Friday, April 20, 2012

Nonprofit Salary Survey Launched

Salary & Benefits Survey is Now Open!
Just for completing the survey you will receive a FREE Executive Summary of the New York State data, with full salary data for all positions.
NYCON has partnered with The Nonprofit Times and Bluewater Surveys to bring you a new, improved version of the Compensation Profile of New York State Nonprofits!
NYCON Members (and all nonprofits) are now invited to participate in this statewide and national nonprofit salary and benefits survey.

Complete the survey and receive:

  • A FREE Executive Summary of the New York State data, with full salary data for all positions.
  • A 50% off the full report (estimated to be $199 currently)which will include comprehensive data on nonprofit salaries and benefits in our state - and nationwide.

    The survey is designed to be quick and easy - with help just a click or phone call away if you need it. Don't miss this chance to participate.
    Remember - all participants receive a free Executive Summary of New York State salary data and a 50% discount off the full report (which includes information about benefit offerings, costs, eligibility and employee participation for 94 employee benefits from health insurance to retirement plans.)

    Start the survey!

Sunday, April 8, 2012

Doing too well by doing good?

Story in Post-Standard on Nonprofit Pay. Visit here to see salary examples in the region related in the article.

In 2009, the head of Rensselaer Polytechnic Institute, Shirley Ann Jackson, earned twice as much as Harvard University’s president.

Jackson took home $1.8 million to run RPI, a nonprofit university ranked 50th in the nation by U.S. News and World Report.

Drew Faust, her counterpart at the much larger and No. 1-ranked Harvard, earned $875,000.

To some, Jackson’s seven-figure pay is excessive — an example of bloated compensation in pockets of the nonprofit community. Shock value alone reveals when salary is too high, critics argue.

Others disagree, saying pay — even at nonprofits — can’t be judged at face value. At best, it’s a starting point for questions about experience, performance and the competition.

While no one denies overpaid nonprofit executives exist, there’s no simple formula to single out those individuals — the industry is too diverse. What’s fair for a multinational organization with a billion-dollar budget is unfathomable for a small food pantry with three employees, and vice versa.

Spurred by a few gross abuses at downstate charities last year, state lawmakers have been trying to address the question of how much is too much.

Over the past eight months, the governor has formed a task force and issued an executive order, the state Senate held a hearing, and the attorney general released a report.

No closer to consensus, one thing is clear: The issue of nonprofit compensation is as sensational as it is complex.

Health care offers top pay

In a review of public financial information for 50 of Warren, Washington and Saratoga counties’ larger nonprofits, The Post-Star found many examples of executive compensation in excess of $100,000, including a Saratoga Hospital doctor earning $860,000.

According to tax Forms 990 from 2010, the most recent available, the highest pay locally was concentrated in health care, education, and the arts — consistent with national trends.

At Glens Falls Hospital, the region’s largest employer, longtime CEO David Kruczlnicki’s compensation was $433,000 in 2010. He oversees a $290 million budget, a staff of almost 3,000 and a health care network that includes an acute care hospital and 29 regional facilities in multiple counties.

The Queensbury-based Hudson Headwaters Health Network provided its founder and CEO, Dr. John Rugge, $430,000 in 2010. Hudson Headwaters is a much smaller organization, however, with about 560 employees, 14 Adirondack clinics and a $40 million budget.

To the south, Saratoga Hospital CEO Angelo Calbone earned almost $470,000 in 2010 to oversee a $186 million budget and 1,800 employees spread over the hospital’s main campus and six Saratoga County outpatient and primary care centers.

Pay for all three health care CEOs was less, though, than that of Skidmore College President Philip Glotzbach, who earned $470,000 in 2010. And even Glotzbach’s compensation paled in comparison to that of high-ranking hospital doctors.

Three cancer doctors employed by Glens Falls Hospital topped Kruczlnicki’s compensation in 2010. C. R. Wood Cancer Center oncologists John Stoutenburg and Aqeel Gillani had earnings of $470,000 and $485,000, respectively, while the center’s founding medical director, oncologist Robert Sponzo, earned nearly $600,000. Then-Chief Financial Officer Michael Niles took home the most that year, however, at $620,000 due to pension and other one-time payouts associated with his 2010 retirement.

