person who's been there longer will contribute at *least* 34% more value to the organization than the person who was recently hired, even if they have a similar education background. Especially since it's the veterans who are helping to teach the new hires on a daily basis, in addition to doing their daily jobs.

Edward R Murrow's Ghost

Mon, May 13, 2013 : 12:38 p.m.

I feel the same way about the military, and ESPECIALLY about the Navy. They're doing the same thing they were 10 years ago. What's the added value that justifies the 33% pay increase they've received over the past decade (The above calculation employs the pay for an E6 over 6 as the baseline and the 2003 and 2013 pay tables that are readily available on the internet) GN&GL

SonnyDog09

Mon, May 13, 2013 : 11:27 a.m.

She still makes less money than several college football and basketball coaches in this state do.

blue85

Wed, May 15, 2013 : 1:48 a.m.

"How many games has she won?" If you blame her for RichRod you should give her credit for all of the victories as well.

a2citizen

Mon, May 13, 2013 : 5:34 p.m.

How many games has she won?

joejoeblow

Mon, May 13, 2013 : 11:19 a.m.

I have the solution!!!! UofM should fire her and hire me. I'll do it for half the cost with a smile! I have no experience and have many faults, but the people on here don't seem to care about quality. Okay, Okay, you got me, I'll do it for 1/4 the money!

music to my ear

Mon, May 13, 2013 : 11:13 a.m.

good for her, she is up there with the big dogs,Mary sue has been" leaning in" a long time, she has done an outstanding job.

Pablo

Mon, May 13, 2013 : 11:04 a.m.

Should we be proud or ashamed that we have to pay that kind of money? How much goes to her staff who surely make her look good? What can one person do with that kind of income? Hourly wage would be what? I thought we were a public university.

aakapoic

Mon, May 13, 2013 : 3:46 a.m.

I loathe having to join any .com discussion, but I think Mary Sue Coleman has been an excellent leader of an institution that has few equals in higher education in the world. As an alumnus of U-M, I have been impressed with her thoughtfulness, her choice of initiatives and well, I just like her. If she has the sixth-highest salary of public university leaders, she's underpaid. It's time education was a priority again...

GoNavy

Mon, May 13, 2013 : 11:30 a.m.

Recognize what Ms. Coleman does, exactly: She's the fundraiser-in-chief. She is not like the CEO of a corporation. We have an elected board of regents, dozens of college department heads, and hundred more lower-level administrators.

Kai Petainen

Mon, May 13, 2013 : 2:59 a.m.

Her annual car allowance is $1,920??? That's it? That's really low... a President of a University should get more than that for that... Is that number right?

grimmk

Mon, May 13, 2013 : 10:34 a.m.

Seriously? She gets paid well enough to cover any extra expenses! What do you think that will cut into her yacht fund?

widmer

Mon, May 13, 2013 : 4 a.m.

Maybe because she lives on campus? (lol, just trying to add some comic relief here amid all the people who are angry jelly)

beardown

Mon, May 13, 2013 : 2:57 a.m.

It's interesting that people are up in arms over the fact that the leader of the biggest job provider in Ann Arbor makes a small portion of the total money she brings in (endowment and donations). But yet, no one has an issue with the salaries of the people who run Government Motors, I mean General Motors, or Ford or any other company that receives or received bail out dollars or tax credits/grant money (who paid for the hybrid tech? we did).

Jay Thomas

Tue, May 14, 2013 : 5:14 a.m.

JoeJoe: Some people are like that. Granted. But it's a little different when it is money taken from you by force (i.e. tax money) and the recipients are making almost a million dollars and never find themselves missing a COLA adjustment like normal people do all the time.

joejoeblow

Mon, May 13, 2013 : 11:17 a.m.

You obviously don't read the comments on here often. People are up in arms about anyone making more than them. During the Government Motors days, people commonly ranted on here on how the CEO's should be making nothing. In fact, when they showed up to congress to beg for money, using private jets, people blasted them like crazy (odd, no one bashed congress for flying on private jets, in my books hypocritical as they too are on the government dime).

