Chancellor to receive, and lose bonuses upon departure

Published: Thursday, March 14, 1996

By Michael Howerton

Daily Bruin Staff

SAN FRANCISCO -- UCLA Chancellor Charles Young will receive a $150,000 bonus when he steps down next year. But due to a violation of another contract with the university, he stands to lose other bonuses worth an additional $100,000.

On top of his pension and severance pay, Young has been promised bonuses that could total around $250,000 when he leaves UCLA after 27 years as the school's top administrator. Yet by leaving two years before one of his contracts is up, he has put some of his retirement bonuses in jeopardy.

His bonus had been agreed upon as part of a 1986 incentive package to entice him to stay on as chancellor at the university - a position he has held since 1969.

Young's decision to retire next year raised new concerns that the practice of departing bonuses for top officials is an unnecessary drain on university resources.

The most infamous example of this is the $1 million given to departing UC President David Gardner in 1992. Gardner's benefit package was approved by the Board of Regents prior to his retirement, at the same time they approved Young's package.

However, just after Gardner left in 1992, the regents reformed the retirement policies to lower the amount of benefits officials would receive upon retirement.

Commonly referred to as a "golden parachute," Young called the package "golden handcuffs." He explained the bonus was promised to him in 1986 as an enticement for him to stay at his position at UCLA rather than retiring or seeking a position elsewhere.

"I had lots of other offers at the time," Young said of the agreement. "The (UC) president offered to have me stay. The golden handcuffs were the incentive."

The contract Young signed with the university offering these bonuses, which were approximated in 1992 to be close to $150,000.

In 1991, a new contract was signed because changes in the national tax laws put Young in a position where he would stand to lose benefits if he remained with the university.

Since the Internal Revenue Code 415, passed in 1987, placed a cap on the amount of benefits that could be earned, the new contract gave Young back the benefits he would have otherwise lost, explained Terry Colvin, a university spokesman.

However, the terms of the new contract, which Colvin approximated grant around $100,000 additionally to Young, were voided when he announced last month that he would be retiring in 1998.

The contract, which carries an agreed upon retirement date of July 1, 1999, reads that the benefits will be "immediately forfeited upon termination of Employee's services before the agreed upon retirement date."

Young could challenge this clause and ask the regents to grant him the package despite his early exit, but he said he has not decided yet what he will do.

"I had lots of other offers ... The golden handcuffs were the incentive."

Charles Young

UCLA Chancellor

CHARLES KUO

Chancellor Charles Young

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