To the south, Saratoga Hospital anesthesiologist Dr. Gordan Kuhar, who runs the hospital’s Pain Management Center, earned more than $860,000, making him not only the highest-paid hospital employee but by far the highest-paid individual at nonprofits reviewed by The Post-Star.

In a statement, Saratoga Hospital said it conducted market research to determine what other physicians in Kuhar’s specialty were making before setting his salary within that range.

Board Chairman Michael West said Saratoga Hospital uses outside groups to help determine pay, targeting the 75th percentile for overall compensation at similar-sized hospitals, including base pay and bonuses.

West said the market for leaders, physicians and nurses is competitive, and the hospital tries to recruit the best.

“We believe competitive compensation is required if we are to meet our goals for our community,” he said in a statement.

Glens Falls Hospital said its process for determining compensation involves hiring an outside firm to conduct market research.

Michael Clarke, vice chairman of the hospital’s Board of Governors and chairman of the personnel committee that sets compensation, said the nonprofit aims to pay its executives in the 50th percentile, or middle of the road for similarly sized hospitals.

“We’re not a typical nonprofit,” Clarke said of the hospital.

“It is a complicated business and it’s a very important business. It supports the livelihood of 3,000 employees and on the other side supports the health care of 150,000 people.”

Clarke noted other factors have to be considered when it comes to pay, such as the location of the organization and an executive’s experience and performance. Kruczlnicki, for example, has been the hospital’s CEO for more than 20 years.

In the end, the pay should reflect the complexity of the executive’s job and his success in helping the organization fulfill its mission, Clarke said.

“You can focus on the quality, focus on the community outreach that the hospital makes, or focus on the accomplishment of the goals,” he said. “The salaries are, in some ways, related to the accomplishment of all that.”

Other six-figure salaries

Other high-paid health care executives in 2010 includ CEOs of nursing and senior living facilities such as Fort Hudson and Saratoga Springs-based Wesley, who earned more than $200,000.

A few cultural organizations broke the $200,000 mark as well.

The president of the Yaddo artists’ compound, Elaina Richardson, earned $211,000, while Marcia White, president and executive director of the Saratoga Performing Arts Center, took home $281,000.

Many more nonprofits paid their leaders more than $100,000, including museums like the Hyde Collection in Glens Falls and the National Museum of Racing in Saratoga Springs; religious organizations such as the Word of Life camp in Schroon Lake and the YMCA’s Silver Bay conference center; economic development corporations in Warren and Saratoga counties; and a groups that provide services to developmentally disabled New Yorkers such as Community Work and Independence Inc. in Glens Falls, Saratoga Bridges, and Queensbury-based Warren-Washington ARC.

Human service organizations that assist low-income residents had the lowest executive pay of groups surveyed.

The heads of the Washington County Economic Opportunity Council, Warren-Hamilton Counties Action Committee for Economic Opportunity and the Tri-County United Way all earned about $65,000 a year.

The Post-Star did not find any examples of million-dollar pay at nonprofits in Warren, Washington or Saratoga counties, but they do exist closer to Albany. Jackson of RPI, for example, and Albany Medical Center CEO James Barba earned more than $1 million in the most recently reported fiscal year.

What’s normal?

According to a survey by Charity Navigator, a website that specializes in ranking nonprofits’ effectiveness, the average CEO pay at 3,000 mid- to large-sized groups was $150,000 nationwide, or $185,000 in the Northeast.

Charity Navigator defended the median pay as generally appropriate for big organizations. But the group also highlighted examples of excessive pay.

The survey revealed 14 nonprofits with executives earning more than $1 million in 2008 and another 106 with CEO pay above $500,000.

Sandra Miniutti, Charity Navigator’s chief financial officer, said arts and education institutions tend to pay more than human service providers, and college presidents or sports directors can make upward of $1 million.

If that’s atypical among the nation’s larger charities, it’s even more rare when smaller organizations are considered.