Jay Thomas

Mon, May 13, 2013 : 3:56 a.m.

I don't think she brings in that money in the way you obviously do.

Kai Petainen

Mon, May 13, 2013 : 3:36 a.m.

I'm not up in arms about her salary... but I am curious to know if she'll retire from JNJ. GM is a $43 billion company. JNJ is a $241 billion company. So she's a key person at a company bigger than GM, as she happens to be one of the top insiders at JNJ. So any high level deals with JNJ and UofM, she would know about and she would be 'material' for JNJ. Remember how PFE left Ann Arbor? Well, from 2008 until now PFE is up +43%. But, JNJ is up only 28%... so PFE is beating JNJ. But, in the past year, JNJ has been rocking -- it is up 33%; whereas PFE is down -15%. It was also back in 2008 that JNJ bought an Ann Arbor firm. In theory... some would view her retiring from JNJ as material... and so if she was to retire from there... that info should be made public before others had a chance to trade on that info.

Kai Petainen

Mon, May 13, 2013 : 2:51 a.m.

"Coleman also serves on the executive boards of Johnson & Johnson and Meredith Corp. She took home $425,400 in 2011 for her service on those two boards, according to a Chronicle database derived from U.S. Exchange Commission filings." It's good that you included this -- it makes the article much more complete. I asked JNJ for a comment about her retirement and they had no comment. She represents both UofM and JNJ. As she retires from UofM, I'm curious to know if she'll retire from JNJ as I'd wonder what material impact it could have on JNJ? I'm also curious to know the stance on e-cigarettes by UofM and JNJ -- if they are against tobacco then what about e-cigarettes? I believe she has 14,352 shares of stock at JNJ, and 18,584 in options. The stock is worth about $1.2 million. Question -- how much did she make from SPARK, the MEDC and the Gerald Ford Foundation? (for the Ford foundation does the 990 form list 20 hours per week? or 0.2 hours per week?)

blue85

Wed, May 15, 2013 : 1:46 a.m.

"If it is a "top flight university" then it should occupy your full attention." The benefits flow from several directions: Coleman gets paid and UM gets profile with a major hiring entity; Coleman probably also gets insight into industry trends for research, expenditures and hiring. Yes, she profits handsomely, but there are benefits to the university, which is why all university's allow this sort of "moonlighting".

Jay Thomas

Mon, May 13, 2013 : 3:54 a.m.

If it is a "top flight university" then it should occupy your full attention.

Kai Petainen

Mon, May 13, 2013 : 3:02 a.m.

@beardown... I'm not complaining about her salary... that's for others to debate.

beardown

Mon, May 13, 2013 : 2:58 a.m.

Who cares? She could make Bill Gates-like money outside of her work at the university, but her salary is commensurate with a president at a top flight university.

joejoeblow

Mon, May 13, 2013 : 2:15 a.m.

That's what I'm talking about! About time a woman can break the glass ceiling.

sheri barron RN,BSN

Mon, May 13, 2013 : 1:41 a.m.

I would really like to see her earn her money this year by making things right. No promotions or pay raises for those who try to cover up the UM's wrong doings.

Jay Thomas

Mon, May 13, 2013 : 3:52 a.m.

What about continuing to moonlight for 250k/year while forbidding other UofM employees from doing the same thing.

JBK

Mon, May 13, 2013 : 1:29 a.m.

Too funny! Almost a day after a report came out ranking UofM 71st in the country for "bang on the buck." UM was sandwiched between the University of Maryland and Rutgers. How funny is that? For a complete listing of how over rated UM is, go to: http://www.payscale.com/college-education-value-2012

blue85

Wed, May 15, 2013 : 1:43 a.m.

Many students stay in Michigan, where the economy is not very robust. If you have ever taken a business course, you would know that you don't use dollars to rank projects if you have an IRR measure (especially relevant in this case given both the situs of the graduates and the weak local economy). On an IRR basis, Michigan ranks 23 in the nation for annual IRR.

Edward R Murrow's Ghost

Mon, May 13, 2013 : 12:32 a.m.

