Serious lapses in “governance, management, accountability and transparency’’

Yesterday, the Boston Globe reported that State Auditor Suzanne M. Bump called Tuesday for the appointment of an outside receiver to take control of an embattled public agency. The problem: an audit of the organization found such serious lapses in “governance, management, accountability and transparency’’ that an immediate state takeover is called for.

Can BCI readers identify any other Boston-based organization that has serious lapses in governance, management, accountability and transparency?

As reported earlier in the summer by the Globe, among the problems at the state agency are allegations the former director, John Barranco, paid “himself, a former girlfriend, and a handful of top staff extravagant salaries and bonuses.”

To help pay for the exorbitant salaries, Barranco siphoned tax dollars from the 10 school districts in northern Massachusetts…

Attorney General Martha Coakley, who has jurisdiction over public corruption cases and nonprofit organizations, is reviewing Sullivan’s findings and has the authority to launch a criminal investigation…

“Our office takes allegations of the misappropriation of funds very seriously,’’ said Brad Puffer, Coakley’s spokesman…

The inflated salaries and bonuses paid to Barranco’s former girlfriend, Mary Clisbee, began shortly after she started working for the collaborative, in 1997, Sullivan said.

About a year later, after Barranco moved in with Clisbee, she was promoted to senior associate director of special education and awarded a 21 percent raise, boosting her salary to $100,000.

Annual salary increases and bonuses continued until 2006, when her total compensation topped $300,000, including a $164,000 salary paid by the collaborative and a bonus of nearly $140,000 paid by the center. In 2007, after Clisbee and Barranco ended their relationship, Clisbee left the organization and Barranco replaced her with two individuals whose combined salaries were less than half what Clisbee had been paid, Sullivan said.

It is good to see that the Commonwealth of Massachusetts takes such matters seriously and is concerned enough about ethics, use of public funds and breaches of fiduciary responsibility to the citizens of the state that they are taking serious action to try and address the problem.

In contrast, when confronted with evidence of excessive six figure salaries paid by the Archdiocese of Boston to certain lay executives, after months of public prodding, the solution was that the Finance Council would form a compensation committee. Then it took another 6 months to release a roster of who would be on the committee, and then we found the committee to review excessive compensation of lay executives is being led by a highly compensated multi-millionaire executive. They are also hiring an expensive consultant to help them, and their results will not be released until the 2011 annual report is issued in 2012. In the current economic climate, BCI thinks someone at 66 Brooks Drive needs to relearn how to spell the words  “URGENCY” and “FISCAL RESPONSIBILITY.”

For newer readers, among the excessive Boston Archdiocesan salaries we have reported on in the past are the following:

  • Superintendent of Schools: is paid $320K/year in salary, plus $29K in “other compensation not on W2″, on top of her $75K+ per year state pension. BCI asked other dioceses and found no one else is paying nearly at this level. Boston public schools with 56,000 students pay their superintendent 275,000. Much larger public school systems in Boston, New York, Chicago, and Los Angeles that serve as much as 10X to 25X the number of students and where the operational responsibility is greater–they have management responsibility for budgets, hiring/firing, curriculum, transportation, and labor negotiations–pay their top administrators $250K/year. In her last superintendent job running the Milton Public Schools, her annual compensation was $138,000.
  • Chancellor: is a retired multimillionaire banker whose total compensation is over $250K/year and whose 5-year compensation is $1.2M in salary. The former CEO of Abington Bank, he held 244,665 shares or 6.28% of the stock when it was sold to Seacoast for $139.4 million in June of 2004, making his stock at the time worth nearly $9 million. When he took the Chancellor job in 2006, he said he was “very blessed and didn’t need a job.” If he didn’t need a job, why is the cash-poor archdiocese paying him about $2.5 million in total compensation over his two 5-year terms?
  • Communications Secretary. Currently makes $162.5K in W2 salary, plus $30K in other compensation not on the W-2. By means of comparison, the lay communications secretary who preceded him started at about $100K and was making $115K when she left. As another comparison, according to this ”Your Tax Dollars at Work” listing, Gov. Deval Patrick’s former communications director and press secretary, Kyle Sullivan was paid $97,850/year in 2009 to communicate information for the Governor of a state with an estimated population of 6.6 million people and a budget of about $27 billion. The Boston archdiocesan communications secretary reactively communicates information–largely as damage control when negative press is hitting–for an archdiocese of about 300,000 Church-going Catholics and 1.8 million total Catholics with a $34M Central Ministries budget. Regardless of how you do the math, the person in his role should be making no more than $115K.
  • Pension/Medical Plan Trust Administrator: in Boston makes nearly double what other dioceses pay for someone doing this same function
  • Associate Superintendent of Schools: has seen his salary increase 32% in 4 years, from $137K in 2006 to $181K plus $32K in “other compensation” in 2010.