Michael Clark, executive director of the Nonprofit Coordinating Committee of New York Inc., estimates the average nonprofit CEO in New York makes $37,000 to $47,000 annually.

“Nonprofit executives across the board are being paid way too little,” said Clark. “That’s why we get the (state) contracts — we work cheap.”

United Way Executive Director Barbara Sweet, who earned $63,000 in 2010 to manage an $850,000 budget, said she and her small staff have opted to forgo pay raises two of the last five years.

“We are very aware of the need in the community and operate a lean-and-mean organization,” Sweet said.

As head of the United Way, which raises money for other community nonprofits, Sweet is familiar with compensation levels at many groups and said they work hard to meet the community’s needs with limited resources.

“That’s not us,” she said of excessive pay now being targeted by Gov. Andrew Cuomo.

In fact, many contend undercompensation is a bigger issue for nonprofits.

Doug Sauer, CEO of the New York Council of Nonprofits Inc., believes efforts to address and control outrageous pay detract from the real concern.

“This is a very little problem,” he said of excessive nonprofit pay. “(The discussion in Albany) focuses a public discourse on something that’s not real.”

Coming tomorrow: The second part of this series on nonprofits will explore efforts at the state level to address compensation abuses.


Read more: http://poststar.com/news/local/doing-too-well-by-doing-good/article_567de6ae-8123-11e1-b77d-001a4bcf887a.html#ixzz1rTSbHTZm

How much is "too much" depends on who you ask

A recent article from the Post-Star:
From industry groups to boards of directors to the Internal Revenue Service, most nonprofit stakeholders believe executive pay should be fair and reasonable.

Agreeing on a definition of “reasonable,” however, has proven challenging, if not impossible.

“If you’re running a $400 million enterprise, can you say how much that person should be making?” said Doug Sauer, CEO of the New York Council of Nonprofits Inc.

Even the IRS, which grants charities their tax-exempt status, doesn’t have a formula or threshold for salaries, Sauer noted. Instead, the agency asks nonprofits to list on their Form 990 employees earning more than $100,000, as well as pay for key officers, directors and trustees. The IRS wants to see board policies and procedures on setting compensation, no conflicts of interest, that comparable salary data is taken into consideration, and that pay decisions are documented.

Sauer, who testified before a state Senate committee hearing in February on nonprofit

executive compensation, acknowledged it’s difficult to establish a cutoff, given the diversity of nonprofits. Still, he suggested salaries above $500,000 a year merit a closer look and anything over $1 million is excessive.

Charity Navigator, a website that specializes in ranking nonprofits’ effectiveness, agrees that $1 million is a fair cutoff.

“We don’t think people should be in the business of running a nonprofit to be a millionaire,” said Sandra Miniutti, Charity Navigator’s chief financial officer. “That’s where we draw a line in the sand.”

The website uses public information about a nonprofit’s financials, transparency and accountability to rank charities by how efficiently they use donations. Miniutti said salary isn’t factored into the ranking system because it’s so subjective, but the number is disclosed so donors can ask questions and make their own judgements.

Other industry experts caution against emotional reactions to numbers without proper context.

Michael Clark, executive director of the Nonprofit Coordinating Committee of New York Inc., stressed the public can’t gauge what’s fair based on instinct because there are too many variables that go into pay, such as the size of the organization’s budget, cost of living and the employee’s experience.

“What is an astronomical salary in one part of the nonprofit world is not astronomical in others,” Clark said. “Either you believe in the market system or you don’t.”

Salary may be the most sensational number on a charity’s Form 990, but it’s not the only indicator donors should study.

At Charity Navigator, Miniutti said many donors hone in on the percentage of expenses that goes to programs or services as a solid indicator of performance.

Charity Navigator says a good benchmark is 75 percent for programs and 25 percent for administration and overheard.

The New York Council of Nonprofits aims a little higher, saying overhead should be less than 20 percent, while the Better Business Bureau’s standards for charity accountability say 35 percent overhead is reasonable.

Clark, of the Nonprofit Coordinating Committee, rejects the idea of measuring nonprofits by their overhead. He said administrative expenses go up and down based on projects, investments and growth.