"Nobody but knowledgeable insiders really has any idea what the value of the U's research is and when something valuable is found, it is sold off for a song to enrich the said insiders while the dud research is paid for by the public." Nobody knows--but YOU know valuable research is sold for a song while dud research is paid for by the public? Seems like a non-sequitur. That said, 1) How does one define "dud research"? 2) Examples of valuable research sold for a song? 3) Examples of dud research?

blue85

Wed, May 15, 2013 : 1:36 a.m.

"Ghost, the U earns about $50 million in royalties but spends about $1 Billion on research for a grand return of about 5% on the investment. To me, that's about $950 million in dud research from a return on investment point of view. " Every additional post that I read by you convinces me that you are financially speaking completely illiterate: 1) businesses in this nation over the last 100 years have returned roughly 5.7% over bonds; 2) it is accepted by anybody who understands and writes about accounting that expenditures are made to generate revenue and those expenditures are not considered "dud" but a cost of doing business; 3) this is mostly pure not applied research and the knowledge found is used to fundamentally alter machine/drug/process/manufacturing to the benefit of the entire world. "Research in pure physics should not be expected to return its costs, but why should private individuals reap the financial benefits of this public research?" Please enumerate all of those private individuals who have reaped private profit from the pure physics research at Michigan? I seriously doubt you can name 1 over the last 100 years. "Have you ever heard of the idea of Socialism for the Rich or public cost but private profit? Once again, the U has raised tuition and housing costs much faster than household incomes have increased in Michigan over the last 30 years--to dump the costs of supporting a large research budget on families trying to pay tuition is simply not fair." As noted above, this is a horrendously inapposite "analysis"; state cuts equal tuition increases. Look at any year over the last 10 years; compile the state cuts and compile tuition increases; graph the results.

Edward R Murrow's Ghost

Mon, May 13, 2013 : 3:37 p.m.

Good to know what you think constitutes dud research--it must make money. By that standard, almost all cancer research ought immediately cease. GN&GL

Stuart Brown

Mon, May 13, 2013 : 7:40 a.m.

Ghost, the U earns about $50 million in royalties but spends about $1 Billion on research for a grand return of about 5% on the investment. To me, that's about $950 million in dud research from a return on investment point of view. Research in pure physics should not be expected to return its costs, but why should private individuals reap the financial benefits of this public research? Have you ever heard of the idea of Socialism for the Rich or public cost but private profit? Once again, the U has raised tuition and housing costs much faster than household incomes have increased in Michigan over the last 30 years--to dump the costs of supporting a large research budget on families trying to pay tuition is simply not fair.

Edward R Murrow's Ghost

Mon, May 13, 2013 : 12:29 a.m.

"The University has become one big money machine concerned only with maximizing its profits." Question: Exactly how much profit did the UofM realize last year? "I continue to remain amazed at the U's ability to increase the cost of attendance by double the rate of inflation every year over the last 30 years." Question: Source for this claim? Question: Even if it is true, is this any different from any other top tier public institution? "The consequences are real and not funny" Question: What, exactly, are those consequences? GN&GL

Stuart Brown

Thu, May 16, 2013 : 2:26 a.m.

blue85, You claim elsewhere that undergraduates cost the U $35K/year; hogwash, the truth is that administrative and non-academic costs per student have skyrocketed since the days of the state paying 80% of the general fund expenses. Why should undergrads and their families pay for this? The U has not even been able to keep room & board costs in line with inflation over the last 30 years. I reject the notion that a History or Math major should have to subsidize the U's bloated overhead.

blue85

Wed, May 15, 2013 : 1:30 a.m.

