Conferees refused to eliminate Golden Parachutes

NC House members of the Conference Committee ignored their obligation to advocate for the House position

August 11, 2009

WAKE COUNTY NEWS -- North Carolina House Leader Paul Stam reports Budget Conference Commmittee refused to eliminate Golden Parachutes.

The practice of the University of North Carolina to pay large salaries to administrators who resign to return to teaching positions survived the budget knife. According to the News and Observer, this policy has cost NC taxpayers more than $8 million over the past five years. The House overwhelmingly adopted a provision to eliminate these extraordinary payments throughout state government. The budget recently signed by Governor Perdue continues these "golden parachutes."

"During the recent budget debate, we heard many legislators pledge to ferret out unnecessary spending and waste. Yet a House provision to eliminate pay for state employees who are no longer doing the work failed to be supported by the Democrat leadership. This is inexcusable during a recession when Democrats are forcing $1 billion of new taxes on our citizens," said House Republican Leader, Rep. Paul Stam of Wake County.

UNC administrators who "retreat" back to faculty teaching positions retain their previous higher salaries as they prepare to assume new responsibilities. This practice gained widespread attention recently as the Mary Easley scandal at NC State University exposed the salary retention packages of former provost Larry Nielsen and former chancellor James Oblinger. The News and Observer reported that 117 UNC system administrators took advantage of these lucrative deals over the past five years.

An amendment to the budget to prohibit these so-called "transition payments" sponsored by Rep. Hugh Blackwell of Burke County passed the House 68-45. However, the House members of the conference committee⁽¹⁾ ignored their obligation to advocate for the House position on this provision.

1. Conference Committee: A committee established when the house of origin refuses to accept changes made to a bill by the second house. The Speaker of the House and the President Pro Tempore of the Senate appoint members of their respective chamber to work out the differences arising between the two bodies.