“Never make a decision about whether to give money based on the ratio of administrative costs,” Clark said, adding it’s the tip of the iceberg for the questions donors should ask.

A better measure of a nonprofit’s performance, according to Clark, is whether it takes in more than it spends and has a rainy-day fund to draw on during tough times. Donors should also ask if the charity is making a difference in its community.

“It’s hard and ill-advised to apply any sort of one-size fits all rule to any nonprofit,” he said.

For his part, Sauer said larger organizations with more sophisticated accounting can figure out how to allocate time and resources to reduce overhead, while smaller groups can’t. He also believes other metrics deserve more attention than executive compensation or administrative expenses,.

The best, approach, he said, is to weigh as much information as possible.

“It’s not about executive compensation,” Sauer said. “It’s more about are people reasonably paid? Are they competent and able to show on their website that they are providing services you think should provide? Are there indications the board is functioning well and will continue to be around?”


Read more: http://poststar.com/how-much-is-too-much-depends-on-who-you-ask/article_97f7818e-8124-11e1-b514-001a4bcf887a.html#ixzz1rTPWof7J

Potsdam arts incubator project aims for new businesses

Village officials hope vacant downtown storefronts soon will fill up with arts-themed businesses.

The village is set to launch its arts microenterprise and incubator project. Potsdam received $100,000 to launch the program several months ago as part of Gov. Andrew M. Cuomo’s first award to the North Country Regional Economic Council.

Planning and Development Director Frederick J. Hanss said the funding hopefully will help launch up to eight to 10 arts-themed businesses.

“Potsdam has the reputation of being the arts and cultural capital of the north country,” Mr. Hanss said. “I hope it cements our reputation. ... I would hope it would make downtown Potsdam a more interesting place for visiting.”

The funding would be used as “seed money” for arts entrepreneurs to set up their business, Mr. Hanss said. An informational session will be held at 7 p.m. Thursday in the Potsdam Civic Center Community Room. Those who cannot attend that meeting will have another chance at 7 p.m. April 24.

“We’ll walk them through the application process and the eligibility process,” Mr. Hanss said. “We’re being pretty open for eligible use of funds.”

The program will accept a wide variety of applicants, from an artist seeking to open a gallery, a potter who intends to sell products or a musician who repairs instruments, Mr. Hanss said.

“They have to present a body of work that’s original and innovative,” Mr. Hanss said. “We’re focused on new businesses. They’re the ones that typically need a leg up.”

A panel from the arts community will determine who can be admitted to the program, Mr. Hanss said. Applicants will have to complete a 10-week course to develop a business and marketing plan for their proposal before receiving any funding, which the village will distribute.

Discounted space in Clarkson University’s Old Snell Hall will serve as an “incubator” for successful applicants.

After a period of time, the businesses hopefully would move into downtown storefronts, Mr. Hanss said.

“Nobody has really applied it to this particular segment of the economy,” Mr. Hanss said. “I don’t think anyone has done this in rural parts of New York state.”

Mr. Hanss and Hillary Oak, executive director of the St. Lawrence County Arts Council, each have received five or six inquiries into the program over the last several months.

The program is co-sponsored by the village and the arts council.

Ms. Oak said the funding could be used to help reduce the business rent or pay for marketing expenses.

“If they have an interest in starting or expanding an arts-related business, these funds might help them,” Ms. Oak said. “We want to make sure businesses that use these funds are sustainable. As far as we know, this is the first microenterprise grant program geared specifically to the arts. Hopefully by next year, we’ll have some new businesses that have been given a boost by this program.”

Wednesday, April 4, 2012

Theaters getting a box-office boost

$250,000 collaborative grant goes to Capital Repertory, Proctors

Proctors and Capital Repertory Theatre, which more than a year ago merged administrative operations, are the first recipients of a grant from a new local fund designed to encourage arts and cultural organizations to explore ways to work together for fiscal savings and programming synergy.