"For many years tuition increases at major universities were going up at around twice the rate of inflation." Utterly false: CPI over the last hundred years has been around 3.25%/year; HEPI...the higher education index, has been around 4.1%/year. At UM, the increase has been around 5.5%/year...but it is false to refer to inflation when the manifestly obvious driver is state budget cuts. University increases are equal and opposite in sign to state budget cuts. "It was pointed out in every part of the media. Of course the rate of inflation has risen considerably so that is no longer the case (as well as the U cutting the rate of increase in the last few years in response to COMPLAINTS)." No, no, and no. Inflation is close to a historic low. Look at the yield curve, which is also at a historic low. When you measure inflation, you use a basket with something like 30,000 items. Running a university means paying for thousands of items. Just because you anecdotally experience inflation in your household basket means nothing relative to UM inflation: how many wind tunnels did you maintain last year; how many professors did you bid for in the labor market?

arborarmy

Tue, May 14, 2013 : 9:39 a.m.

Yes, Stuart. I had a typo in my last. Good catch. When you eat out, you pay for more than the food on your plate. Expensive restaurants are expensive for reasons having little to do with the actual cost of the food on one's plate. That you don't understand that belies your simplistic view of the university's finances.

Stuart Brown

Tue, May 14, 2013 : 4:46 a.m.

Arborarmy, Where to begin! First, no, I did not attend "Ross Scholl"; I studied Physics in the LSA school. Counter girl at Micky D's? When I do eat out, it is the food I pay for; likewise, when I payed tuition, it was the instruction I was paying for. My son will pay about double relative to his expected earnings for the same quality of instruction I got; you don't see a problem with this? And yes, I do know about comparable institutions; let's take one example of a not-for-profit institution abusing its stakeholders and one not abusing its stakeholders. The two examples I will compare are the U's dorm housing versus the ICC (Inter-Cooperative Council in Ann Arbor) You see, in 1981 I moved from Alice Lloyd Dorm to Michigan House Cooperative and my living expenses went down from about $300($768 in 2013)/month to $220($563 in 2013)/month. Fast forward to 2013, and dorms cost $1219/month while Michigan House costs $602/month. Explain that one! The ICC's costs are mostly in line with inflation while the U's dorms over 50% more expensive.

Stuart Brown

Tue, May 14, 2013 : 3:51 a.m.

blue85, HEPI index? This index includes the bloated salaries that admins like Mary Sue Coleman get. Get real, the CPI-U index the BLS calculates is the major index most people think of when talking about inflation. The CPI-U since 1981 is about 3%/year while UofM's tuition increases over the same period are about 5.7%/year. US median Household income in 1981 was $17,606/year and $48,152/year in 2011; or tuition was about 12.5% of median income in 1981 and about 25% of median income in 2011. Am I ticked that while the cost vs median income has doubled while the salaries graduates earn is about the same in real terms one would get in 1981? You bet I am! The U claims, that while this is true, it is not their responsibility since the state cut their funding by "over 50%." 50% of what? Why is it the state's responsibility to keep up the dramatic increase in spending per in-state student on admins and non-teaching support services since the 1960's?

arborarmy

Mon, May 13, 2013 : 9 a.m.

It appears Mr. Brown did not attend the Ross Scholl. 1) the difference between the counter girl's sales and her pay is not profit for Mickey D's. Similarly Mr. Brown's wildly simplistic example. 2). I believe ERMG asked about trends in higher Ed. You've not answered the question. How did not answering the question work out for you when you were a "student" at the U? And the reason one compares comparable institutions is to compare comparable costs, practices, etc... Someone who had been a "student" at the U would understand the purpose of a comparative analysis. 3). The number of people seeking admission to the U remains high, much larger than the number of slots will bear. That hardly seems to suggest that the price of a Michigan education. Guess when a "student" at the U you didn't learn about supply and demand?

Stuart Brown

Mon, May 13, 2013 : 7:24 a.m.

