Not So Even At Stevens Institute of Technology

Jersey Style has an interesting post on the Stevens Institute of Technology located in Hoboken, NJ. It seems as through the private college’s bond ratings and endowment have had an inverse relationship to the salary of Hal Raveché, the President of the Institute.

Patrick links to an article in The Chronicle of Higher Education that explains Raveché’s total compensation in 2002 was $696,965 -- making him one of the 10 highest-paid college presidents in the country.

Raveché also has received three low-interest loans from the university with an outstanding balance of more than $1.2-million. All three loans are classified as mortgages, with an interest rate of about 2 percent.

Mr. Raveché, who lives in a handsome brick colonial owned by Stevens, explains in an interview with The Chronicle that he owns two other houses. One is near the Jersey shore and the other is in Vermont's Mount Snow Valley. "The three mortgages were to acquire those homes and to do renovations on those homes, so that's what it's about," he says.

"I do work for the university in both homes," he says. "I've had many fund-raising events at these homes. Many."

The institute's annual report showed a deficit in 1999, but since then the reports have displayed only surpluses. For the 2003 fiscal year, the most recent for which data are available, the report shows an operating surplus of $464,123. But for the same period, the Institute's audited financial statement shows an operating deficit of $8,503,914.

The drop in Stevens’ bond ratings, the conflicting financial reports and four different CFO’s employed by Stevens since 2000 have raised questions about the propriety and credibility of the Institute's financial management. Raveché’s compensation and loan arrangements have compounded the speculation.

Stevens’ professors are calling for a comprehensive external review of the university's finances and management practices. The faculty is expected to vote on such a motion by secret mail ballot this week.

Very interesting you think, but why should we care? Well, according to the Chronicle’s article, U.S. Congressional appropriations for Stevens, including those it has shared with other institutions, totaled about $50-million from 2000 to 2003.

In addition, the State of New Jersey also contributes to Stevens. For example, the school’s new Lawrence T. Babbio, Jr. Center, named for Verizon executive and Stevens Institute Board of Trustees Chariman was built in part with contributions from the State. Lawrence T. Babbio is also Chairman of the Institute’s Compensation committee, the one that gave Raveché a 42% raise in 2002.

Have we peaked your interset now?