The UNC system's Board of Governors voted last week to phase out the practice of allowing campus-related foundations to supplement the salaries of chancellors.
In 1995 the board voted to allow campuses to supplement the salaries of chancellors up to an additional one-third of the state-appropriated base salary. The intent of the policy was to improve the UNC system's competitiveness in chancellor salaries.
The policy was established at the time of the recruitment of Chancellor Michael Hooker.
Last November the board stated it would seek state appropriations that would raise chancellor salaries to levels that would make the foundation supplements unnecessary.
Six chancellors' salaries now are supplemented by campus-related foundations.
On Friday the board voted to bar the remaining ten campuses from supplementing chancellor salaries with nonstate funds.
It also voted to increase incrementally the state funds being used to pay the salaries of chancellors receiving nonstate supplements during five years so that by the academic year 2001-2002 all chancellor salaries will be funded by state funds only.
Salaries of chancellors not receiving the supplements will be built up incrementally using state funds to reduce salary disparities.
Board member Earl Phillips spoke against the proposal, saying campuses should retain the flexibility to supplement chancellors' salaries.
"I aspire, and this entire Board of Governors aspires, for better things," he said. "I think it would be a mistake to make chancellors' salaries totally dependent on state funds. We need to be able to use every tool in our toolbox, it seems to me, to attract and retain our outstanding leaders."
But other board members said the measure would allow campuses without strong foundation support also to offer competitive salaries to chancellors.
UNC system President C.D. Spangler Jr. said that at the time when the supplements were first approved the state's economy was not performing as well as now. Additionally, Spangler said, some campuses were unable to take advantage of the policy.
Spangler said chancellors' salary levels were ample for recruitment.
"We have never lost a chancellor, the recruitment of a chancellor, in my period of time because of compensation," Spangler said.
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