Ghost, Have you ever attended a class at UofM like Chem 101? I did, and I recall sitting amongst 150 undergrads with one professor and an assistant teaching the class. Today, the same class would be attended by about 75 out-of-state students paying roughly $3900/class and 75 in-state students paying roughly $1300/class for a total of $390,000 in revenue versus the professor's annual salary of $120,000 to teach four classes or $30,000 per class. That looks like a pretty good profit to me. Oh yeah, UofM is a "non-profit" so the surplus from our chem 101 class can now be blown on value-added items like Mary Sue Coleman's bloated salary--enabling Mary Sue to prattle on about the reason tuition needs to shoot up at an annual geometric rate of double the rate of inflation over 30 years is due to the state not pouring more money into the University system. Ghost, "...Question: Source for this claim?" and " . . which is why I asked the question." Answer: my own experience and the inflation calculator at bls.gov. I paid $2200 for tuition in 1981 and today this tuition would cost about $13,000-->the geometric increase over 32 years is 5.7%/year when inflation is 3.0%/year meaning the U is roughly increasing tuition by every year for the last 32 years by about double the rate of inflation. Of course, this CPI index does not take into account the drop in median household income over the last 5 years now does it? Ghost, "Question: What, exactly, are those consequences?" No student debt crises in your world, Ghost? In the world I live in, the generation coming up has it much harder than I did, and I don't think I had it so easy. And just because other institutions are doing it, it makes it O.K.? I say NOT!

snark12

Mon, May 13, 2013 : 4:50 a.m.

The annual inflation rate hasn't been over 3.5% since 1992. It's been trending down, if anything, in recent years.

Jay Thomas

Mon, May 13, 2013 : 3:50 a.m.

For many years tuition increases at major universities were going up at around twice the rate of inflation. It was pointed out in every part of the media. Of course the rate of inflation has risen considerably so that is no longer the case (as well as the U cutting the rate of increase in the last few years in response to COMPLAINTS).

Edward R Murrow's Ghost

Mon, May 13, 2013 : 12:53 a.m.

. . . which is why I asked the question. GN&GL

blue85

Mon, May 13, 2013 : 12:51 a.m.

""I continue to remain amazed at the U's ability to increase the cost of attendance by double the rate of inflation every year over the last 30 years."" He can't support this claim: 1) as posted above, UM has increased its costs at a relatively low rate; 2) for a family making less than $80,000, it is cheaper to go to UM today than in 2004; 3) if you actually calculate the increase, he is factually wrong; 4) inflation in the HEPI index used for education is around 4%/year and the UM increase is about 5.5% over a time span when state support has declined by over 50%. Thus his "arguments" are utterly without foundation.

Stuart Brown

Sun, May 12, 2013 : 11:19 p.m.

The Regents should slash the salaries of all admins by 50% and use the savings to cut tuition and room and board charges. Remember, the U is a public, non-profit (LOL) institution. Mary Sue Coleman represents everything that is wrong with the way UofM uses its resources. The University has become one big money machine concerned only with maximizing its profits under leaders like Coleman in the last few years. I for one, will be glad Coleman is gone but I am not optimistic anyone any better will be found to replace her. I must admit, I continue to remain amazed at the U's ability to increase the cost of attendance by double the rate of inflation every year over the last 30 years and am curious to know when the trend will finally end. The lame excuses used to justify these increases would make me laugh if we were talking about a comedy show; except the consequences are real and not funny.

Stuart Brown

Mon, May 20, 2013 : 1:48 a.m.

blue85, Thanks for showing any who are paying attention what an insider's view is of the rest of us. I understand fully the group think prevalent in the upper echelons at UofM. No public accountability and a highly entitled attitude are the best ways to summarize it. Oh and BTW, if I was as ignorant as you flippantly claim, you would not have spent the time flaming my posts. To wit, "Snubbed the President? What alternate planet do you live on? In what wise did she snub him?" What alternate planet? Earth, but I do recognize that perched from on high where you sit, it may seem like a distant planet. In what way did she snub him? Mary Sue Coleman was invited to a round-table discussion on tuition increases last December 5th which she declined, siting prior commitments. When the POTUS asks you (the President of a major University) to participate in a public event, you make time! This can only be seen as a snub; it also shows the contempt for the public's right to know. I have no doubt the U spends $35K per student, but based on my own experience, I doubt that most undergrads ever see the fruits of much of this spending in any reasonable way. The example of Chem 101 I gave elsewhere on this topic shows the marginal costs of providing instruction to undergrads can be a very small percentage of the tuition paid to the U.

blue85

Wed, May 15, 2013 : 1:25 a.m.