Other examples can be found in our March blog posts, Reducing Salaries and Finance Council Top Ethical Concerns: #4: Compensation–Six Figure Salaries.

As of the 2006 Fiscal Year, the 4 highest paid lay employees (above $137K) were paid a total of about $689K.  If we compare apples and apples in the 2010 Fiscal Year, we find 9 highest paid lay employees whose salaries were disclosed in the 2010 report were paid salaries of almost $1.9M–3X what it was four years ago.  And if we add in just 5 more key employees whose six-figure salaries were not disclosed in the 2010 report–Development/Institutional Advancement Secretary and Vice President, Executive Director of Finance and Operations, Professional Oversight Director, Pension Trust Administrator–we find about 13-14 highest paid lay employees making around  $2.8M in salaries–about 4X what was being paid four years ago. This all has happened in one of the worst recessions most readers can remember.

An archdiocese whose Code of Conduct policy says they want to be “responsible stewards” of the financial resources of the archdiocese and use resources in a way that reflects Catholic social teaching might do well to revisit the story of the prodigal son in Luke 15:

“When he had freely spent everything, a severe famine struck that country, and he found himself in dire need.”

The ongoing economic crisis in the U.S. and the world is severe. A salary cap of even $150K/year on 10 highest employees would save the Boston Archdiocese more than $1 million annually, as described in our post How to Save $2 Million Annually Without Really Trying.

In view of the worsening financial crisis likely to affect donations to parishes and to the Catholic Appeal, and considering the need for greater accountability to the people of God in Boston of how limited donor resources are used, perhaps yet another item on the agenda for the new Vicar General when he arrives in September should be addressing this matter of excessive six-figure salaries at a more urgent pace than is currently happening.  What do you think?

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17 Responses to Serious lapses in “governance, management, accountability and transparency’’

  1. David S. says:

    Isn’t the Archdiocese of Boston a public charity?

    The salaries you quote, particularly $320K for the Archdiocese of Boston Superintendent of Schools Mary Grassa O’Neill, is absolutely absurd.

    How can the Archdiocese look at us with a straight face and ask us to contribute to the Cardinal’s Appeal?

  2. jbq2 says:

    Without a doubt, this is a good posting. However, I have a question which eludes me. What do the clergy who are being paid nothing get out of this? There has to be some “quid pro quo”. Otherwise, this does not make sense. You could put well qualified deacons and nuns into the same positions at minimum salaries. These high salaries go with deductions for such as social security and medicaid. Priests now receive salaries for this same reason. The government then pays for retired priests out of their salary and deductions. There is a slight connection here but the money trail does not make sense like the very good example that you started with. There was an obvious “gumdrop” involved. However, what is the “candy connection” between unpaid clergy and 300K salaries for the laity. It could be nepotism and a connection with the political privies in Massachusetts like Doniphon and Biden. However, it is nebulous.

  3. Suzanne says:

    I wonder why this blog never seems to comment on the exorbitant salaries paid to Scot Landry in his past and current executive positions with the Archdiocese, as well as his [edited by BCI] job performances in both positions.

    Hmmm, why might that be . . . ??

    • Suzanne,
      Perhaps you missed this post (linked to above in the final hyperlink of the post), “How to Save $2 Million Annually Without Really Trying: Part 1“. In that post about reducing excessive spending on top ten salaries, we recommended the salary of Scot Landry be reduced to $150K.

      BCI has focused on the most egregious cases we are able to document and independently verify. The 2006 annual report shows that the previous Secretary for Institutional Advancement, Kenneth Hokenson, was paid $217K/year in his final year. BCI has asked other dioceses and has been unable to get sufficient information about salaries paid to chief development officers that we can make a statement saying the compensation paid in Boston to Scot Landry for this role was way off the mark. For the other roles where we have criticized the salaries as excessive, we tell you exactly basis for our criticism. If you can gather verifiable information from other dioceses about compensation for the development role, please send it our way and we will be glad to publish it.

      That said, now having at least two people in that office, each making more than $200K/year–feels objectively excessive to BCI. Do not be surprised to hear more complaints about that in the future!

    • Pastoral Center Staff Member says:

      Suzanne,

      If you think Landry or anyone else shouldn’t be paid more than a certain salary, you would have support of certain staff members.

