Regents approved what could be the last contract for President Mark Hamilton on Wednesday, increasing his salary to $300,000 for three years and giving him a $210,000 bonus if he stays through 2009.

Hamilton, who previously earned $256,500, is heading into his "final two to three year contract period," a report says. Hamilton shrugged off suggestions he would retire soon, but a regent confirmed the president has signaled that 2009 might be a nice end point.

"Mark's talked several times about the last 1,000 days," said outgoing Regent Brian Rogers.

The Board of Regents approved the contract unanimously after several hours of extended closed-door discussions in executive session during its meeting in the Butrovich Building on Wednesday.

Hamilton signed it on the spot.

The 17 percent pay bump makes Hamilton the highest paid state employee in Alaska. Patrick Gamble, president of the Alaska Railroad Corporation, ranks second with $274,865.

Hamilton said the contract shows that the regents want him to keep doing what he's doing.

"I'm just very grateful," he said.

Unlike his previous contract, which pegged his pay at 90 percent of the median salary for university presidents, the new one sets out a flat rate for the full three years.

Had the formula in the previous contract, approved in 2004, worked as expected, Hamilton's pay would have already been in the $300,000 ballpark. But technical problems in a survey used to calculate his pay caused it to slide to around $276,000.

Regents decided in June to fix the problem and hired a consulting firm to study how much Hamilton should earn. Hamilton's pay held at his previous rate of $256,500 as regents sorted out the mess. He also received a car allowance that was rolled into his salary, bringing his total take to $265,500.

The university retained Washington, D.C.-based consulting firm Quatt Associates for $20,000 to survey universities and the state private sector to find a fair value for Hamilton's salary.

Hamilton and Regents Rogers and Mary Hughes met with the consultants during the summer to discuss their options, according to a report issued by the firm in August. Discussions in part circled around Hamilton's possible retirement.

"Any new compensation structure should be consistent with the level and structure of pay necessary to recruit the next president," the report says.

The regents also looked at a survey of presidents' salaries published in November by the Chronicle for Higher Education, Rogers said. The median salary for a president at a public university is $374,846 this year, the trade publication reports.

The new contract avoids the complex formula previously used, which went screwy after the College & University Professional Association for Human Resources reported a smaller university president salary than expected, Rogers said. The new contract is retroactive to June, effectively nullifying the previous deal.

"This time we are trying to make it from not a money standpoint, but an intelligence standpoint," Hughes said.

Hamilton called the previous contract's formula "a very, very odd thing."

"I don't think there were problems," he said. "I just think under the last one it didn't come out the way [the regents] expected."

Not only does the consultants' report address Hamilton's pay, but it also details what the president may do post-retirement.

"Several interviewees suggested considering innovative retention options, such as a professorship following completion of the presidential term, with a sabbatical intervening," the report says. "The sabbatical would be expected to produce a book or other substantial work product."

Rogers said the deferred compensation package in the new contract, set at $70,000 per year that Hamilton stays on, is intended for such a sabbatical and as an incentive to stick around.

"Many universities will do a sabbatical," Rogers said.

Hamilton, 61, has expressed an interest in leaving his job when the state marks its 50th anniversary in 2009, Rogers said. And the 1,000 days he talks about is just about three years, he noted.

The report says Hamilton wants to use his final years to meet two goals, improving the university's profile as a research institution and preparing UA to train students for jobs related to the natural gas line.

The report says Hamilton may remain on at UA post-presidency, possibly as a "Regents Professor."

If the regents did give Hamilton the title, under regent policy he would be given a position in a department or academic unit in which he possessed "appropriate academic qualifications."

The position is tenured and is paid directly by the Board of Regents. Hamilton has previously said he would likely move to Anchorage upon retirement and live in a $424,000 house he and his wife Patricia bought in 2004.

The report does not say if Hamilton would work at UAA.

Still, Hamilton said he doesn't have definite plans to retire, and even Rogers said nothing's for sure. For now, the board is just happy to have gotten him rehired at rates comparable to the rest of the nation, Hughes said.

"I think it's really, really important that the university pay competitively, in all areas, staff as well as the faculty, and particularly for our leadership," Hughes said.

And Hamilton's worth every penny, Rogers said.

"Anyone who thinks Mark Hamilton is only slightly above the average, I would beg to differ," he said at the meeting. "I think we're getting a hell of a deal here."