"I maintain that admins like Mary Sue Coleman are the problem, not the solution--asleep at the switch while the pundits ponder if the next debt bubble is the student debt crisis. Mary Sue's answer to my question in 2002 shows she is simply out of touch with her major stake holders. She even snubbed the President of the US when he came to campus the last time (he only makes about $450K per year when she gets about double that) when the focus was on excessive tuition hikes at places like UofM." Snubbed the President? What alternate planet do you live on? In what wise did she snub him? The university has carved millions out of its cost structure and continues to rationalize operations. The university has also earmarked hundreds of millions in endowment to generate scholarships and spends well over $100,000,000 in tuition support per annum. It has also announced that student support will be the focus of the next capital campaign...evidenced already by the Zell gift for MFA support. You've made a lot of assertions about the subjective world (the U's view and their animus and desire to "gouge") which you can't support; and assertions about the lack of efficiency, without any foundation. The fact is that the annual costs are probably well over $35,000/year, as at any elite school, and state support is nugatory...the U fills the gap with donor funds, federal research money, and tuition increases. You haven't offered a single cogent thought as to how the budget is constructed or as to why you have superior expertise relative to the experts. Pretty unpersuasive stuff from your side.

blue85

Wed, May 15, 2013 : 1:20 a.m.

"; contrast that with the current charges of $6500 per semester. Older graduates from the 1960's say they could pay their in-state tuition by scalping their football tickets! Sounds to me like the U in those days tried to offer a first class education without gouging the students--unlike the U of today." You don't understand accounting, or even basic math: the in state tuition support was far higher. Are you arguing that state contribution can go down and student contribution will not go up? Why would the university "gouge" students? What is the source of the animus that your words/posture imply? "In 2002 I was personally able to ask Mary Sue Coleman on a state wide call-in radio show what value added services undergrads in 2002 were getting that their parents in 1975 did not get given that the real cost of tuition had risen by a factor of 2.5 over the time period. The lame answer I got from your brilliant University President was, (drum roll): "lots!". " She was brilliant enough to sense your animus/disengagement and gave you the answer you deserved. "Although Mary Sue could not name a specific item--she assured the public that 1) the tuition was worth it and, 2) it was the states fault that funding did not keep up with the U's bloated cost structure." Yes, and various salary surveys support the assertion as to tuition, and state funding cuts support the current tuition framework. I'm guessing that you have never budgeted for an entity with more than 10 employees and don't have a glimmer as to where most/all of the numbers come from.

blue85

Wed, May 15, 2013 : 1:16 a.m.

"You fail to mention that UC Berkeley still charges in-state students less than UofM does. " Pretty impressive elision on your part: I posted the Berkeley numbers in my post above. So you are either lying or preliterate, which is it? "The sophistry you use in your numbers is revealed by your short time span of only 10 years. Look at the last 30 years" Why stop at 30 years, why not go back to when the state contribution was $1.3Bn/year? Why not look at tuition in those days? "--in 1981 I paid $1100 per semester which in today's dollars is $2817" And what was the state's per student contribution?

blue85

Wed, May 15, 2013 : 1:11 a.m.

"Strike a raw nerve did I, blue85?" No, bald assertions and opinion mean nothing to me. Your logic is vacuous and your support void. "And yes, not-for-profit means the institution in question does not pay income tax on its positive cash flow or surplus; given the revenue maximizing focus of the U at the expense of its stakeholders, your criticism of my post is nothing but self justifying obfuscation." Again, what brand of telepathy do you use to divine that revenue maximization is the focus, and again, given the fact that words should have meaning, and profit, in this context, has no meaning, what is your point? I don't work for the U, so what am I "self justifying"? What have I tried to obscure? If your reading comprehension is above the high school level, the clarity should be quite acceptable.

Stuart Brown

Tue, May 14, 2013 : 3:10 a.m.

fordprefect, UofM claims that their state funding per student is down the last few years but they apparently include out-of-state students who should have no expectation of benefiting from state funding. I find it disingenuous that the U carps the state for reduced funding when it is the University that has chosen to dramatically increase staffing expenses per student since the early 1960's.

fordprefect

Mon, May 13, 2013 : 3:15 p.m.

