New England Law, Boston has operated in the shadows of the region’s more prestigious law schools for decades, trailing so far behind in some measures of excellence that US News & World Report does not include the downtown campus in its widely read ranking of 145 better law schools in the nation.
Yet the school’s longtime dean, John F. O’Brien, may be the highest paid law school dean in America, pocketing more than $867,000 a year in salary and benefits, including a “forgivable loan’’ that he used to buy a Florida condominium.
“It’s a remarkable sum to pay a dean of a law school, never mind the dean of a bottom-ranked law school,’’ said Brian Z. Tamanaha, a law professor and the author of “Failing Law Schools,’’ a 2012 book critical of the nation’s legal education system.
O’Brien is paid about as much as the president of Harvard University and more than three times the median salary of law school deans nationally, says a study by the College and University Professional Association for Human Resources. Indeed, New England Law could not name a single law school dean in the country who makes more than O’Brien.
But O’Brien’s story is more than the tale of a richly compensated school administrator. It is also the story of a professor who vaulted, just a few years into his academic career, to the
top job at a lower-tier
law school in large part through shrewd networking, sheer persistence, and a close relationship with the school’s board of trustees, many of whom have served on the board for most or all of O’Brien’s 25-year tenure as dean.
It is also the story of a law school that has hiked tuition by more than 80 percent in just a few years while doubling the percentage of applicants it accepts, generating the funds for increased student aid but also for the big salaries paid to O’Brien and other top administrators even as the demand for law school graduates dries up.
For years, O’Brien has burnished the school’s reputation and his own through high- profile events staged in luxurious settings where he and other school officials have rubbed elbows with the likes of Chief Justice John G. Roberts Jr. of the US Supreme Court and retired Supreme Court Justice Sandra Day O’Connor.
But, away from the glitz, O’Brien’s salary is drawing private criticism from some within the school and public barbs from outside observers who question whether the school is really worth the $40,000 tuition it charges students.
“There’s no relationship between cost and benefit,’’ said Paul F. Campos, a University of Colorado Law School professor and the author of the blog “Inside the Law School Scam.’’
But the 62-year-old O’Brien defends his salary, saying he has “the longest continuous service at a single institution of any law school dean in the country,’’ and is responsible for all aspects of administering New England Law, unlike other law school deans who are part of a larger university and can rely on university staff.
“I’m not going to sit here and tell you it’s not a lot of money,’’ he said in an interview in his Bay Village office. “I think most people would tell you I come to work and I work very hard, day in and day out.’’
One such person is Martin C. Foster, a fellow New England Law graduate and the chairman of school’s board of trustees. He insists that O’Brien’s salary is easily justified, pointing out that the percentage of graduates who pass the bar exam and the number of full-time faculty have risen significantly, while O’Brien’s work on national legal issues has raised the school’s profile.
In 2011, after word of his dean’s compensation triggered controversy on the Internet, Foster responded with a post on the website LinkedIn, saying, “Our board has not a shred of doubt that Dean O’Brien is the catalyst, that once-in-a-lifetime ‘game-changer’ who makes our program exponentially better than anyone else could make it.’’
New England Law certainly pays top dollar for O’Brien’s services. Pressed to name a dean who is paid more, Robert Gray, a political consultant hired by the school to help O’Brien answer questions from the Globe, cited only Brooklyn Law School, in New York City, where a dean and a president are paid combined salaries of more than $1 million.
But some indicators suggest that O’Brien’s impact on New England Law’s performance has been limited. US News & World Report, in its listing of 199 law schools, includes New England Law among the bottom 50 or so schools that it does not publicly rank because they fall “below the US News cutoff.’’
In addition, only 34 percent of students in New England Law’s 2011 graduating class were able to land jobs requiring a law degree within nine months of graduating, according to the American Bar Association, compared with 68 percent at Boston College Law School, and 90 percent at Harvard Law.
Yet, students at New England Law pay almost as much in tuition as students attending law schools where graduates generally have more success finding meaningful employment. Boston College law students, for instance, pay only about $1,000 a year more than New England Law students.
But New England Law’s escalating tuition has been a boon to its bottom line. The school — a tax-exempt, charitable organization, like most other colleges and universities in the region — reported that revenues exceeded expenses by $10 million in the 2011 fiscal year, which would represent a profit of roughly 30 percent if it were a for-profit company.
