As the worst recession in decades stripped thousands of Bay State workers of their jobs, a small group of people saw greenbacks continue to fatten their paychecks: the leaders of the state’s top tax-exempt organizations charged with aiding the poor, mentally handicapped and other disadvantaged residents.
A Herald review of well-known charities and foundations found nearly a dozen that doled out $300,000 to $600,000 in salaries and benefits last year to their CEOs.
“You have to pay for talent,” said Paul Clolery, vice president of the trade publication Nonprofit Times. But, he added, “the (U.S.) president makes $400,000 a year, and that job has a lot of responsibilities.”
As examples:
The Boston Foundation’s Paul Grogan, CEO, earns a total of $596,646 a year between his salary and benefits.
OXFAM America CEO Raymond Offenheiser earns a total of $434,828
Perkins School for the Blind President Steven Rothstein earns $325,314
Greater Boston Foodbank CEO Catherine D’Amato earns a total of $315,404
Morgan Goodwill Industries President Joanne Hilferty earns $306,750 (Go to the online article to view the graphic)
Yet several tax-exempt groups compensate their leaders with pay and benefit packages that rival the president’s salary.
Paul Grogan, CEO of the Boston Foundation – which dishes out millions each year to support Boston-area charities – took home nearly $600,000 in pay and benefits last year, topping his total compensation for 2007 by over $40,000.
Rivaling Grogan was Willis Hulings, president of The Education Resources Institute – a student-loan information provider and lender. In 2008, the same year TERI filed for bankruptcy, the nonprofit spent $583,285 on Huling’s pay and benefits – nearly a $40,000 increase from the previous year.
Several more Hub charity chiefs collected presidential compensation packages of at least $400,000: Joseph Flatley, CEO of Mass. Housing Investment Corp., which helps finance affordable housing projects; Gary Lamson, president of Vinfen, a mental illness service provider; Raymond Offenheiser, CEO of Oxfam America, an international relief organization; and Walter Christian, president of the May Institute, a service provider for those with autism.
The groups defended the pay as necessary to secure skilled leaders.
A spokesperson for the Boston Foundation said that Grogan’s salary is competitive and added that he’s taking nearly a 5 percent pay and benefits cut for 2009, along with the rest of the staff at the foundation.
Hulings said he, too, is taking a pay cut in 2009, and that last year’s compensation includes a bonus that was set in 2007 when “we had a pretty good year.” He added that TERI is one of the state’s largest nonprofits and yet his paycheck is not the highest. He blamed the bankruptcy on the global credit crisis, and said he hopes to emerge from Chapter 11 restructuring by early 2010.
The May Institute said its CEO “must be a doctoral-level, licensed, board-certified clinician” and that, over the past three decades, its president has expanded the institute to serve 25,000 people and their families.
Oxfam America, meanwhile, said in a statement that it “will have a greater impact if we pay salaries that attract and retain the leaders with the right set of skills and experience.” It also said that its president’s 2008 compensation included a “one-time” retroactive pay increase of $50,000.
Thomas Pollak, a senior researcher at the Urban Institutes Center for Nonprofits and Philanthropies in Washington, D.C., says he understands the need to pay for skilled leaders who can attract large donors. But, he said, boards of directors who set pay should remember that they are leading charities, not private companies.
“My personal feeling is that an organization should be willing to develop a culture of public service . . . so, you’re going to pay public service-level wages,” he said.
The Herald did find several Hub nonprofits that manage to pay their chiefs far less, though they have comparably sized operating budgets.
For example, the homeless-housing provider Pine Street Inn has a $32 million budget, nearly five times the size of Mass. Housing Investment Corp.’s. Yet its president earned less than half of Mass. Housing’s CEO last year. And service-provider Action for Boston Community Development and the Boston Foundation both have similarly sized operating budgets, at around $130 million. Yet ABCD’s late president Robert Coard was paid last year less than half of Grogan’s chart-topping salary.
Nonprofits’ top perks:
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