Well, Stuart, if we actually look at the numbers from the times you bring up as well, you'd see that state funding to the U has dropped precipitously since the time you were citing. In the 1960s, nearly 80% of the University's funding came from the state. In the '80s, it was down to 60%, but now, it has dropped to less than 20% of the the budget. The fact of the matter is, that state funding could drop tuition dramatically. You act as if nothing but relative tuition prices have changed since your time at the University, but it's not that simple. http://www.vpcomm.umich.edu/pa/key/understandingtuition.html Rising tuition costs are endemic in our country these days. Some of this probably can be attributed to rising costs in education or waste in the system, and we should strive to eliminate this, but we also have to deal with the fact that we as a country don't seem to be able to invest as much into education as we once did. This hurts public schools and forces them to raise costs to compensate.

Stuart Brown

Mon, May 13, 2013 : 5:44 a.m.

Strike a raw nerve did I, blue85? And yes, not-for-profit means the institution in question does not pay income tax on its positive cash flow or surplus; given the revenue maximizing focus of the U at the expense of its stakeholders, your criticism of my post is nothing but self justifying obfuscation. You fail to mention that UC Berkeley still charges in-state students less than UofM does. The sophistry you use in your numbers is revealed by your short time span of only 10 years. Look at the last 30 years--in 1981 I paid $1100 per semester which in today's dollars is $2817; contrast that with the current charges of $6500 per semester. Older graduates from the 1960's say they could pay their in-state tuition by scalping their football tickets! Sounds to me like the U in those days tried to offer a first class education without gouging the students--unlike the U of today. In 2002 I was personally able to ask Mary Sue Coleman on a state wide call-in radio show what value added services undergrads in 2002 were getting that their parents in 1975 did not get given that the real cost of tuition had risen by a factor of 2.5 over the time period. The lame answer I got from your brilliant University President was, (drum roll): "lots!". Although Mary Sue could not name a specific item--she assured the public that 1) the tuition was worth it and, 2) it was the states fault that funding did not keep up with the U's bloated cost structure. I maintain that admins like Mary Sue Coleman are the problem, not the solution--asleep at the switch while the pundits ponder if the next debt bubble is the student debt crisis. Mary Sue's answer to my question in 2002 shows she is simply out of touch with her major stake holders. She even snubbed the President of the US when he came to campus the last time (he only makes about $450K per year when she gets about double that) when the focus was on excessive tuition hikes at places like UofM.

beardown

Mon, May 13, 2013 : 3:05 a.m.

blue85, how dare you use logic and actual real numbers.

blue85

Mon, May 13, 2013 : 12:46 a.m.

"Mary Sue Coleman represents everything that is wrong with the way UofM uses its resources." This is great stuff for the revival meetings and whilst distributing pitchforks to the other villagers, but what is your support for the contention? UM is nationally recognized as a model for university governance, but it is good to hear that further improvements are possible under your aegis, so I'll await with bated breath your contributions to the next regent's meeting. Let me know when you show up, as has Coleman, as a top10 ranked university administrator, and when you'll be profiled in the Chronicle of Higher Education. "The University has become one big money machine concerned only with maximizing its profits under leaders like Coleman in the last few years. " You can put it in quotes if you want to but UM is in fact not-for-profit...in that context, maximizing profit is a meaningless phrase that is not supported by facts, by accounting convention or by your ability to cite anything other than a bald assertion. What is your support for the contention which you are making? "I for one, will be glad Coleman is gone but I am not optimistic anyone any better will be found to replace her. " You are right: she is nationally ranked, nationally respected, and the few leaders who might come close are all paid more than she is. As a final thought, what should she be paid for managing: $5bn in real estate; $1.2bn in research; $6Bn in budget authority; $8Bn in endowment funds; 40,000 staff and 50,000 students? Dazzle us with your concrete insights into the going rate for a person who can manage an institution of this size in the face of relentless budget cuts, shrinking resources, and a soft national economy.

blue85

Mon, May 13, 2013 : 12:38 a.m.