The two organizations were awarded $250,000 from the Arts & Cultural Collaborative Fund, established by The Community Foundation of the Greater Capital Region. The grant will help pay for expanded ticketing and other box-office operations managed by Proctors for its own shows as well as those presented by resident groups that perform at Proctors, including The Eight Step folk series and Capital Rep's season at its Albany home. Proctors has also begun managing ticketing for smaller organizations; among the first to sign up are Schenectady Civic Players and Albany Pro Musica.

"The effectiveness of nonprofits depends on relationships with other community organizations," Karen Bilowith, president and CEO of the Community Foundation, said when the grant was announced Tuesday. A news conference and panel discussion at Proctors called the Strategic Alliance Event attracted more than 60 directors, staffers and board members from Capital Region arts and cultural organizations.

Given the continuing economic strain faced by nonprofits since the worldwide financial crisis began nearly four years ago, corporations, foundations and private philanthropists are receiving unprecedented appeals for funding, said Jeffrey Stone, president of KeyBank.

"The arts have a direct impact on the health and vitality of our region," said Stone, noting that the bank was among a dozen donors that contributed to first grant from the Arts & Cultural Collaborative Fund. However, he added, given the state of the economy, innovative strategies developed jointly by cultural and other nonprofit organizations are more appealing to funding groups than simple appeals for financial relief.

Examples of savvy, effective collaborations exist across the state, said Doug Sauer, executive director of the New York Council of Nonprofits, who consulted on the Proctors-Capital Rep administrative merger.

A public television station took over and rescued a historic theater in Rochester, for example, and a vacant theater in Newburgh became a renovation project and job-training site for a nearby shelter for the homeless.

To encourage future collaborations, the Community Foundation posed a challenge to participants in Tuesday's discussion: The most innovative idea suggested at the event would win a $2,500 grant to explore ways to implement the idea. The Arts & Cultural Collaborative Fund is also encouraging grant applications for larger projects like the one undertaken by Proctors and Capital Rep.

Said Bilowith, "This is an important trend for the sustainability of our arts and cultural community and the seeds that were planted in conversations today are likely to blossom into major initiatives for the region going forward."

Read more: http://www.timesunion.com/local/article/Theaters-getting-a-box-office-boost-3457179.php#ixzz1r5qrqQWK

Capital Region Arts and Cultural Organizations Growing Stronger through Strategic Alliances

More than 60 community, philanthropic and non-profit leaders came together at Proctors' Fenimore Gallery today to participate in the Community Foundation for the Greater Capital Region's Strategic Alliance event.

This event celebrated and examined how the successful alliance between Proctor's and the Capital Repertory Theatre became a reality through nearly $250,000 in funding support from regional leaders, who themselves collaborated on behalf of the region's arts and cultural needs.

The event also encouraged and enabled future innovation and collaboration among non-profits through facilitated discussion with a panel of experts, along with networking and a monetary incentive for organizations to generate ideas for cooperative efforts. A $2500 cash award was made available for the best idea developed from the event, and a fund established by the Community Foundation was highlighted as a mechanism for future investments to support collaboration.

"We see many non-profits that are struggling to stay afloat, and collaboration is becoming an increasingly critical strategy to position them positively for the future," said Karen Bilowith, the Community Foundation's President & CEO. "We produced this event to open the doors for opportunity by educating, connecting organizations, and providing a framework for future funding."

Proctors and the Capital Repertory Theatre demonstrated a successful initiative that leveraged their organizational assets and community support to drive sustainable improvements in their bottom lines. "Our alliance with the Capital Repertory Theatre is an important regional example of what is possible," said Philip Morris, CEO of Proctors. "I'm delighted to have this opportunity to celebrate the hard work and creative thinking that helped strengthen both of our organizations. Together with my good friend, Maggie Mancinelli-Cahill (Artistic Director, Capital Repertory Theatre) we thank the community leaders that supported us and hope to inspire other non-profits to follow and enjoy similar success."

The support for this endeavor came via a grassroots team of businesses, philanthropists and family foundations who were convened by KeyBank to discuss ways they could work together on behalf of challenged arts and cultural organizations in the Capital Region. They decided to support institutions who were interested in strengthening themselves by working with other non-profits. The opportunity emerged to help Proctors grow and be able to take on the management of Capital Repertory Theatre as an important step to stabilize the struggling Albany theatre. More than a dozen donors engaged in the review of this opportunity and raised approximately $250,000 necessary to help the organizations align under a new business model. The model consolidated all key back office processes from development to marketing and finance, and leveraged a new common ticketing system that Proctors has made available for others to use.

