Executive Compensation at Vanderbilt University

Vanderbilt University is one of the top private universities in the South and in the USA.  At nearly $70,000 a year for tuition, room, and board, Vanderbilt’s fees are right in line with other top private colleges and, yet people still wonder why a 4-year education at Vanderbilt costs nearly $300,000?

The answer: tuition dollars are supporting a huge education machine where, in the case of Vanderbilt, nearly half of the total expenses ($640 million out of $1.4 billion in expenses, not including depreciation) are compensation-related costs for the 37,165 employees in 2016 (an average of $17,000 per employee – compare this to $75,000 at Yale, $68,000 at Penn and $64,000 at Princeton) although the prior year, it is interesting to note, $2.3 billion was used to compensate 36,272 individuals, which equates to an average of $64,000 – more in line with the industry averages above. The IRS Form 990 offers no explanation explaining this discrepancy.

The next largest expense categories were grants ($333 million – mostly for student financial assistance) followed by $175 million on office-related expenses (occupancy, IT, office, insurance).

In 2016, Vanderbilt reported $1.3 billion in total revenue, $952 million of which came from program service revenue (i.e. tuition, room and board, etc) and $326 million from contributions (including $194 million from government grants). The remaining revenue – about $14 million (which equates to less than 1% return on the $6 billion in net fund assets) – came from investment income while $33 million came from  royalties, rental income, and the sale of assets.

Vanderbilt reported spending about $100 million more than revenue in 2016. In addition, the university posted a nearly $200 million charge to net assets from “discontinued operations” (no detail provided) and a $236 million reduction in net assets due to a net unrealized loss on investments to end the year with $5.4 billion compared to $6 billion at the end of the previous year.

The Form 990 (2015 for the year beginning July 1, 2015 and ending June 30, 2016) reported 3,721 individuals received more than $100,000 in compensation, with the 22 most highly compensated individuals (note:  titles are quite lengthy so they have been shortened where VC = Vice Chancellor, DVC=Deputy Vice Chancellor) listed below:

• $2,721,834:  Derek Mason, BS, Head Football Coach
• $2,261,761:  Kevin E Stallings, MS, Head Mens Basketball Coach
• $1,967,806:  Jeffrey R Balser, MD, PhD, VC for Health Affairs, Dean, School of Med
• $1,939,305:  Paul A Thomas, MD, Assoc Prof of Clinical Orthopedic Surgery
• $1,821,566:  Anders W Hall, MBA, VC for Investments, Chief Investment Officer
• $1,618,461:  Charles W Pinson, MD, MBA, DVC for Health Affairs, Sr Assoc Dean
• $1,581,099:  Nicholas S Zeppos, JD, Chancellor
• $1,556,921:  Michael J McNamara, MD, Assoc Prof of Orthopedics, Surgery, and Rehabilitation
• $1,413,017:  Todd R Worth, MD, Asst Professor of Orthopedic Surgery
• $1,193,193:  Brett C Sweet, MBA, VC for Finance and CFO
• $1,062,693:  David Williams, II, MBA, JD, LLM, VC for Athletics
• $  997,015:  John M Lutz, AB, VC for IT
• $  942,452:  John F Manning, Jr, PhD, MBA, AVC for Health Aff, Chief Admin Officer, Sr Assoc Dean
• $  858,137:  David R Posch, EVP, Population Health
• $  793,119:  Audrey Jane Anderson, JD, VC, General Counsel, and University Secretary
• $  786,685:  Susan Wente, PhD, Provost and VC for Academic Affairs and Prof of Biology
• $  729,724:  Charles L Gregory, MA, MBA, MHA,Chief Bus Dev Off, Asst VC/CEO Children’s Hosp
• $  640,106:  Richard C McCarty, MS, PhD, Former Provost, Current Professor of Psychology
• $  630,807:  Mitchell Edgeworth, MBA, CEO, Vanderbilt U Hospital and Clinics
• $  605,360:  Susie S Stalcup, BBA, CFP, Vice Chancellor for Development and Alumni Relations
• $  497,378:  Eric C Kopstain, MBA, Vice Chancellor for Administration
• $  455,008:  Beth A Fortune, MA, Vice Chancellor for Public Affairs

Of the 22 individuals listed above, 18 (82%) are men, while 4 (18% are women). The top 14 most highly compensated individuals were men who received $800,000 – $2,700,000. The two most highly compensated individuals are coaches for sports.

Vanderbilt reports on the Form 990 that the university paid for first class or charter travel and travel for companions but it is unclear how much of the $24 million was spent on these benefits.  In addition, Vanderbilt paid for health or social club dues but it is unclear what the amount is. To read supplemental information on these benefits, go to Form 990, Schedule J, Part III.

• $94,013 in education assistance was provided to four employees, dependents, or family members.
• $117,653 in tuition assistance was provided to three interested persons (typically relatives of officers or employees).
• $425,416 in employment compensation was given to Andrea Birch, family member of trustee, Adolpho Birch, III.
• $165,812 in employment compensation was given to Gary Robert Kimball, family member of trustee, Carroll E Kimball.
• $59,529 in employment compensation was given to Stacy McCarty, family member of former officer,  Richard McCarty.
• $136,642 in employment compensation was given to Gail P Carr-Williams, family member of officer, David Williams, II.

To read the IRS Form 990 (2015), click here.