Oberlin College Executive Pay

FY 2018 (ending 6/30/2018)

JD has researched the latest Oberlin College executive compensation, as reported on its IRS form 990 (The income tax return for non-profit organizations). The first tax form available is for FY 2018, which ended on June 30th, 2018.

Pages 1 and 67-68 from Oberlin College’s form 990 are excerpted here. The first page summarizes the asset and income items for the year. Lines 7a and 7b report a $3.9M business loss — about $1400 per student. Is there dirty laundry hiding in this loss? Pages 67 and 68 contain the salary information for the 15 highest paid people in the college. The numbers are enough to make one puke.

Take a look at the prescient predictions of financial turmoil that have come to pass sooner than JD expected caused by extrapolating the status quo.

The tax accountants and tax attorneys who prepared this tax return have done a reasonable amount of obfuscation on the salary numbers. Nevertheless, one can deduce what each person’s total compensation was with a little bit of work. Be aware that the total compensation includes such things as fringe benefits and pension contributions.

FY 2019 (ending 6/30/2019)

Oberlin College’s compensation for its 15 Top Dogs is excerpted here from the IRS form 990. It is Oberlin’s Caesar fiddles while Rome burns, compensation-wise.

Oberlin College Executive Pay

The president’s compensation needs some additional arithmetic to arrive at a reasonably close number for it. For part of the year, the president was Krislov, and for the rest of the year, the president was Ambar. Deferred compensation further muddles Krislov’s compensation. This compensation was paid for work performed in earlier years and cannot be included in the current year because it would distort the figures for the money earned in the current year. Krislov appears to have walked away with two year’s compensation in his last year. A departure incentive, perhaps?

The bottom line is the former Oberlin president’s compensation was well over $1.2 million during the period covered by the tax return. This compensation is about 3x that of the president of the United States. President Ambar was on the job for only a fraction of the year, so her compensation is considerably smaller. Considering that President Ambar has at least the bull-slinging skills of President Trump, she is arguably underpaid because good bull-slinging skills are always well paid.

President Ambar’s generous compensation is perhaps a reward for the anticipated savings from progressively busting the union as part of a “social justice” program. The existence of the union negatively affects some of the College’s financial ratings. Indeed, the BOT is flying at 35 (K) Above Reality.

JP Morgan’s financial integrity test

JD recalls one of the biggest robber barons, JP Morgan. He had an unusual policy for evaluating the executive compensation of prospective borrowers or investments. In those days, JP Morgan’s bank could lend any amount of money to any borrower that it wanted to. Unlike today, it also could invest in the common stock of a borrower. The bank did not have to answer to anyone. If it made a poor investment, much of it came out of Morgan’s personal pocket.

In the case of Oberlin College, there is no similar mechanism in place for ensuring that when the trustees make stupid financial decisions they will feel it individually in their own pockets. None of them want to be accountable in the same way as JP Morgan. After all, they are of a higher class than robber barons and should enjoy all the executive exemptions and privileges that inure to those holding superior positions.

Morgan had an interesting test for lending to or investing in a company that Oberlin College could almost certainly not pass. His rule was simple. He would ask the prospective borrower to submit a statement showing the job titles and compensation of everybody working for the company. He looked at how much they pay at each level increased from the income of the previous tier. 

If the compensation at any level increased more than 40% from the previous level, he would not lend to the company or invest in it. The reason was simple. He felt that when the pay was skewed too heavily toward the top, it was inherently unfair and would cause the company to fail eventually.

Oberlin College fails Morgan’s test

How does the pay structure of Oberlin College look using the test used by JP Morgan 120 years ago? JD is sure the answer to this question would be Don’t ask, don’t tell. Morgan knew that when cost-cutting was necessary, everyone from top to bottom had to share in it.

JD is a pro-business person but agrees wholeheartedly with the concepts behind JP Morgan’s test of fairness and organizational stability. JD also recognizes that there are many situations where workers have little choice but to form a union. It is hardly surprising that the BOT’s managerial stupidity over the years unionized the college and eventually generated massive labor and alumni discord.

Oberlin College tax return for 2019

This excerpt of Oberlin College’s IRS Form 990 tax return for FY 2019 shows the compensation for the 15 top dogs in the college.