      But NO ONE on the pastoral center staff, even those with heterodox theology, would agree with your assertion of “extremely poor performance” in his development role or especially what he and his team have been able to accomplish in his first year in Catholic media and communications.

      His team in development made their goal each year. His successor and her team miss by 3 million in the first year. He spent a lot of time helping parishes with fundraising. His successor outsourced the work to parish financial services, none of whom have fundraising experience. He and his team reached out to help the other ministries at the pastoral center and cared enough to get to know every ministry they were helping to fund, creating photo directories and other great resources like an intranet for the entire pastoral center. Most of the new team (with a couple of exceptions) is considered arrogant by the pastoral center staff and by many priests. Everyone at the PC knows Landry and his team were screwed by McDonough and Connors, yet they tool it with considerable class and have done a lot in media including a lot of the work for Catholics Come Home.

      By what do you measure success and failure?

      They did fail at one thing – rearkissing the likes of Connors and the other “heavyweights” whose egos new stroking. The people in the trenches the effort of his team to always help with pastoral center events and needs.

    • Michael says:

      I have to agree with Suzanne. Anyone and EVERYONE who is being “overpaid” needs to be exposed. I do not care why the blog author may or may not like a particular person … and therefore may give deference to someone like Scott Landry … ALL of these people need to be exposed.

      I do not believe (as Suzanne seems to intimate) that Scott Landry (or his brother) is the author of this blog … although nothing would surprise me.

      When government officials prove to have more ethics than members of the Catholic Church, God help us. Scott Landry ought to be ashamed of himself. In my opinion, he is stealing money from the Catholic Church. The Deputy Superintendent (making well over $181,000) ought to be ashamed of himself. He is stealing money from the Catholic Church. I am pretty certain Mary Grass o’neill has no shame. She is stealing money from the Catholic Church.

      As a group, they are all responsible for my decision (last year – the year I finally was able to give a significant tithe to my favorite charities) not to give a single penny to the Archdiocese (NOR to my parish church). This “stealing from the Church” issue needs to be cleared up before I ever give anything else to any of them (parading around as the Catholic Church).

      I do not consider it possible to actually be a member of a group that one is caught stealing from. These people are stealing from the Catholic Church.

      • In case readers somehow missed it, this blog has been explosing excessive six-figure salaries for more than a year now. We first listed salaries, including Scot Landry at $250K/year as one of the 5 top-paid employees on June 23, 2010, our first day of the blog.

        Though BCI has voiced praise or enthusiasm for certain moves (e.g. we are excited to see a new Vicar General coming) and BCI has commended certain individuals on occasion (not Scot Landry), BCI takes offense at the suggestion that BCI might “like” a particular person or is in any way giving deference to anyone. That is simply untrue. Furthermore, BCI has repeatedly said this blog is not written by anyone in the Pastoral Center and our primary sources of information are from outside of the Pastoral Center. To make the point even clearer, neither Scot Landry nor Fr. Roger Landry are behind BCI.

        In our blog posts, we expose the most egregious situations we can document and verify. We believe we have done a pretty good job at that, given a lot of limitations. Some readers seem to forget that BCI is not a newspaper with a full-time paid staff doing nothing but researching articles/posts and writing. If one of those criticizing our coverage of excessive salaries has time and connections to gather verifiable information from other dioceses about compensation for their development roles (or Catholic Media roles) more effectively than BCI, please do us a favor and get the information, write it up with the details that can be verified, and send it our way–we will be glad to publish it. Or, if one of those criticizing us has more time to dedicate to this and thinks you can write a better blog about these issues, go for it. Let us know when you hang your shingle up so perhaps we can learn something from your deeper knowledge and superior ability to research and report on more people and situations than BCI can do.

        For those not inclined to start their own blog who are content with BCI, we would welcome an occasional guest post that is well researched/documented and has objectively verifiable information, not personal attacks.

      • Mary Reilly says:

        Michael,
        “Stealing” is a strong word. I’m not sure what your definition of “stealing” is or what salaries you think people who work for the Catholic Church can justifiably earn, but I’d urge you to be more careful when you’re using that word to attack people in a public venue like this.

        $150k, as BCI proposes, seems like a reasonable cap for senior executives working in the Catholic Church, given their life experiences, backgrounds, and what they might earn elsewhere. If someone’s already worked a 30-year career and is retired with a comfortable nestegg and/or is an empty-nester who doesn’t need the money to support a family (like Jim McDonough, Mary Grassa O’Neill, Beirne Lovely, etc.) the standards for compensation might well be lower–or certainly different vs someone who is 30-50 years old who has a family to support (maybe including a stay-at-home Mom) and who can make $125-150K in a private sector job but chooses to work for the Catholic Church because they want to serve God.

