How much are leaders of Tri-City nonprofits paid?

Tri-City HeraldJuly 20, 2013 

The executive director of the Tri-Cities Food Banks spends up to 60 hours a week keeping three food banks running and making sure there is enough food for the 850 families the nonprofit serves in a month.

What is he paid for his time-consuming job?

Not a penny. John Neill volunteers all of his time.

The president and CEO of Columbia Industries oversees one of the Tri-Cities’ largest nonprofits, helping provide employment training and job search aid to Tri-Citians with disabilities. The nonprofit served about 165 individuals with disabilities in the last year.

What is he paid for his time-consuming job?

Rich Foeppel made $138,000 in 2011.

Foeppel’s compensation puts him among 18 Mid-Columbia nonprofit employees paid more than $100,000 in 2011 for their work by 40 nonprofits the Herald reviewed.

Total compensation can include a combination of salary, benefits, bonuses, retirement and any other pay from the nonprofit.

There isn’t a clear black-and-white formula for what a charity executive should be paid, said Lindsay Nichols, communications director for GuideStar, a national nonprofit that gathers information about IRS-registered nonprofits to help donors make informed decisions.

A nonprofit’s board and executive have to be able to prove they’ve done the research to determine a fair executive compensation, based on what other nonprofits with the same revenue and mission pay, Nichols said.

Both the board and executive could be fined if the IRS finds that the pay is more than comparable charities, she said.

On their 990 forms, nonprofits are required to report key employees who make more than a certain amount. However, many Tri-City charities also reported salaries for key employees who made less than the reporting threshold.

Operating a nonprofit using only volunteers isn’t common practice.

Five of the 40 nonprofits the Herald reviewed operate solely with volunteers and have no paid staff. Most area charities use a combination of paid staff and dedicated volunteers to provide services.

Officials say paid staff can help a charity become sustainable and add a level of reliability and skill.

WHO EARNS THE MOST?

Of 49 paid key employees representing 25 charities serving the Tri-City area included in the Herald’s review, Junior Achievement of Washington’s statewide president, David Moore, earned the most in 2011, at almost $293,000.

Beverly Weber, president and CEO of United Way of Benton and Franklin Counties, earned $179,000 that year.

Jeanie Welch was paid $167,397 that year. She retired as executive director of Goodwill Industries of the Columbia in June 2011.

Some Tri-City nonprofit leaders have pointed out that total compensation may not be uniformly reported by all nonprofiits, making comparisons difficult.

It’s not uncommon among larger Tri-City nonprofits to have at least one employee making more than $100,000 in total compensation.

Second Harvest Food Bank of the Inland Northwest, Columbia Industries, Tri-Cities Chaplaincy, Senior Life Resources Northwest, Boys & Girls Clubs of Benton and Franklin Counties, The ARC of Tri-Cities and Tri-City Union Gospel Mission all had at least one key employee collecting more than $100,000 in total annual compensation in 2011.

The Herald excluded some Tri-City foundation leaders because the bulk of their compensation is covered by a related organization.

Of the 40 nonprofits the Herald reviewed, 10 did not identify any key paid employees, though most do have some paid employees.

Charity executives interviewed by the Herald have pointed out that they do not set their own pay. The charity’s board of directors does.

“People think you are the boss. No, I’ve got 14 bosses,” said Gordon Comfort, executive director of Goodwill Industries of the Columbia.

Overseeing $9.6 million in expenses like Goodwill had in 2011 is complex, with a lot of services, employees and retail operations, said Comfort, who earned about $65,000 in 2011, after becoming the executive director that year.

Scott Shinsato, Goodwill’s associate executive director, said Goodwill knows firsthand the danger of not having the right person in the driver’s seat. Prior to Welch’s time as the agency’s executive director in the early 1980s, Goodwill of the Columbia almost went bankrupt, said Shinsato, who was paid about $106,000 in 2011.

LoAnn Ayers, a United Way board member, said nonprofits should operate like for-profit businesses, carefully watching and managing resources. At United Way, “we need talent to manage” the complex mission and oversee the millions in community donations, she said.

It’s important to retain talent, too, because turnover is expensive, Ayers said.

And proper oversight by qualified, knowledgeable people is something donors expect, she said.

The United Way board, with help from a third-party consulting firm, gathers and analyzes compensation figures from comparable United Way chapters and other nonprofits in setting the CEO’s pay, officials said. That work involves going deeper than the 990 forms the Herald used in its analysis. And “the results mean that we can say with clear eyes and clear voice that we really did a good job of looking at apples to apples,” Ayers said.

Foeppel points to the complexity of his organization as one of the reasons his position is paid. He leads a charity as well as the charity’s for-profit company, CI Support LLC, which helps provide revenue to Columbia Industries.

“I feel that I am very fairly compensated,” said Foeppel, who has been the nonprofit’s president and CEO for about 17 years.

While he could earn more in the private sector, he said he also gets an intrinsic benefit from the job he does and the clients he helps serve.

And sometimes the organization’s size can be a reason for executive pay.

Second Harvest Food Bank of the Inland Northwest has four key employees who earned between $76,000 and $144,000 each during 2011, according to the organization’s financial records.

Executives at Second Harvest are among the few managing a charity that serves all of Eastern Washington, said Melissa Cloninger, Second Harvest’s director of community and corporate relations. The charity is one of the largest in Spokane County. Its 2011 budget was about $35.8 million.

