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Published February 05 2013

Chancellor buyout could cost more than $830,000

FARGO – The hiring of Hamid Shirvani as North Dakota University System chancellor carried a hefty price tag – about $100,000 more than the previous chancellor’s pay – and buying out his contract wouldn’t be cheap, either.

If the State Board of Higher Education were to buy out Shirvani’s contract – something President Duaine Espegard said the board has no desire to do right now – it would cost $836,620, based on Shirvani’s salary and the time remaining on his contract.

Shirvani signed a three-year deal with the Board of Higher Education on March 25 of last year. The term of the contract is from July 1, 2012, to June 30, 2015.

Shirvani is paid an annual salary of $349,000, or $956 per day, plus retirement plan contributions, participation in the state health plan and “other benefits provided by law and policy,” the contract states.

With two years and 145 days left on his contract, a buyout would cost $836,620 based on salary alone. Information about Shirvani’s retirement benefits was not available Tuesday, University System spokeswoman Linda Donlin said.

The contract also contains four special conditions that likely wouldn’t affect the cost of a buyout. One condition is that Shirvani is entitled to use a state fleet vehicle or be reimbursed at the state mileage rate for using his own vehicle for official business. He also received moving expenses and reimbursement for a round trip to North Dakota before his start date.

Board policy doesn’t spell out how the panel would go about buying out a chancellor’s contract, but it does describe the process for dismissing the system’s top leader.

Policy 304.1 states that the chancellor “serves at the pleasure of the Board” and is subject to an annual performance evaluation. The board may choose to extend the contract for up to three years or decide not to extend or renew it.

“The Board may dismiss the Chancellor for just cause during a contract term, following written notice of its intent to do so and an opportunity for an evidentiary hearing,” the policy states. “The board may appoint a hearing officer or administrative law judge to conduct the hearing before the Board.”

Before the policy was revised last September, it held that the board could “terminate the contract without cause” if it gave one year of written notice prior to the contract expiring. That sentence was struck and replaced with the language about the performance evaluation and contract extension or nonrenewal.


Readers can reach Forum reporter Mike Nowatzki at (701) 241-5528