O’Brien said the school’s robust finances have allowed New England Law to triple financial aid, noting that 60 percent of students receive some form of scholarship from the school.
The school’s budget surplus translates into roughly $9,000 for every student at New England Law, suggesting that officials could significantly reduce tuition and still not lose money for the year.
Named dean in 1988
O’Brien was already a handsomely paid law school dean by 2007, drawing a salary similar to Harvard Law School dean Elena Kagan, who is now on the US Supreme Court. But in March of that year, New England Law’s longtime board chairman passed away, clearing the way for Foster to take over as board chairman and for O’Brien’s pay to skyrocket.
By that time, O’Brien had spent more than 20 years at New England Law. A native of Staten Island, he had graduated from Manhattan College, a Catholic school in the Bronx, before graduating first in the class of 1977 at what was then New England School of Law.
For the next seven years, O’Brien labored as an attorney for the IRS before returning to New England Law as a professor of constitutional law and personal income taxation and, later, associate dean. In 1988, when he was still only in his late 30s, he was handed the reins of a school known for offering students of lesser means or less than sterling credentials a chance for legal training. The school was founded, in 1908, as Portia Law School, a trail-blazing law school for women. It became fully coeducational in 1938.
When Foster was named chairman of the board, in 2007, he had already served as a board member for more than 20 years, throughout O’Brien’s entire tenure as dean. And by then, O’Brien had developed a new need for funds: He and his wife of 30 years were beginning divorce proceedings. Under their separation agreement, O’Brien’s wife got ownership of the couple’s Mendon home, while he resumed single life in a Watertown condominium and agreed to make alimony payments of $1,800 a week.
Then, in 2008, the board boosted O’Brien’s salary from $437,900 to nearly $615,000, a 40 percent increase in one year. Sweetening the deal further, the board included a $650,000 “forgivable loan,’’ under which O’Brien’s salary would include money to help repay the debt. If he stayed at the school for another 10 years, the board would forgive the entire loan.
O’Brien confirmed in an interview that the loan was crucial to his finances, giving him the cash to pay obligations to his former wife and to pay for his primary residence. He also confirmed that he used part of the loan to cover the $475,000 price of his Delray Beach condo, an 1,870-square-foot unit in a beach front development in Florida.
Board members say they had to increase O’Brien’s compensation in 2008 because, even though O’Brien had been dean for two decades by then, other schools were trying to recruit him away, in part because of the national reputation he was building through his volunteer work with the American Bar Association.
Loans to individuals by colleges and university at favorable terms are not unheard of, but they are usually made to lure prominent or promising professors to expensive housing markets or to keep them from moving to another school.
In O’Brien’s case, the board said in a series of written statements to the Globe, the loan was an incentive to keep O’Brien at the school. “This incentive is a retention tool, plain and simple,’’ the board said.
But some outside analysts question whether nonprofit organizations should be making highly discounted loans to insiders, in part because they may have difficulty collecting on the loans if the recipients fail to honor their commitments.
“Making loans of any kind requires a level of expertise that we don’t think nonprofits necessarily have,’’ said Diana Aviv, president of Independent Sector, a network of nonprofit organizations that discourages the use of forgivable loans by charitable organizations.
Aviv also said that, in cases in which such loans may be necessary, “total transparency is absolutely vital’’ to ensure there is public confidence in the organization.
But New England Law’s board would not disclose the names of the schools that were trying to recruit O’Brien. And it refused to permit the Globe to review a record of the deliberations of a compensation committee that met to set O’Brien’s pay.
“The board has a policy of not providing documents or specific information related to internal deliberations,’’ the board said.
The forgivable loan to O’Brien is not the only controversial compensation practice at New England Law.
Until recently, Foster and two other board members paid themselves generous annual stipends, another practice that is generally frowned upon in the nonprofit world.
Foster, a Cambridge attorney with an active practice, received $74,500 a year for 15 hours of work per week. Board treasurer Darrell L. Outlaw, a retired district court judge, pocketed $42,000. And school corporation president John R. Simpson, a retired director of the US Secret Service who has since stepped down from the president’s post, took home $55,000.
