University of Louisville Foundation paid Ramsey $1.8 million in 2013, latest disclosure shows
University of Louisville President James Ramsey was paid $1.86 million by the U of L Foundation in 2013, according to the organization's latest annual public disclosure form, which was filed with IRS last month. The foundation paid Ramsey's top two aides, former Provost Shirley Willihnganz and Chief of Staff Kathleen Smith, $663,038 and $319,146 respectively in 2013, according to the tax form.
Wednesday, June 24th 2015, 9:09 am EDT by
Wednesday, June 24th 2015, 9:13 am EDT
LOUISVILLE, Ky. (WDRB) -- University of Louisville President James Ramsey was paid $1.86 million by the U of L Foundation in 2013, according to
, which was filed with IRS last month.
The foundation paid Ramsey's top two aides, former Provost Shirley Willihnganz and Chief of Staff Kathleen Smith, $663,038 and $319,146 respectively in 2013, according to the tax form.
The 2013 payments are down significantly from 2012, when the foundation, a separate nonprofit led by Ramsey, reported paying each of the executives more than $1 million in addition to their regular salaries from U of L.
The 2012 payments -- $3.2 million to Ramsey, $1.9 million to Willihnganz and $1.4 million to Smith – caught the attention of media,
to examine the foundation and
Earlier this year,
to compare top officials' pay to counterparts at peer universities, and the report should be discussed at the trustees' July retreat.
Besides Ramsey, Willihnganz and Smith, the foundation also reported paying Nucleus CEO Vickie Yates Brown ($383,921); athletics director Tom Jurich ($255,915); assistant athletics director Kevin Miller ($144,993); former vice president of finance Michael Curtin, who resigned Aug. 31, 2013 ($172,947); and foundation chief financial officer Jason Tomlinson ($139,118), according to the latest disclosure.
The main reason U of L officials earned so much in 2012 was because of the vesting of “deferred compensation” – money earned over several years as an incentive to remain in their jobs.
The payments also included interest earnings, as the deferred pay is invested by the foundation for the executives, and “tax gross up” payments by the foundation so the executives owe no income taxes on the incentive pay.
In 2013, Ramsey's $1.86 million from the foundation included $944,512 in deferred pay. Willihnganz got $328,461 in deferred pay and Smith $185,610, according to the latest disclosure.
The biggest single portion of those deferred payments was the “gross up” amount so that the executives owed no income taxes -- $312,671 for Ramsey, $154,639 for Willihnganz and $86,738 for Smith, according to additional information shared by the university.
The breakdown also shows that each of the three got an additional payment in 2013 because the foundation underestimated the “gross up” in 2012, resulting in the executives' having to pay taxes out of pocket. The foundation reimbursed $91,041 to Ramsey, $58,153 to Willihnganz and $43,202 to Smith.
Ramsey's deferred pay in 2013 also included $300,000 representing two years' worth of his annual bonus. Tomlinson, the foundation's chief financial officer, said it was unclear whether Ramsey would accept his 2012 bonus, so the payment was delayed until 2013.
Also, the foundation paid Ramsey $71,345 to cover his future taxes on an annuity the foundation bought for him, which pays $100,000 a year for 10 years. The annuity, part of a 2005 change to Ramsey's employment contract with the foundation, was an incentive to remain on the job until 2012.
In addition, the form shows, Ramsey accrued another $520,833 in deferred pay in 2013 – and Willihnganz another $187,500.
But those are merely calculations required by the IRS and do not represent actual money paid or even a good estimate of future payments, said Bob Montgomery, the foundation's outside accountant for deferred compensation.
The amounts are related to deferred pay the executives could earn in the future. For example, Ramsey gets $250,000 for every year he remains U of L president through 2020, according to his 2012 contract extension.
Ramsey's $3.2 million total pay in 2012 was also inflated by the $520,833 figure required by the IRS.
Additional payments from University Holdings
WDRB first reported that Smith and Willihnganz had at times been paid by an additional nonprofit called University Holdings Inc.
, a subsidiary of the foundation.
In 2013, University Holdings paid Smith $46,800. The foundation's tax form shows Smith received the $46,800 from an unnamed “related organization.”
That organization is University Holdings, Tomlinson said.
Unlike in the three prior years, University Holdings did not disclose Smith's compensation on
. Smith's pay did not have to be listed because she was not an officer, director or trustee of University Holdings, Tomlinson said.
The compensation from University Holdings was in addition to Smith's regular compensation from the foundation, $67,739.
In an email, Smith said she works about 15 hours a week for University Holdings, which is the “managing entity” for most of the subsidiary companies created by the foundation for its real projects such as the Cardinal Station building at Central Avenue and S. Third Street, the Belknap Engineering and Research Park, the ShelbyHurst Office and Research Park and the Nucleus area downtown.
Describing her job with University Holdings, Smith said she works “in a management/liaison role with or on the behalf of” the foundation sub-companies.
The only person University Holdings disclosed paying in 2013 was Tomlinson, who received $38,446 for working an average 3.5 hours a week, according to the tax form.
Tomlinson said he took on some additional duties with University Holdings in 2013 as assigned by Curtin, such as working on real estate leases.
The additional information shared by the university also shows that Smith received a $4,800 “car allowance” from the foundation in 2013.
Tim Mulloy, a public relations executive on contract with the foundation, said Smith's total car allowance is $12,000 per year, and a portion of it is paid by the foundation. The car allowance is in lieu of billing for mileage reimbursement, he said.
SUNDAY EDITION | Part 1: University of Louisville executives benefited from quick vesting, retroactive investment returns for "deferred" pay
SUNDAY EDITION | Part 2: University of Louisville Foundation gave $120,000 no-bid consulting contract to ex-board member
University of Louisville President James Ramsey defends foundation compensation in testy meeting with trustees