Debt-Ridden Boston Archdiocese Pays Lay Execs $3.7M, Violates Fiduciary Responsibility and Motu Proprio

The Boston Archdicoese, saddled with $137 million in debt and operating deficits of $11 million in the past two years, paid their top lay executives $3.7M in salaries and benefits in the past year. They acknowledge many are overpaid, and to add insult to injury, they even gave raises to some overpaid execs last year. This excessive spending on salaries violates the diocese’s fiduciary responsibility to make proper use of donor funds, and it also violates the recent Motu Proprio from the Pope Benedict XVI. Because the Massachusetts Attorney General has oversight for Non-Profits and their use of donor funds, she has reason to intervene.  Meanwhile, Cardinal O’Malley appears to be fiddling, as the fiscal and moral version of “Rome” is burning.

There is enough content here to take multiple blog posts. We will cover as much as possible today and continue in subsequent posts.  That Boston was paying excessive six figure salaries to lay execs has been a public complaint for more than three years. That nothing is being done about it, even with the window-dressing of a “Compensation Committee” formed in 2010 is an even bigger travesty, especially even after publication of the Pope’s “Motu Proprio.” First we cover the “Motu Proprio” and diocesan code of conduct guidelines, then the salaries, the Compensation Committee report, and then examples.

“Motu Proprio

Signed on November 11, 2012 by Pope Benedict XVI and officially in effect December 10, 2012, the Motu Proprio says salaries need to be in due proportion to analagous expenses of the diocesan curia.

§ 4. In a particular way, the Bishop is to see that the management of initiatives dependent on him offers a testimony of Christian simplicity of life. To this end, he will ensure that salaries and operational expenses, while respecting the demands of justice and a necessary level of professionalism, are in due proportion to analogous expenses of his diocesan Curia.

Priests in the Boston curia are paid about $41K annually.  How can anyone in the Boston Archdiocese claim that the $300K+ salaries of their top execs are in “due proportion” to the analogous expenses of the diocesan Curia? Here is our December blog post describing the violation.

Archdiocesan Code of Conduct

The diocesan Code of Conduct says:

“Church Personnel will be responsible stewards of the resources, human and financial, of the Archdiocese and any Archdiocesan Affiliated Organization with  which they are associated, observing both canon and civil law, and making decisions concerning the disposition of resources that reflect Catholic social teaching.”

Salaries Disclosed in 2012 Annual Report

The 2012 Annual Report released on Friday, January 18, reports that 16 lay executives are paid more than $150,000 a year, and on top of that, another 10 are paid $100K or more a year. The salaries of the top-paid execs can be found in pages 77-82 of the pdf.  12 of the 16 people paid $150K+ are listed in the report, but it is easy for anyone to determine with high certainty who the other 4 are from the Pastoral Center directory based on titles.  (BCI knows several are paid $200K+ and the others a little less than $200K, so we assumed an average of $200K for their salaries in the table below).  To make it easier for you to see all 16, we have arranged the publicly available data in the table below (click on image to zoom):

RCAB salaries 2012

Compensation Committee Report

The short version of the story here is that the “Compensation Committee” formed in November 2010 to study compensation and address the complaints about excessive six-figure salaries spent tens of thousands of dollars of donor funds and accomplished next to nothing.  Their “report,” if you can call it that, is on page 83 of the Annual Report.  They hired a consultant, AON, to do a study, which probably cost a minimum of $30K.

“We determined that the competitive environment varies by position. Depending on the job, the arena in which we compete for talent includes some or all of the following: other Catholic organizations, other not-for-profit groups, and for-profit organizations. The peer group against which we measure ourselves is tailored for each position. The consultants accessed numerous data bases containing applicable information, and conducted a custom survey of Catholic dioceses. The results of the study are as follows:

a. Six of the senior lay executives are paid between the 50th and the 75th percentiles;
b. Five of the positions have attributes that are unique to our Archdiocese, and are paid comparably to peers in the Archdiocese with similar levels of responsibility; and
c. Five of the senior lay executives are paid above the 75th percentile.

