It was revealed Wednesday, through documents given to the University of Central Arkansas Board of Trustees in March, that the $300,000 accelerated bonus recently paid to president Lu Hardin was initially requested by the school's president himself.
Though Hardin has since refunded the money to UCA because of the surrounding controversy over whether funds used were public or private and the timing of the situation, he said Wednesday he requested it after the board asked what it would take for him to stay with the university.
"The Board of Trustees approached me in February about my compensation package and then essentially asked what it would take for me not to consider any other out-of-state colleges," Hardin said. "And my response was no increase in salary because the faculty wasn't receiving an increase and not to receive a new president's home, but there were two items I requested for consideration at that time. The $300,000 accelerated payment and the consideration of a $150,000-per-year deferred-compensation."
During a May 2 executive session, the board approved the early payment of an incentive package approved in 2005 to give Hardin an additional $60,000 a year for five years; however, the meeting's minutes did not reflect this decision.
Hardin said he thought the advancement of this bonus would be a good possibility because it was not a salary raise, but something he was already scheduled to receive in 2010, pending he stayed in his position.
In the memo addressed to Randy Sims, chairman of the board, and dated March 25, 2008, Hardin outlined the compensation packages of university presidents from the University of Arkansas, the University of Mississippi and Mississippi State University.
Hardin noted that all the presidents mentioned will receive funds from a deferred-compensation plan upon retirement and he requested the consideration of $150,000 per year, in private funds, to be kept for him in addition to his $253,000 annual salary.
"While the total package will be $50,000 below the (University of Arkansas), this is still very generous and fair," Hardin wrote in the memo. "According to the U of A attorney, this does not require a public vote because it is 'deferred.'"
However, Hardin said Wednesday though the board has yet to make a decision on this deferred-compensation package, he would definitely recommended that the board take a public vote on the matter.
Hardin stressed that this particular payment package has not been passed and "is not on the table for immediate consideration."
"The board communicated to me after the meeting (in May) that they had all been very affirmative in attempting to come up with a deferred-compensation plan of additional money, but that they needed to find a source of revenue and they needed to research the legality," Hardin said.
He added, if passed, the funds would strictly come from the UCA Foundation.
In light of recent issues, Hardin said he would recommend a public vote on everything concerning the payment packages. Because the $300,000 accelerated payment was not recorded in any official minutes, he said it is his "understanding that a public vote will take place on that this Friday."
The memo given to the board of trustees outlining possible incentives for Hardin was made available after Freedom of Information requests were sent to the university regarding the recent situation, he said.
The $300,000 the board approved for Hardin in May was taken out of the Board of Trustees Endowment Fund, which is generated by excess revenue from student book store and food service sales. This fund was deemed most likely public in an opinion issued by Attorney General Dustin McDaniel Tuesday. McDaniel also said the bonus likely violated state-mandated salary caps for university employees.
"The AG's opinion is probably correct in its interpretation, but I still have some academic curiosity of the nature of the trustees fund in certain areas," Hardin said. "But ultimately I think we should always err on the side of public funds."
Because Hardin made the decision to refund the bonus before the opinion was issued, he said the point of the opinion now is to "send a definitive message that we need to be very careful with what is spent out of the trustees fund."
Hardin said had he not repaid the bonus before McDaniel's opinion, he thinks the decision would have required him to pay back the money within a reasonable amount of time, which he said he would have done.
Although the UCA president has paid the bonus back, there is still a possibility he will receive it again in the future. Hardin said it would only be awarded if the faculty and staff receive a raise and the bonus is paid only by private funds.
Telephone calls to Sims were not returned and Dr. Michael Stanton, board member, could not be reached as of press time.
The next regular meeting of the Board of Trustees is scheduled for 2 p.m. Friday in the board room of Wingo Hall on the UCA campus.
(Staff writer Jessica Bauer can be reached by e-mail at jessica.bauer@thecabin.net or by phone at 505-1236. To comment on this and other stories in the Log Cabin, log on to www.thecabin.net. Send us your news at www.thecabin.net/submit)