        If salaries for senior leaders/executives are limited to some lower level, like even $80-100K, you’ll exclude a lot of talented people in a certain age range and only get young, less experienced people, or wealthy retirees.Is that your idea?

        Before you lambast BCi and other people by name publicly, why don’t you go do your homework and find out what common salaries are in other dioceses, like BCI suggested. If you’re crusading for every diocese in the country to cut all salaries to some level below $100K, good luck.

      • Michael says:

        In response to Mary Reilly:

        Can we agree that if you decide not to pay someone who does actual work for you, that would be stealing? Likewise then, is it not also stealing to be paid (to accept payment of) an unjust salary? Is it moral to accept overpayment … and I don’t mean overpayment by a little … overpayment by a massive amount … whatever your subjective idea of the perfect amount is. I consider it stealing, especially when most people who give money to the Church would be disgusted upon learning of the actual salaries being given out to a very few people in the Archdiocese. This is particularly unjust when viewed in context with the salaries of the majority of hardworking poor bastards who work their tails off for the Archdiocese at modest (if not pathetically low) wages. Are these lower paid people dumb (or are they acting morally?)?

        Deuteronomy 25:13-15
        You shall not have in your bag differing weights, a large and a small. You shall not have in your house
        differing measures, a large and a small. You shall have a full and just weight; you shall have a full and just measure, that your days may be prolonged in the land which the LORD your God gives you.

        Proverbs 11:1
        A false balance is an abomination to the LORD, but a just weight is His delight.

        Luke 16:10
        He who is faithful in a very little thing is faithful also in much; and he who is unrighteous in a very little thing is unrighteous also in much.

        Jeremiah 22:13
        Woe to him who builds his house without righteousness and his upper rooms without justice, who uses his neighbor’s services without pay and does not give him his wages.

        If a person receives payment above and beyond “a full and just” salary, that person is morally “stealing.” I do not see why sugarcoating is necessary.

    • Suzanne, the second half of your comment represents a personal attack of the nature BCI has repeatedly warned readers against making. Because you are suggesting BCI has some bias, which is not correct, and because other readers have responded to points you made, we are leaving the majority of your comment so readers can see the basis for subsequent responses. Please avoid such attacks in the future.

      • Martin says:

        To say that BCI is an unbiased view of the actions of the leadership of the Archdiocese of Boston is laughable. I have been reading this from afar since late last year. I used to work for another diocese and have been following your gossip blog for the entertainment value. Your focus is on attacking individuals and you seem to be missing some of the real issues facing the Catholic church. Salaries are not the issue, have good authentic Catholic leadership is the issue. As you continue to focus on

      • Martin,

        When people come to BCI who are not regular readers, post for the first time by throwing bombs, and make statements like you have just made without specifics to back your complaint, it is annoying beyond words If you were a regular reader of the blog, you would be aware of posts on a variety of topics, including the absence of authentic Catholic leadership. See this post as one example.

        http://bostoncatholicinsider.wordpress.com/2011/01/16/musings-on-the-future-of-the-archdiocese-of-boston-episcopal-leadership/

        Salaries and a number of other issues and concerns are reflective of failed leadership. If you want to go and write a blog that talks about authentic Catholic leadership and post several times a week with your unique timely insights, please free free to do so.

        Furthermore, you do not even have your criticism accurate. In this post, BCI did not attack individuals–BCI merely criticized the compensation of various individuals.

      • Mack says:

        Martin, to characterize BCI as a “gossip blog” makes me wonder if you’ve really read it as you say you have. BCI posts facts, figures, statistics–its claims are solidly backed up. It is far from being gossip! It is a necessary exercise, unfortunately, since things are so messed up in this archdiocese.

  4. Lost Soul says:

    What is a “Professional Oversight Director”? What does the Executive Director of Finance do besides twiddle his thumbs? More chiefs than indians. You cannot say that RCAB is not doing its fair share in attempting to create jobs. Somebody let the President know.

    • Carolyn says:

      Lawyer who receives allegations of misconduct by priests and lay employees of RCAB, and formulates and implements policies for the prevention of same. Idea wsa to reduce dependency on outside law firm for same.

  5. QC Guy says:

    I understand BCI’s ire at the bomb thrower comments and criticism, but I would rather see your frequent examples of well researched fact and commentary than today’s ‘tit for tat’ discussion.
    Keep up the great work and as I have said before ” non illegitmi carborundum est” [ apologies to Sister Mary Regis, SSJ at Matignon so many years ago for the very bad Latin ]

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