Despite misgivings about allowing university and college presidents to be subsidized by nonpublic funds, a Board of Regents committee voted Friday in favor of the idea.
If the full Board of Regents accepts the unanimous decision by the executive evaluation and compensation committee, private donors will be able to sweeten the pay of a university or college president.
"We just can't continue to keep competing in this environment of escalating salaries," Regent Steve Sisolak, the committee chairman, said.
The decision on whether to boost salaries using private money has been under consideration by regents for some time. Recent state budget shortages prompted the decision to stop relying so heavily on state funding alone.
Before Friday's 5-0 vote, skeptics brought up the last time private donors were in the equation, much to the regents' embarrassment.
Nine years ago regents learned that Robert Maxson, the former president of the University of Nevada, Las Vegas, struck a secret deal to boost the salary of Rollie Massimino, then the basketball coach, by an additional $375,000 a year using a private money.
A Nevada law prevents public officials from receiving money from outside sources, and the state Ethics Commission indicated the agreement violated state law.
"You know the old saying, he who pays the piper chooses the tunes," Regent Jill Derby said Friday.
Sisolak replied, "The person paying the piper is running out of money."
The committee was able to get around that state law forbidding salary supplements by allowing the university or college foundation to act as the go-between.
"Outside sources would have to be unrestricted gifts or donated specifically for that purpose," said Tom Ray, general counsel for the University and Community College System of Nevada.
Private consultant Ray Cotton, who conducts presidential salary studies, said Friday's decision was a good one.
"I applaud the board for doing it," said Cotton, vice president of education for ML Strategies LLC, based in Washington. "There was a time when people thought that presidents of public institutions should make less than private presidents, but it is becoming quite the opposite."
Cotton said Nevada is merely bringing itself up to the competitive level of other states that are also supplementing public salaries with private dollars.
A 2002 survey by the Chronicle of Higher Education found that about a third of 131 public-university presidents received supplemental compensation from private sources.
Many of those earned more than $500,000 a year.
In contrast, university presidents in Nevada earn no more than $209,000 a year plus a housing and car allowance that totals $31,000 a year.
One detail left to work out, though, is how open Nevada should be in releasing information on donors.
Typically donor information in this state is held private, although other states, such as Wyoming, disclose the names of all of the donors who contribute to a president's salary.
Texas takes the opposite approach, giving out little information.
"I think given its history, (Nevada) should take the Wyoming position to instill public confidence in the systems for paying the university presidents," Cotton said.
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