Senator says PHEAA will end bonuses to executives
HARRISBURG — Officials overseeing Pennsylvania's student-loan agency are considering a restructuring of executive salaries and ending bonuses that have reignited criticism of the agency's spending practices.
Sen. Sean Logan, vice chairman of the Pennsylvania Higher Education Assistance Agency's board, said the idea was under consideration before an executive committee of the board voted last week to award more than a half-million dollars to five top PHEAA executives. The bonuses have typically amounted to six figures.
"The amount of the bonuses, even though they weren't taxpayer dollars, was offensive to people, especially hardworking families who are working to pay tuition," Logan said.
President and CEO Richard Willey received the largest bonus, $180,857, on top of his annual salary of $289,118. Three executive vice presidents each received a $113,514 bonus. A fourth received $52,436.
Logan, D-Allegheny, told the newspaper he voted for the bonuses because they had been established before he was elected to the board's leadership in February — even though he thought they were too high.
Any salary changes would have to be adopted by the executive committee, PHEAA spokesman Keith New said.
Sen. Robert Tomlinson, R-Bucks, the committee's chairman, and Rep. Bill Adolph, R-Delaware, PHEAA's board chairman, did not immediately return telephone calls seeking comment Tuesday.
Logan, D-Allegheny, could not say whether all base salaries would necessarily increase under a new schedule, but said they would not be adjusted by merely adding the total salary and bonus that each executive received.
"We need to set a salary, and if folks don't think the salary is fair then they need to look elsewhere," he said.
A spokesman for Gov. Ed Rendell, Chuck Ardo, said Tuesday that doing away with the bonuses would not by itself change "the culture of excess" at PHEAA.
The governor has said he will support efforts by Sen. Jane Orie, R-40th, and Sen. John Rafferty, R-Montgomery, to change the way PHEAA operates. Orie and Rafferty introduced legislation earlier this year to limit the number of terms lawmakers can serve on PHEAA's board and to require the agency to submit financial reports to the Legislature.
PHEAA, a nonprofit corporation created and largely controlled by the Legislature, finances its operating expenses from its own income.