“The Committee believes that, over time, most senior lay executive positions should be paid at approximately the median compensation (or 50th percentile) identified in the salary study, as updated from time to time.”  There is more, but wait a moment.

In other words, a) 6 of 16 people are slightly to somewhat overpaid, c) 5 of 16 people are way overpaid (note, there is no upper limit specified, so some could be off the charts overpaid), and b) 5 other people are overpaid comparably to their Boston Archdiocesan peers who are overpaid, but we justify it based on their “unique attributes.”

Hmm.

Now the “unique attributes” justification:

“There are, however, factors that may require pay at levels that differ from the median, and the amount any particular individual is paid should reflect such factors. These include the nature of an individual’s experience to include the time and performance in the role, the uniqueness of an individual’s qualifications, the scope of the position relative to those included in the salary study, the strategic importance of the position, and the urgency and seriousness of any problems that need to be addressed. All individuals in the group are currently paid at a level that is consistent with our compensation philosophy.”

So, once they determined that basically everyone was overpaid, then they apparently created a “compensation philosophy” to justify overpaying everyone. That philosophy is summed up here:

“Our philosophy is based on the belief that senior lay executives are employed by the Archdiocese to advance the mission of the Church, and that accomplishing this goal requires competent, compassionate, efficient and effective leadership. The purpose of the compensation system is to enable the Archdiocese to attract and retain individuals whose personal goals and achievements are in harmony with the Church’s teachings, and whose motivation, talents and capabilities will assist the Church in achieving its objectives. This means that our pay practices must be: (i) competitive, so that we are able to hire people with the requisite qualifications; (ii) equitable, so that our employees are paid fairly relative to one another; and (iii) realistic, so that they reflect economic conditions in the Archdiocese and in the wider world.”

Without seeing the actual AON study, there is no proof they achieved (i) or (ii) and lots of other evidence they did not, and it is abundantly clear they have not achieved a compensation scheme that reflects the economic conditions in this archdiocese, where 40-50% of parishes cannot pay their bills and Central Operations lost $11M in the past 2 years. They apparently missed the “Motu Proprio” and should go back to work to add a new item “(iv) pay in due proportion to analogous expenses of the Boston diocesan Curia.”

The poster-child for excessive compensation, Mary Grassa O’Neill (see “Up in alms over salaries”), is perhaps the highest-paid lay Catholic diocesan employee in the country, making far more than public school superintendents in New York and Los Angeles who have 10X+ more responsibility. She just had her pay upped from $325K to $341K. Just one more quick example of the evidence they are over-paying is:

Carol Gustavson: Executive Director Lay Benefits: $169,190. A proud ex-Catholic whose previous experience was as a labor attorney for a newspaper. When they slashed lay pensions in 2011, readers reported she was unable to respond to basic questions about pensions in the public meetings. As reported here, she was making $149,999 before her job as Executive Director of HR was reduced by about 2/3 in 2011. Other archdioceses we surveyed said they were not paying their head of HR nearly what Carol was making when she was responsible for HR and paid $149,999–coincidentally, just enough to fall below the $150K limit for reporting in past years.   Jim DiFrancesco is “Director of Human Resources” and Carol is largely just responsible for Pension/Medical Trust (minus the prior work of dealing with plans for 10,000 Caritas Christi employees who now are Steward Healthcare’s responsibility).  A pension/medical plan administrator for an archdiocese like Boston makes around $80-85K.  Amount of excessive pay: $70-80K.  Oh, we forgot, she is also responsible for bringing yoga into the Pastoral Center.

