Board Policies and Procedures

Executive Level Compensation Procedure

1. Purpose

Recruiting a highly qualified, talented, and diverse executive team is a critical piece of ensuring KCTCS’ success. The KCTCS Board of Regents establishes the policies and procedures under which KCTCS rewards executive talent. This procedure governs the review and approval of executive compensation as further defined below and is consistent with applicable federal tax law and Kentucky law.

2. Scope

This procedure applies to executive level employees: 

• College Presidents
• Chancellor
• System Vice Presidents
• General COunsel
• Chief of Staff

The KCTCS President’s compensation is exempt from this procedure as it is established by the Board at the time of hire based on market research and any increases thereafter are set by the Board based on performance evaluation and current market standards.

3. Procedure

The following total compensation elements will be reviewed and determined annually by the KCTCS Board of Regents.

3.1 Elements of Total Executive Compensation

1. Base Salary: Salary is the primary component of executive total compensation. It provides a competitive foundation for pay and reflects the role, education, unique skills and abilities, experience, and performance against established metrics. Salary increases are not an entitlement but are awarded in accordance with KCTCS Board of Regents’ policies and procedures.
   
   
2. Health Benefits: : KCTCS provides 100% employer-paid family health insurance and dental insurance.
   
   
3. Supplemental Long Term Disability Insurance Policy: KCTCS provides additional employer paid coverage.
   
   
4. 401(a) Qualified Pension Plan: KCTCS contributes 4% of the base annual salary in accordance with Board Policy 3.7 Retirement Plan Policies.
   
   
5. Executive Supplementary Allowance (ESA): Allowance paid out as it is earned over the year along with base salary to allow for compensation related to the size of the college, which is calculated based on student enrollment and number of employees, size of service area, performance indicators, and other relevant factors.  Cabinet Members’ ESA shall be determined based on System-wide responsibilities, System Office duties, job responsibilities, and other relevant factors.
   
   
6. College Size: Whether a college falls into the category of small, medium, or large depends upon student enrollment, both full and part-time; number of employees, including full-time faculty, adjunct faculty, and both full-time and part-time staff; service area; programs offered; performance indicators; workforce partners; and other relevant factors that may be used in averaging the size of the college.
   
   
7. Automobile Allowance: Allowance paid out as it is earned over the year along with base salary to compensate for the use of personal vehicles for job-related travel.
   
   
8. Full Annual Medical Evaluation: KCTCS will reimburse the cost of an annual exam at 100% unless an annual medical examination is covered under the health care plan chosen by the executive.
   
   
9. Paid Vacation Leave: 22 days per year are awarded annually on July 1. If the contract begins after July 1, this amount is prorated.
   
   
10. Paid Sick Leave: One day per month.
    
    
11. Additional Compensation: Additional benefits may be negotiated for newly hired executives who are leaving prior employment outside the KCTCS system to accept a KCTCS position. These may include benefits such as reimbursement for moving and house hunting expenses, COBRA coverage until KCTCS insurance coverage is available, some travel expenses, and temporary housing.
    
    
12. Other Benefits Afforded to All KCTCS Employees: Executive level employees are eligible for other regular KCTCS employee benefits such as travel reimbursement, Worker’s Compensation Insurance, Life Insurance, Retirement Plans and any and all other planned benefits for which the executive is eligible in accordance with KCTCS policy and procedure.

3.2 Method for Determining Executive Compensation

For executive positions, KCTCS competes and recruits for talent nationally. For some administrative roles, KCTCS may consider talent from outside the higher education demographic if the candidate possesses relevant experience and the required credentials for the role. KCTCS primarily considers comparative data for similarly qualified persons in comparable positions at similarly situated institutions.

Criteria used to determine comparison market includes: 

1. Classification as an associate degree-granting institution or system of institutions located in the United States of America.
2. Private and public institutions within Kentucky and in contiguous states where KCTCS competes for talent.
3. Equity across similar positions and/or college size.

KCTCS participates in an annual survey of compensation among the higher education community conducted by the College and University Professional Association (CUPA). This study reflects the above criteria, and the survey data are used as the primary comparison market. The KCTCS Human Resources Compensation team is responsible for submitting data on behalf of KCTCS for this purpose and will periodically evaluate the comparison market(s), which may change from time to time.

3.3 Executive Compensation Pay Bands

3.4 Supplemental Compensation Pay Bands

Automobile allowances range from a minimum of $10,000 to a maximum of $20,000 annually.

3.5  Board of Regents Review Process

1. Executives whose compensation falls within established pay bands and ranges of supplemental compensation will be reported to the Board for ratification as part of the regular personnel action report at the next regular meeting after hire.
   
   
2. The KCTCS President must receive prior approval from a simple majority of the three Executive Officers  of the Board before offering compensation outside the established ranges. Justification for exceeding established ranges shall include one or more of the following: education, work experience, or a hardship in filling the position under normal circumstances.