Paid To Quit: Smith's $1.1 Million Dollar Deal - KCBD NewsChannel 11 Lubbock

2/23/06

Paid To Quit: Smith's $1.1 Million Dollar Deal

It took NewsChannel 11 weeks to sort through documents we got from Texas Tech University. "It's a slap in the face to the citizens of Lubbock. They think we must be stupid to let something like this just go by and we say it is OK," said Ronnie Fowler, a citizen who contacted NewsChannel 11 with concerns.

Taxpayers like Ronnie are mad that top officials are getting "big bucks" to leave their jobs. Last month Texas Tech Board of Regents agreed to pay former Tech Chancellor Dr. David Smith nearly $1.1 million after he announced his "resignation." He was paid $716,000 as salary, and $371,000 from a deferred compensation account. "It seems like every semester tuition is going up. These kids need help. They don't need tuition to keep going up. Then they see their chancellor who gets this kind of money to quit? I wouldn't feel good about it, " said Ronnie.

Ronnie is a retired firefighter thinks Smith's governmental payout should have never happened. NewsChannel; 11 did some digging. Smith's original contract says if the Board of Regents terminates Smith "without cause," he gets his salary for the years remaining on the contract and the money from the deferred compensation account. Which at this point, the total is well over $1 million.

But if he leaves by a "mutual agreement" between him and the Regents, he gets only the money from the deferred account which at this point is only about $371,000. So how did Smith walk away with both amounts when, technically, he was not fired.

The answer may be in this new document called "separation agreement and in the "termination" portion of his original contract. The original contract says if he leaves by "mutual agreement," he gets only the deferred compensation or whatever is "agreed to by the parties." It appears Smith's "separation agreement" did just that; it changed the original contract.

Now, Smith gets paid most of what he would have made in salary for the next two years as well as the deferred compensation, for a grand total of: $1,088,094. It also says he is allowed to stay in the Chancellor's House until July and Tech will pay his moving expenses.

"They get enormous amounts of money for what I feel is for no reason," said Ronnie.

Others who have contacted us wanted to know, why did the board agree to give Smith more money than they were obligated?

We were told all questions must be addressed to chairman Rick Francis. He never returned our phone calls.

So we asked an attorney for Texas Tech. He told us the Regents can reach whatever agreement they find acceptable.

When Smith signed this contract that promised him $1.1 million, he and the Board of Regents agreed that "they will not disparage one another in print, verbally, or otherwise."

2/28/06
Paid To Quit: City of Lubbock Spends $555,000
Four top city leaders have made $1.5 million to leave their jobs in recent years. Chancellor Dr. David Smith's resignation is effective Tuesday. In part one of our investigation we told you that because of agreements between Dr. Smith and Regents, Texas Tech is paying him what he would have made in salary over the next two years. That totals nearly $1.1 million. We find out why the city of Lubbock shelled out nearly half a million dollars to three city managers.
NewsChannel 11 Special Reports
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