University of Hawai'i athletic director Herman Frazier will qualify for a $15,000 bonus if his department repays its $1 million loan during the term of his new five-year agreement, according to the contract.

Three years ago, the Manoa chancellor's office gave the athletic department the interest-free loan to help it through what has become a string of four consecutive years of budget deficits dating to 2002.

A university audit last year said the athletic department had accumulated a net $4.4 million deficit through the 2004 fiscal year.

Yesterday, auditors told the UH Board of Regents that the athletic department had a $92,785 shortfall for fiscal year 2005.

A clause in the $250,000-a-year contract that Frazier signed in August says: "A bonus of $15,000 will be paid if the athletics program operates with a net increase of assets for two consecutive years and the athletics program repays in full the $1 million note payable to the university."

The $15,000 clause comes even as Frazier's contract specifies that one of his "duties" is to "maintain responsibility for fiscal and budgetary functions of the department."

Last year, Frazier presented the board with a timetable that calls for the school to raise revenues by 19.5 percent for 2006, enough to balance the budget this year and for the loan to be repaid in full next year. Frazier yesterday said the department will repay the loan in increments, and it planned to pay a portion of the bill this year.

UH interim President David McClain said last month he didn't see a problem with rewarding Frazier for something already part of his job description. McClain said, "There are debates with all of our coaches' contracts when we get into questions about how should we put achieving a certain grade point average. Should we put it in the contract or is that part of the job? There's no right answer to that. It is just a matter of what the leadership at the time feels it wants to emphasize and the situation at hand."

McClain said the $15,000 bonus provision was negotiated by the previous chancellor, Peter Englert, but approved by McClain's office. "I wouldn't have sent the contract forward if I wasn't OK with it," he said.

A UH spokesman said Frazier did not accept any of the other bonus money in his contract that he was eligible for in either 2004 or 2005.

Reach Ferd Lewis at flewis@honoluluadvertiser.com.