Still, Second Harvest’s executives’ pay is less than it would be in the private sector, she said.

THE NEED FOR PAID EMPLOYEES

On any given day, more than 600 kids walk through the doors at one of the Boys & Girls Clubs’ 11 locations in Benton and Franklin counties.

Those children are part of the reason Brian Ace, Boys & Girls Clubs executive director, said 80 paid staff are needed. The nonprofit’s former executive director, Greg Falk, earned about $105,000 in 2011, according to the most recent records available.

Boys & Girls Clubs works with a vulnerable, at-risk children, Ace said. While the charity’s 200 volunteers are valuable in helping connect with children and providing positive role models, its work needs to be done in a supervised setting that ensures the safety of kids, he said.

Plus, the charity wants to have trained, professional staff in charge of youth development, Ace said. That kind of focus is needed to reach the goal of helping children succeed academically and have a healthy lifestyle, good character and citizenship, he said.

Goodwill has similar reasons for relying on paid staff. Comfort said certain positions — such as an employment counselor — require specific skills and training.

Some clients Goodwill employees work with may be vulnerable adults, Shinsato said. Having paid employees who must pass background checks gives the charity a level of control.

Goodwill wants to ensure it provides a safe and secure environment for work and job training, he said.

Goodwill has nearly 450 paid employees and clients who receive some form of pay, Comfort said.

Some job training programs pay a wage based on productivity, Shinsato said. That’s part of helping adults with disabilities go to work and have the full experience of pay, friends and co-workers.

Similar to some Goodwill programs, Columbia Industries’ clients receive pay based on productivity, Foeppel said. Clients earn a percentage of the prevailing wage for a job based on what they accomplish.

The goal is to see them increase their productivity to the point where they can transition to a job in the community, Foeppel said.

Foeppel said Columbia Industries has about 50 paid staff, some who work directly with clients, including case managers, and others on the business side.

POWERED BY VOLUNTEERS

At Pet Over Population Prevention, no one is paid.

And Molli Van Dorn is committed to keeping it all-volunteer.

The founder and president of POPP said anywhere from 30 or more volunteers help the nonprofit provide foster homes for up to 50 pets at any given time.

Last year, POPP helped get 1,491 community pets spayed and neutered and found homes for 484 unwanted pets. And it was all accomplished with volunteers, Van Dorn said.

All the donations the charity receives go directly into providing services, Van Dorn said. “We can certainly do a lot more for pets when we are not paying wages,” she said.

Van Dorn admits the volunteers who tend to do everything take on more when other help isn’t available, so she’s always on the lookout for new recruits.

“We can only help as many pets as we have fosters for,” she said.

POPP is not alone with its goal of staying all-volunteer.

Pasco’s Golden Age Food Share, which serves about 450 senior families a week, plans to stick with volunteers.

Anne Montgomery, the group’s founder and director, said the nonprofit can’t afford paid staff.

“Anything that (the public) gives goes directly to the program,” she said.

Volunteers are at the food bank Wednesday and Thursday to help distribute food. And during other days of the week, they sort and divide donated food so it can be given out swiftly to clients.

Kennewick’s Grace Clinic probably wouldn’t exist without its 200 volunteers, said board president Mark Brault. They help keep the clinic open four days a week.

The clinic has six paid staff, four of whom work part time, he said. Volunteers help with everything from reception and clerical work to patient screening. In 2011, the nonprofit operated on $478,000, according to the nonprofit’s financial records.

Grace Clinic does everything a normal doctor’s office does, except billing, because it does not charge for services, Brault said. And many of the support people at doctors’ offices do not need to have a medical license.

And volunteers are what allows the Benton-Franklin Chapter of the American Red Cross to have a large impact with three full-time paid staff, a part-time employee, a Columbia Basin College work study student and AmeriCorps volunteers. The chapter’s overall budget was about $682,000 in 2011.

“We look bigger than we are, and we do a lot with what we have,” said Jeanne Jelke, who retired as executive director of the Benton-Franklin Chapter of the American Red Cross this month.

If all the hours had to be paid, it would cost at least five times what it does now, and could be less efficient, she said.

Red Cross has about 200 volunteers who can help in various ways, with about 40 or 50 who are able to be deployed to emergencies outside of the Tri-City area, Jelke said.

Red Cross may respond to the aid of families affected by a fire once a week, Jelke said. But it also does a lot of training and community education to be able to respond to local fires and disasters in other areas.

With Tri-Cities Food Banks, it takes about 100 to 150 regular volunteers to distribute food to families in Richland and Kennewick five days a week and to families in Benton City two days a week, Neill said.

“We’ve never issued a paycheck since 1974,” when the charity started, Neill said.

It hasn’t been a problem attracting volunteers to distribute food, he said. The challenge is finding those willing to do professional work, he said.

Because the nonprofit has grown, so has the amount of paperwork and bookkeeping, requiring someone willing to do the work almost full time.

Neill said he will not accept payment for his position, which has him spending between 30 and 60 hours a week on food bank business.

But he admits there are some positions and skills that organizations will only be able to find and fill if they offer pay.

Each time a Tri-Cities Food Banks executive director has left, someone has been willing to fill that position as a volunteer, Neill said.

“We’ve been very fortunate, but I am not sure how long that will continue to be the case,” he said. “I hope forever.”

Reporter Sara Schilling contributed to this story. Kristi Pihl: 582-1512; kpihl@tricityherald.com

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