RECENT QUESTIONS FROM SENATORS REGARDING POSSIBLE EXCESSIVE EXECUTIVE COMPENSATION AND OTHER EXPENSES

Blog
March 13, 2010

The current political climate has been heating up in recent months over nonprofit excess benefit transactions and excessive executive pay.  There is increased scrutiny by the IRS, which could be stemming partly from increased pressure from Congress and Senator Chuck Grassley (R-Iowa) who is the Senate Finance Committee ranking minority member.  The most recent account is in a letter Senators Grassley (R-Iowa), Coburn (R-Oklahoma), Kyl (R-Arizona) and Cornyn (R-Texas) sent to the Boys & Girls Clubs of America questioning whether money is being spent on programs, or on excessive executive pay and benefits.  Apparently, the spotlight was put on this group as the national nonprofit reported a loss of more than $13 million, while paying its president and chief executive “nearly $1 million in compensation in 2008” according to a Washington Post article.   According to the article in the Post, while the national organization in Atlanta, Georgia has been providing executive pay reportedly double the comparative levels, the struggling local chapter here in Washington had to close 3 of its clubs and lay off 10% of its staff.  See the entire Washington Post article:

http://www.washingtonpost.com/wp-dyn/content/article/2010/03/12/AR2010031204061.html

and a recent blog article on the topic:  http://www.aronsonblogs.com/AISG/?p=262