Silver as an investment

The Heads Of New York’s Elite K-12 Schools Are Making More Than Most College Presidents

For Americans that live outside of New York and San Francisco (you know, the ignorant, racist, republican-voting masses living in ‘flyover states’ that elected Trump to the White House) the notion of dropping $50,000 on Kindergarten tuition for a 5 year old would be considered dumb…like, bigly.

But, for New Yorkers it’s actually more common than you might think…at least for the 5 year olds who can pass the rigorous entrance exams.  Consider, for example, the premier private school of New York’s Upper East Side, The Dalton School, which charges $46,050 a year for Kindergarteners to nap, play with blocks and read an occasional book…

Dalton

Meanwhile, Dalton is a ‘bargain’ relative to another private school just a hop, skip and a jump across Central Park, the Trinity School, which charges Kindergartners closer $50,000 a year (or roughly the median annual income of an entire household across most of America) for what we suspect is a nearly identical regimen of sleeping and block playing.

Trinity

Of course, with tuitions that high one might expect these schools to have a student-teacher ratio of 3:1 and/or some sort of advanced technology that allows them to churn out Kindergartners that are already solving advanced Calculus problems.

Alas, as the Wall Street Journal notes today, the truth is that, much like public school across the country, a substantial portion of the exorbitant tuitions paid by New York’s “millionaire, billlionaire, private jet owners” to elite private schools goes toward funding the salaries of massively overpaid administrators. 

Per the WSJ, at least nine private school heads received compensation totaling over $800,000 in 2015 and Trinity’s John Allman cleared a staggering $1.1 million (or roughly the tuition of 22 of his students). 

The median base salary for heads of the city’s private schools is $493,478 this academic year among 44 city schools in a survey by the association. That compares to $275,000 nationwide. The group says the city’s pay for heads grew faster as well: Its median salary jumped 70% in a decade, compared with 45% nationwide.

At least nine heads of private K-12 schools in New York City earned total yearly packages topping $800,000, according to 2015 federal tax forms, the most recent year available.

Trinity School head John Allman received total compensation of $1.1 million, including base pay of $780,528, housing, bonus, benefits and deferred compensation, according to 2015 tax forms filed by the Manhattan school. Mr. Allman declined to comment. He made headlines in September for his letter to parents calling for a deeper school culture of public service rather than entitlement, to avoid being “just a very, very, very expensive finishing school” for its roughly 1,000 students.

But it’s not just administrators in ‘The City’ that are cleaning up…the head of Riverdale Country School in the Bronx, Dominic Randolph, made $974,644 in 2015, including housing and base pay of $752,776 and Horace Mann’s Thomas Kelly made $880,242, including housing and base pay of $835,497.

By comparison, the average compensation of private-college leaders, who in theory should be teaching their students far more complex tasks than how to play with blocks, was $570,000 in 2015, including bonuses and benefits.

Of course, these ridiculous salaries were all vetted by compensation consultants so they’re probably well deserved…

Nonprofit schools, under longstanding federal guidelines, must document that pay for their officers is “reasonable” compared with programs of similar size, mission and location. That means consumers can be confident that heads aren’t overpaid relative to the market, said George Davison, head of Grace Church School in Manhattan. His total compensation was $598,410, including base pay of $519,606, according to 2015 tax forms.

Parents can “say I’m not worth half that, and that’s their opinion, but they know I’m benchmarked” against peers, Mr. Davison said. “Probably heads of schools, in terms of the value they bring in, are net income generators because of our extremely important role in fundraising.”

…then again, as James Finkelstein, professor emeritus in the Schar School of Policy and Government at George Mason University, points out “that’s a large amount of money to pay an individual who is running a relatively modest enterprise.”