EmailEmail
PrintPrint
Editorial: Fair pay / Non-profits must be ready to defend high salaries
Sunday, August 14, 2005

It hasn't triggered the same outrage as the legislative pay raise, but a new report on non-profits has raised a few eyebrows on executive salaries. Coming on the heels of Pennsylvania lawmakers increasing their base pay to $81,050, the salary figures for heads of some charitable institutions raise their own questions about fair compensation in organizations that rely, to a great extent, on public support.

No one needs to explain the key differences between state legislators and nonprofit executives, one of which is legislators are elected by and accountable to the public, while CEOs work for a private board of directors who set their compensation. But pay numbers for non-profits in the 2005 Metro Market Study by Charity Navigator (www.charitynavigator.org) could still have a chilling effect on some non-profit treasuries that seek the personal checks of thousands of average citizens.

The Mahwah, N.J., firm, in a nationwide study of 4,257 charities, listed some eye-popping salaries for leaders of local non-profits: $456,930 for J. Kevin McMahon, president of the Pittsburgh Cultural Trust; $280,008 for William E. Trueheart, president of the Pittsburgh Foundation; $274,144 for Mark Weinstein, general director of the Pittsburgh Opera; $227,385 for George Miles, president and CEO of WQED Pittsburgh, and $193,958 for William J. Meyer, president of the United Way of Allegheny County.

We'll leave it to the patrons and benefactors of those institutions to decide if the salaries are well-earned, based on the performance of the executive and the vitality of the organization.

Overall, however, the study said good things about the Pittsburgh metro area's 32 largest non-profits. It said the average pay for CEOs was $109,688, lower than the $148,477 national average and second from the bottom of the country's 25 largest markets. It said the Pittsburgh group was second from the top in spending on programs and fourth from the bottom in administrative costs.

Even the Charity Navigator study comes with a big caveat, however. It doesn't include foundations that receive much of their money from one person or family, economic development groups and health organizations -- sectors where some CEOs make more than $1 million a year.

As it is, the study speaks well of these Pittsburgh non-profits. While high salaries will stir up some donors, it is up to the charity's board to obtain the kind of performance that justifies such compensation to the more modest wage earners whose donations, dues and tickets pay the bills.

First published on August 14, 2005 at 12:00 am