The whole situation is frankly, preposterous.  It will take us multiple blog posts to address the depth of the problem.  Now that the Boston Archdiocese has just finished giving fat raises to most of overpaid people (a topic for the next post), all the Compensation Committee is doing is the following:

At the Committee’s recommendation, no merit increase was granted for FY 2013 to any member of the senior lay executive group whose salary was at or above the applicable median. In the future, compensation should be limited to levels that satisfy our compensation philosophy through tools such as renegotiation of contracts, sunsetting of current pay and/or salary freezes.

In the future?  How about in the present while the archdiocese is $137M in debt (not counting the $50M in lay benefits owed to former employees, off the books entirely now), is running a $6M annual operating loss, and has half the parishes in the red? Why not immediately start reducing salaries by 10% as of 90 days from now, with successive 10% cuts every 90 days until they get overpaid execs where they need to be?

Every Catholic, plus the Attorney General and Vatican should be up in arms about this financial scandal. If you care about the future ability of the Boston Archdiocese to carry on the saving mission of Jesus Christ, click below to send a copy of this blog post via email to the Papal Nuncio  [nuntiususa@nuntiususa.org] the Massachusetts Attorney General Division of Public Charities [charities@state.ma.us] and the Boston Globe [newstip@globe.com].

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29 Responses to Debt-Ridden Boston Archdiocese Pays Lay Execs $3.7M, Violates Fiduciary Responsibility and Motu Proprio

  1. Boston Pastor says:

    BCI, thanks for this impressive analysis of the situation in Boston. I know this post is about salaries, but on top of this, you didn’t mention the IFRM model that imposes a mandatory tax on parishes to support the overpaid Pastoral Center bureaucrats’ salaries. I’d like to see Chancellor Straub release the actual AON study with the salary bands so it’s out there in public who’s overpaid but has still been getting salary increases. Keep up the excellent work!

  2. Appauled says:

    I would like to see the performance reviews for these top performers. From everything I know and have read, Scot Landry does not contribute at the level he is being paid and has left of path of destruction in his wake. BCI is suprised that the Benefits lady is paid too much but she does not go on the air each day and profess to be a good Catholic and then laugh all the way to the bank,

    • Appauled,

      Allow us to make several points in response.

      First, it is unlikely that performance reviews would ever be shared publicly. It is also not clear to us that these people have been rated as “top performers. Most of the justification for the high compensation was tied to “the uniqueness of an individuals qualifications,” the time in the role, the scope of the position vs others in the salary study, and subjective determination of “the strategic importance of the position, and the urgency and seriousness of any problems that need to be addressed.” That means, if the Boston Archdiocese is urgently dealing with a seriously big debt in the retirement funds, they can have an unqualified or poorly-performing person in the benefits administrator position and somehow justify over-paying them. Or they can somehow justify over-paying Terry Donilon in Communications because he has been in the role a long time and Communications is a strategically important role, while still not being anywhere near a top performer, or even a capable speller or writer!

      Second, let us be careful to avoid personal attacks here. If you have objectively observable facts from which to base your comments, you can share them, but please keep away from the vague “from everything I know and have read.”

      Third, no BCI is not surprised that the Benefits lady is paid too much. It is par for the course. We just cited her as one example for today. More are coming soon.

  3. Catholic Teacher Man says:

    How in the world does Grassa-ONeill justify her salary?
    Is she increasing enrollment in schools? NO
    Is she keeping schools open? NO
    Are Catholic schools, in general, promoted as a viable option? NO
    Are schools encouraged to work together? NO
    Are Catholic school teachers fairly compensated when compared to public schools? NO
    Are many Catholic schools truly Catholic? NO

    Should she be paid that much? NO!

    • Little Red Hen says:

      Even if Mary Grassa O’Neill were successful at all the things you mention, her salary would be unconscionably high, and I don’t know how she can bring herself to accept it.

    • “Catholic Teacher Man”,

      There are no authentically Catholic Schools in the Archdiocese of Boston. The only one in Massachusetts is in the little village of Still River (Worcester Diocese), Immaculate Heart of Mary School, located at the St. Benedict Center and run by the Brothers and Sisters of the Slaves of the Immaculate Heart of Mary (MICM is their suffix). It is independently run from the diocese, and they have one of the oldest continuous Tridentine-only curriculum in the United States. The school day actually begins with the TLM in the chapel.