New England Law finally discontinued pay to board members after filing its tax return in 2011, the board said. It was about the time Attorney General Martha Coakley proposed legislation to make board stipends at nonprofit organizations illegal.
“The practice of compensating independent directors for service on a charitable board is extraordinarily rare in Massachusetts, and for good reason,’’ she said.
“The vast majority of directors view voluntary service as a primary means of giving back to the greater community the value of their skills and experience.’’
O’Brien’s networking skills are legendary and he has long used them to bolster New England Law’s reputation. Over the years, he has organized or taken part in a variety of school events featuring prominent jurists, using school funds to underwrite the jurists’ compensation, travel, and lodging expenses. The events are designed to boost the school’s cachet, but also the dean’s.
Last summer, for example, Chief Justice Roberts taught a law school class on the island of Malta in the Mediterranean Sea that was sponsored by New England Law and three other law schools, resulting in a photograph of Roberts and O’Brien gracing the cover of New England Law’s most recent alumni magazine.
In November, retired Supreme Court Justice O’Connor was the featured guest at a celebration of O’Brien’s work with the American Bar Association, where he recently chaired the organization’s Section of Legal Education and Admissions to the Bar, which was staged at the Four Seasons Hotel in Boston.
“He is just fabulous,’’ O’Connor gushed to an audience including local judicial luminaries such as Roderick L. Ireland, chief of the state Supreme Judicial Court, and Mark L. Wolf, the retiring US District Court chief judge.
“People of high standing believe he does a wonderful job, and I’ve seen nothing that would contradict that,’’ said Wayne A. Budd, the former US attorney for Massachusetts and a New England Law board member.
“I think that reflects well on the school and adds value for the students.’’
In addition, New England Law has been named one of the “top places to work in Massachusetts’’ by The Boston Globe three years in a row, based on surveys of employees.
National call for change
O’Brien’s ballooning compensation, like the fast-rising tuition at New England Law, comes as law schools across the country are grappling with significant economic and ethical challenges.
Many inside and outside academia are calling for structural changes to the way law schools operate, pointing out that student debt is rising as the demand for new law school graduates is diminishing.
James G. Leipold, executive director of the National Association for Law Placement, called the current job climate “arguably the worst entry-level legal employment market in more than 30 years.’’
According to the American Bar Association, only 55 percent of all law school graduates in the class of 2011 were able to find jobs that require a law degree within nine months of graduating.
At New England Law, just 34 percent of 2011 graduates were able to find such work, one of the lowest percentages of any accredited US law school.
O’Brien prefers to emphasize the percentage of New England Law graduates who pass the Massachusetts Bar exam, the final test law school graduates must take before they can practice law.
“People can argue about the quality of a law school, but there is one objective factor that is hard to refute, and that is how well your students do when they take the bar,’’ he said.
Still, the difficult job market has driven down law school applications nationally — including a 9.6 percent drop at New England Law since 2006 — forcing schools to come up with new strategies to stay in the black.
New England Law has prospered through a combination of raising tuition and lowering standards for admission, a strategy followed by a number of other law schools around the country.
Since 2006, New England Law has raised tuition from $22,475 to $40,984, an 82 percent increase. It has also steadily increased the percentage of applicants who are accepted, from 37.9 percent in 2004 to 70.6 percent in 2011. As a result, even though the number of applicants has fallen, the number of students at the school rose from 1,101 to 1,141.
But incoming New England Law students today are arguably less academically qualified than their predecessors. The median grade point average of the school’s entering class fell from 3.27 in 2007 to 3.15 in fall 2011. Median LSAT scores climbed from 151 to 153 from 2008 to 2010, but dropped to 149 last fall, according to New England Law.
Critics of the nation’s legal education system question the ethics of lowering academic standards to maintain class size.
“Schools that lower credentials and increase class size at a time of significant decline in the number of applicants are going for the money,’’ said Tamanaha, the Washington University law school professor and author of “Failing Laws Schools.’’
O’Brien, for his part, said that while New England Law has aggressively sought to maintain class size in recent years, it may change course and admit fewer students, a step some other law schools have already taken.
“There’s absolutely no question we were looking to hit our [enrollment] number,’’ he said. “But we very much have on the table the fact that we may become smaller.’’