So, for both residents and non residents, UM is increasing tuition at a relatively low level compared to another university which includes UM in its peer group. For 2001-2011: http://oir.uga.edu/reports/Tuition_And_Fees_Comparison.pdf Residents The average 10-year increase in tuition and fees for residents was 117%. The University of Georgia's increase was 156%, 2nd highest out of 13 institutions. The largest increases occurred at University of California - Berkeley (165%), University of Georgia (156%), and University of California-Los Angeles (155%). The lowest increases were at University of Michigan (71%), Pennsylvania State University (95%), and Cornell University (State) (95%). Over the past 5 years University of Georgia has had the highest increase (89%), followed by University of California - Berkeley (68%) and University of California-Los Angeles (66%). Over the past 5 years Pennsylvania State University has had the lowest increase (25%), followed by University of Michigan (28%) and The University of Texas (35%). Non-Residents The average 10-year increase in tuition and fees for non-residents was 90%. The University of Georgia's increase was 138%, 2nd highest out of 13 institutions. The largest increases occurred at The University of Texas (209%), University of Georgia (138%), and University of California - Berkeley (123%). The lowest increases were at University of Wisconsin (52%), University of Minnesota (59%), and University of Michigan (66%). Over the past 5 years The University of Texas has had the highest increase (91%), followed by the University of Georgia (60%), and University of California – Berkeley (41%). Over the past 5 years University of Minnesota has had the lowest increase (18%), followed by University of Wisconsin (20%), and Pennsylvania State University (21%).

a2citizen

Sun, May 12, 2013 : 11:07 p.m.

It's nice to know where my tax dollars are going.

blue85

Wed, May 15, 2013 : 1:06 a.m.

"@Blue85: You also left out the trillion dollar student loan nightmare we are all being saddled with at the federal level." Way to hijack the thread: you've gone from Coleman and the University to...well what is your point...that UM or Coleman have saddled students in Michigan with that debt? As the school notes, it is cheaper for a family under $80,000/year to send a child to Michigan today than 10 years ago. So what is your point and where is the support for it?

blue85

Wed, May 15, 2013 : 1:04 a.m.

"blue, you left out the $1 billion in research grants." You mean the money that comes into Michigan from outside of Michigan which you as a resident taxpayer don't contribute to but which you as a resident in a prosperous county benefit from? Yes, I should have included those monies. UM brings in more like $1,250,000,000, most of it "new money" to the state of Michigan and that helps to close the budget gap the university must contend with because the citizens of the state, possibly you among them, can't or won't fund education.

Jay Thomas

Mon, May 13, 2013 : 3:44 a.m.

@Stuart: That was my assessment as well. The financial return on the research being down is so minuscule it isn't even funny. @Blue85: You also left out the trillion dollar student loan nightmare we are all being saddled with at the federal level.

a2citizen

Mon, May 13, 2013 : 1:31 a.m.

blue, you left out the $1 billion in research grants.

blue85

Mon, May 13, 2013 : 12:48 a.m.

Just think, of a $6Bn budget "your tax dollars" are a pretty laughable $325MM or so...call it 5%. You are getting a world class/ranked research institution to stabilize your local property values and make Ann Arbor desirable all without really shelling out any money. Your concern about your tax dollars is belied by the fiscal realities.

Stuart Brown

Sun, May 12, 2013 : 11:25 p.m.

Down a sink hole into some admin's pocket. UofM pays about 2.5 times the average construction cost for student housing or about $500/sq-ft. Nobody but knowledgeable insiders really has any idea what the value of the U's research is and when something valuable is found, it is sold off for a song to enrich the said insiders while the dud research is paid for by the public.

ann_arbor_guy

Sun, May 12, 2013 : 10:41 p.m.

It sounds like she was underpaid, maybe when they find her replacement they will have to pay them more.

Jay Thomas

Mon, May 13, 2013 : 3:42 a.m.

That's how it always works. The truth is the regents could cut the pay to 500k/year and have a boatload of qualified applicants.