"Arts & cultural organizations are vital to fuel creativity, enhance quality of life, and attract and retain the talent we need in our region for continued growth," noted Jeffrey Stone, President, KeyBank. "We were looking to facilitate a strong collaboration initiative to help sustain the arts," added Stone. "I'm proud of what we accomplished so far and look forward to working with the next generation of non-profits to build on this foundation."

"I left this event feeling encouraged," commented Paul Fahey, the Children's Museum of Science and Technology Board Chair and participant in Tuesday's event. "Our board and staff have been interested in this type of collaboration but wanted to learn more about the opportunities, process and pitfalls. This event really helped give us the ideas and inspiration to see what's possible and how we can make that happen with our peers in the region."

Looking forward, Karen Bilowith was excited to suggest that, "there is strong interest to continue funding this type of initiative. The Community Foundation provided the mechanism for funding these opportunities and will provide similar support for other endeavors. This is an important trend for the sustainability of our arts and cultural community and the seeds that were planted in conversations today are likely to blossom into major initiatives for the region going forward."

ABOUT THE COMMUNITY FOUNDATION FOR THE GREATER CAPITAL REGION

Since 1968, The Community Foundation for the Greater Capital Region has provided an effective means for people who care about this community to be part of shaping its future. The Community Foundation offers donors a complete toolkit for charitable giving, expert assistance in learning more about the causes they care about, and the opportunity to join others with similar interests to learn and give together.

The Community Foundation distributed more than $3 million in 2011 to hundreds of not-for-profit organizations in the Capital Region and beyond. With assets of $51 million, the Foundation is comprised of more than 340 charitable funds created by a diverse group of individuals, families, and corporations. In addition, two local independent foundations, the Bender Family Foundation and the Equinox Foundation, contract with the Community Foundation for grantmaking assistance.

Through flexible donor services, strategic grantmaking, and community leadership, the Community Foundation helps people support the causes they care about, now and for generations to come. For more information, please visit us online at www.cfgcr.org or call 518-446-9638.

Tuesday, April 3, 2012

A Major Event to Celebrate and Strengthen Arts and Cultural Organizations through Strategic Alliances: April 3

This special event will highlight one creative solution that was supported by local funders, followed by a panel presentation, a facilitated group discussion and networking lunch. Topics will include:

• Aspects of the current economic environment that may compel not-for-profit organizations

to consider strategic affiliations, shared services, and possible consolidations

• Trends, models, and best practices for strategic alliances & partnerships

• Why this model is so important to corporate and private donors, and how they can participate

Key presenters at this event include:

• Karen Bilowith, President & CEO of the Community Foundation

• Jeffrey Stone, President, KeyBank

• Doug Sauer, Executive Director, NY Council of NonProfits, Inc.

• Philip Morris, Executive Director, Proctors

• Maggie Mancinelli, Artistic Director, Capital Repertory Company

WHY SHOULD THE MEDIA ATTEND?

Your viewers and readers are strong supporters of the region's arts and cultural organizations. They know that these organizations are struggling but want to hear that they have the support of our region's leaders and donors to be positioned for future success. Beyond the arts and cultural angle, this event also focuses on the business side of non-profits.

The panel discussion and interactive forum are designed to engage and inspire other non-profits to explore collaborations, including a monetary incentive to initiate ideas and action. To that end, there is an opportunity for reporters to meet these executive directors and their board members, be there firsthand to witness new collaborations and get the inside scoop on emerging stories for future coverage.

