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Friday, March 19, 2004



Kamehameha pay
raise rejected

Trustees decline a plan that would have
boosted their pay cap to $165,000 a year


Kamehameha Schools' trustees have turned down a controversial plan to increase their annual pay by nearly 70 percent.

In an e-mail to staffers, Kamehameha Schools Chief Executive Dee Jay Mailer said the trust's five board members have agreed to turn down a Probate Court-approved plan that would raise the trustees' pay cap to $165,000 a year from $97,500 a year.

"At this time everyone at Kamehameha is exercising budget constraint as we prudently manage the resources of the trust while maintaining the high quality of our educational reach," Mailer said.

"By taking this action, the trustees are clearly modeling the same behavior we are all demanding of ourselves."

Nainoa Thompson is chairman of the trustees. The other four trustees are Constance Lau, Diane Plotts, Robert Kihune and Doug Ing.

For the past several years, the trustees' annual compensation had been set at $97,500. That includes an annual $30,000 retainer plus a $1,500 fee for each board meeting. The number of board meetings is limited to 45 a year.

Under a plan approved by a state probate judge in January, the number of paid meetings was to double to 90 a year to reflect trustees' increased workloads.

The proposal was criticized by the state attorney general's office, which argued that the board was supposed to focus on policy-making while leaving day-to-day management to the chief executive.

Trustee pay has been a source of controversy for the $6 billion Kamehameha Schools, going back to the late 1980s and 1990s when board members paid themselves up to $1 million a year each.

The high pay of former trustees Henry Peters, Richard "Dickie" Wong, Lokelani Lindsey, Gerard Jervis and Oswald Stender prompted the IRS in 1999 to threaten to revoke the estate's tax-exempt status.

Legislative and court-mandated reforms implemented since then have capped board members' pay at "reasonable levels" set by an outside trustee compensation committee.

Roy Benham, former president of the Kamehameha Schools Alumni Association, said the trustees made a prudent decision in turning down the pay increase. He believes the trustees' workloads will lessen over time with the estate's new CEO-based management system.



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