How Information for The Chronicle’s Salary Survey Was Compiled

For the 10th year, The Chronicle has gathered information about

what the nation’s largest nonprofit organizations pay their top officials.

This year, 284 groups were asked to fill out a survey and provide supporting information from their Form 990 informational tax returns and audited financial statements. They were asked to provide information for the 2000 fiscal year, or 2001 for those with fiscal years ending in January, February, or March.

The survey seeks information about each organization’s chief executive and its other highest-paid employee. The Chronicle asks groups to provide information about the employee whose regular compensation is the highest, and not someone whose compensation is inflated by a one-time payment, such as a severance or pension payout.

Of 280 organizations that returned the survey form or sent in their Form 990, 27 groups had received a filing extension from the Internal Revenue Service for the 2000 or 2001 fiscal year, so the information on their top officials’ compensation is based on 1999 or 2000 data.

Although religious groups are not required to file tax returns, several provided The Chronicle with salary data. Four religious groups — Catholic Foreign Mission Society of America (Maryknoll Fathers and Brothers), National Council of the Churches of Christ in the USA, Presbyterian Church (U.S.A.) Foundation, and St. Labre Indian School — declined to provide information.

For the second year in a row, the Salvation Army provided information for its highest paid employee other than its chief executive but not the identity of that employee. As a religious organization, the Salvation Army is not required to provide salary data to the public.

The survey form asked for detailed breakdowns of the financial data reported on Form 990. The breakdowns show how charities report deferred compensation, pensions, housing allowances, and other perquisites.

Some charities provided more information on their Form 990 than is required by the IRS. For example, both the Minneapolis Foundation and Scripps Health, a part of Scripps Foundation for Medicine and Science, included detailed data on their employees’ benefits and expenses.

In a change from past years’ surveys, income for United Ways includes funds that donors have earmarked for specific groups.

For many years, the Financial Accounting Standards Board, a private, nonprofit group, and the Internal Revenue Service have stated that gifts that donors earmark for specific organizations, such as homeless shelters or health-care charities, should not be counted as income. That had been the standard The Chronicle had used in the past for its salary survey.

But in May, the IRS issued a private-letter ruling to United Way of Southeastern Pennsylvania, in Philadelphia, that states that the organization can include donor-designated funds on its Form 990. While a private-letter ruling applies only to a group that requests it from the IRS, The Chronicle this year has used the ruling as the basis for reporting all United Way income numbers in the expectation that other United Ways will eventually employ the same reporting standard on their Forms 990.

The groups in the salary survey are those that ranked highest in their categories on the 2000 Philanthropy 400, The Chronicle’s annual list of the charities that raise the most money from private sources.

Several charities that were not on the 400 listing were also asked to provide information because in some categories only a handful of organizations raise enough to make the list. Organizations added to the survey were ones that raised the next-highest amounts.

The salary survey also includes officials from the 20 wealthiest private foundations and, for the first time, 19 of the nation’s largest operating foundations.

Three officials, rather than two, are listed for several organizations in the survey.

Ayco Charitable Foundation, in Albany, N.Y., and Liliuokalani Trust, in Honolulu, had ties in compensation for the highest-paid employee other than the top executive. PATH-Program for Appropriate Technology in Health, in Seattle, had a tie in compensation for its top executive. PATH’s board of trustees asked two people to serve as acting co-presidents during the last two months of the organization’s fiscal year, while a search for a new top executive was conducted. The two officials have since returned to their former positions.

Yale University, Harvard University, Washington University in St. Louis, and the Cantigny Foundation, in Chicago, did not include in their informational tax returns the cost of housing provided for their top executives. They said they did not include it because the housing is located on property owned by the organizations and the executives must live in the housing as a condition of employment

The Chronicle’s salary survey was directed by Martha Voelz with assistance from Marni D. Larose and Michael Anft.