WHO: Community, Philanthropic and Non-Profit leaders from the Greater Capital Region

WHAT: A celebration of a successful regional collaboration, panel discussions and networking to inspire and create more alliances. The event will include:

• A major donation announcement

• Presentation by community leaders and group discussion to explore and encourage more non-profit collaborations

• A monetary award opportunity for the best new idea

WHEN: Tuesday April 03, 2012 at 10:30AM Eastern Time (US & Canada)
WHERE: GE Theatre at Proctors
432 State Street
Schenectady, New York 12305
NOTES: This is event is being produced by

THE COMMUNITY FOUNDATION FOR THE GREATER CAPITAL REGION

Since 1968, The Community Foundation for the Greater Capital Region has provided an effective means for people who care about this community to be part of shaping its future. The Community Foundation offers donors a complete toolkit for charitable giving, expert assistance in learning more about the causes they care about, and the opportunity to join others with similar interests to learn and give together.

The Community Foundation distributed more than $3 million in 2011 to hundreds of not-for-profit organizations in the Capital Region and beyond. With assets of $51 million, the Foundation is comprised of more than 340 charitable funds created by a diverse group of individuals, families, and corporations. In addition, two local independent foundations, the Bender Family Foundation and the Equinox Foundation, contract with the Community Foundation for grantmaking assistance.

Through flexible donor services, strategic grantmaking, and community leadership, the Community Foundation helps people support the causes they care about, now and for generations to come. For more information, please visit us online at www.cfgcr.org or call 518-446-9638.

Monday, April 2, 2012

Awaiting, debating Cuomo's compensation abuse remedy

The Times Union gave an update on the Governor's Nonprofit Executive Compensation order:
Check NYCON too for info this issue.

In mid-January, Gov. Andrew Cuomo gave all his agencies stark orders to stop letting public dollars pump up excessive salaries of "providers of services" to the state. Within 90 days, Cuomo's commissioners were supposed to set up regulations that ban state funds from being used to pay executives of such entities more than $199,000 annually.

As the April 18 deadline to abide by the directive approaches, agencies have not promulgated anything one can read and don't seem ready to widely disclose a word, according to key agency officials.

Instead, the Cuomo administration has been trying to finesse the terms of the directive. It may privately divulge proposals soon that get to the point of Executive Order 38 while making it possible for some big partners of the state, such as New York City hospitals, to continue to pay seven-figure compensation packages to CEOs without facing consequences, according to some parties pursuing the matter.

Representatives of some affected nonprofits say Cuomo's staff has assured them that accommodations will be made; how that happens may be made clear as soon as this week. Cuomo's order would not only cap executive pay of providers that could be reimbursed with state money: He also ordered that at least 75 percent of state financial assistance or state-authorized payments be used for direct services and care rather than administrative costs. Agency commissioners are supposed to be able to use discretion to adjust the $199,000 figure annually based on "appropriate factors," subject to the approval of the director of the budget. The gubernatorial order states that if a contracting provider fails to satisfy the executive compensation and administrative spending caps, its relationship with the state could be severed.

Cuomo's aides have been looking at making the order stick only if a heavy percentage of a provider's overall revenues come from the state, perhaps 40 percent or more. Cuomo's press office declined to discuss how the regulations are developing. Agency officials say the regulations are in progress.

"The governor's office and agencies involved have been spending a tremendous amount of time on this," said James W. Lytle, a lawyer with Manatt, Phelps & Phillips, which represents several not-for-profit organizations. "There will be some briefing as early as (this) week on where they are in this process." Lytle and others said it was too bad that all service providers were coming under scrutiny because a few "bad apples" had abused guidelines such as the IRS' reasonable compensation standards for tax-exempt organizations. Several said the attorney general's office could keep track of compliance with such standards. A spokeswoman for Attorney General Eric Schneiderman had no comment.

New York has about 27,000 registered nonprofits; 22,000 have active state contracts.

Carl Marcellino, chairman of the Senate Committee on Investigations and Government Operations, said he'll introduce a bill dealing with the matter in a different way. His bill won't be a one-size-fits-all remedy and will allow employers to use the market, experience and other factors to set fair and reasonable compensation, using the IRS procedures. He said Senate Republicans wanted to resolve differences over the pay matter in legislation as part of the new budget deal, but they didn't win that argument.


Read more: http://www.timesunion.com/local/article/Awaiting-debating-Cuomo-s-compensation-abuse-3451555.php#ixzz1qtaPnHX2