Michigan State President Kevin Guskiewicz's contract includes 7-figure compensation, plenty of other perks

EAST LANSING — New Michigan State University President Kevin Guskiewicz will be paid a base salary of $975,000 a year, but his contract includes plenty of other compensation and language that defines what he will get should he leave the school under various scenarios.

Including deferred compensation, the new president's income from the university will exceed $1.1 million annually.

Michigan State trustees appointed Guskiewicz as the university's new president on Friday, when they also OK'd a contract that topped the base salary and deferred compensation for the last regular president - not interim or acting - since the Larry Nassar scandal peaked in 2018.

President Samuel Stanley Jr. resigned last year saying that he had lost confidence in the Board of Trustees, some of whom had pressured him to retire early.

Guskiewicz, now chancellor at University of North Carolina-Chapel Hill, will start in his new leadership position March 4, and he's also expected to have a tenured professor's position with MSU's Kinesiology Department in the College of Education.

The employment agreement is similar to the one negotiated with Stanley, who was president from 2019 to 2022 and who was one of the Big Ten's highest-paid university presidents following a 2021 contract update. But there are differences. Among them: The brand of vehicle he is expected to use.

Stanley began his time with annual pay of $800,000 in 2019 with $100,000 in yearly deferred compensation, and his salary was increased to $960,000 per year in 2021.

Much of their other benefits are similar, including memberships to clubs, travel and business expenses and housing.

University officials have been searching for a new president and negotiating Guskiewicz's contract during controversies including the termination of football coach Mel Tucker, who was found responsible for violating the school's sexual harassment policy, the forced resignation of former Eli Broad School of Business Dean Sanjay Gupta, Stanley's abrupt exit and public infighting among trustees that included misconduct allegations against board chair Rema Vassar.

Tucker has indicated he plans to sue the school for wrongful termination and to recoup at least some of the roughly $80 million remaining on the 10-year, $95 million contract extension he signed in November 2021. Stanley's salary pales in comparison to Tucker's deal and new football coach Jonathan Smith’s seven-year $52.85 contract. Smith is expected to have a base pay of $6 million annually and supplemental income that starts at $1.25 million his first year.

Guskiewicz will be the fifth person to lead the university since Lou Anna Simon resigned in January 2018 hours after USA Gymnastics and MSU Dr. Larry Nassar was sentenced to an effective life sentence in prison after convictions in federal and circuit courts in Ingham and Eaton counties.

Since Simon resigned, former Michigan governor John Engler, Satish Udpa, Stanley and Teresa Woodruff have led the school. Engler served as an interim president 2018 to 2019. Udpa was acting president in 2019. Stanley was president 2019 to 2022. Woodruff has been interim president since 2022 and said this summer that she would not pursue the permanent position.

Here are the key elements of the contract.

Deferred compensation and housing

• The deferred annual compensation of salary of $150,000 is payable at the end of each contract year if he is still employed and is in addition to the base pay of $81,250 a month. The deferred payment would vest on a pro-rated basis if Guskiewicz is fired without cause, resigns for “Good Reason,” or dies or becomes permanently disabled.

• His housing will be covered by MSU, and he is required to live in the presidential residence, Cowles House, on campus. There also is an expectation that he hosts university events. Most of the housing, including insurance, will be covered by the university but Guskiewicz and his family are responsible for insuring their personal belongings as well as reimbursing any food, housekeeping or other costs related to the personal use portion of the presidential home.

• Guskiewicz will get a $75,000 one-time moving expense, in his first paycheck.

Memberships and a driver

• Guskiewicz will get memberships in the University Club and Country Club of Lansing paid by the university. He will be responsible for “personal expenses” at the clubs.

• He will get the standard employee benefits available for executives for retirement, health care, vacation, life insurance and long-term disability. Stanley's contract called for an annual $28,000 retirement contribution, Guskiewicz's contract does not specify an annual contribution amount from MSU.

• Guskiewicz will get a vehicle from the University Department of Police and Public Safety and will have a driver while doing official university business.

• The university will additionally lease him a vehicle for business and personal use, and the contract includes fuel, insurance and maintenance. Personal mileage will be considered taxable income. In a change from Stanley's contract, the vehicle is no longer required to be from General Motors Co.

• The university will cover any “reasonable business expenses” including professional licenses or fees, along with costs for hosting university events and travel for university business as well as spousal travel expenses.

• He will get complimentary tickets to all university sporting events, including a suite for football and basketball games, intended to help boost MSU’s interests.

Obligations and responsibilities

• He will officially start on March 4, 2024, with a five-year term that can be renewed, with negotiations for any renewal happening at least a year before the contract would naturally expire on March 4, 2029, according to the contract.

• He is subject to an annual performance evaluation by the board.

• He is required to take an annual physical, at the university’s cost, from a physician of his choice. The results would remain private, but a physician will need to affirm in writing each year that Guskiewicz is “fit for duty as president.”

• He is required to certify each year that he has paid his federal, state and local taxes in full.

Termination or resignation terms outlined

Guskiewicz's new contract lays out that he could be terminated for cause for several reasons including willful misconduct, gross negligence and failing to do his duties or follow legal directions of the board. A three-quarters vote from the eight-person board could lead to his termination.

"Further, in no case shall the University be liable to Guskiewicz for the loss of any collateral business opportunities, or any other benefits, income, or consequential damages suffered by Guskiewicz as a result of his termination for Cause," the contract states.

If Guskiewicz is terminated for cause, he would no longer qualify for the post-presidency tenure position he is otherwise eligible to receive.

Again with a three-quarters vote, trustees could terminate Guskiewicz’s employment without cause.

If such termination is pursued during the five-year term of the contract, "Guskiewicz shall be entitled to assume the responsibilities commensurate with his position as tenured professor and shall be entitled to compensation equal to fifty percent (50%) of his annual base salary during his final contract year as President. Guskiewicz will also be entitled to a year sabbatical year in accordance with Section L."

Contact Mike Ellis at mellis@lsj.com or 517-267-0415

This article originally appeared on Lansing State Journal: What's in new MSU President Kevin Guskiewicz's contract? Plenty of perks