      • Chris says:

        Chris Whittle,

        I would add the Lancaster, Mass., Trivium School to that (short) list. http://www.triviumschool.com/index.php I have also heard good things about the Nativity Prep in Boston and New Bedford.

      • Catholic Teacher Man says:

        Just because a Church/school does not use the Tridentine Mass does not mean it is not Catholic. The NO is a legitimate expression; subject to abuse yes- but not ‘unreal’. It is possible to have a fully alive and faith filled Catholic school without the Latin Mass. There ain’t many in MA, in spite of the number of and salaries of the Catholic Schools Office, which was the point of my comment.

  4. Time for a change says:

    Still time for a change! If the Cardinal does not follow the Law of the Church we should all write to the Holy Father and ask that he be removed!

    How about it BCI, can you use your blog to get a few hundred thousand signatures?

    • Click on my name, I have a petition to the Holy Father to remove Cardinal Sean on the sidebar on the right. You can’t miss it!

    • Liam says:

      Well, Rome just issued the MP. The Roman way is not the Anglospheric way in terms of expectations of immediate compliance. A way different legal culture.

      • I understand that Rome is five hours ahead and seems take five years for a simple message to get across, but back in 2002, when the Sex Abuse Scandal took place, the media and the public hounded Cardinal Law for reassigning priests every time they did something wrong in the parish.

        Eventually, Law resigned a week before Christmas. Nobody was complaining about six figure salaries and clustering back then on this level.

        These past ten years with Sean O’Malley have been terrible. There are more Canon Law violations than speeding tickets. Most of this is ecclesiastical.

  5. Lynne says:

    Scott Landry is a faithful and orthodox Catholic. The radio show is not the only responsibility in his job (I don’t believe) BUT is he over-paid? Yes…

    No way do I want Martha Coakley to get involved in investigating/prosecuting the Archdiocese of Boston! But we should be writing to Cardinal O’Malley and the papal nuncio.

    • Lynne, Thank you for your comments. In our experience, there are only 3 things that drive action in the Boston Archdiocese under Cardinal O’Malley: avoiding lawsuits, avoiding loss of money, and avoiding bad publicity. Unfortunately, those are largely the things that drive change.

      Though BCI would prefer to avoid involving Martha Coakley, it seems fairly clear that the Boston Archdiocese under Cardinal O’Malley is violating their fiduciary responsibility to be good stewards of donor funds, and that is a violation of both civil law and canon law. Writing to Cardinal O’Malley is a waste of time–he knows what his team is doing and is approving of it. We are asking people to write to everyone who might exert influence on the leadership of the Boston Archdiocese to fix the problems–the Papal Nuncio, and soon the Congregation of Bishops and others in the Vatican. If there is an obvious breach of fiduciary or moral responsibility that the RCAB and Vatican are not acting on, do we sit still and do nothing else? It took an investigation by the media and civil authorities to break open the sexual abuse problem, so is it out of the question that the same might be needed here?

      We understand if you and other readers wish to focus letter-writing campaigns on Cardinal O’Malley and the Papal Nuncio. But, Rome is burning, and we are simply doing all we can here to try and extinguish the bonfire!

      • I agree with BCI here. Breaking civil law is breaking civil law. The Attorney General’s Office has the right to investigate any wrongdoings that take place, and prosecute if necessary.

  6. Lynne says:

    And this blog entry should be posted on Facebook. I’ll be posting it this evening…

  7. Chris says:

    BCI, I question your choice of the Boston Globe as a partner in your effort to clean up the archdiocese. Please don’t make a pact with the devil.

    • Janet Baker says:

      Was it not the Boston Globe that played a key role in finally ending the secrecy of the Church’s sex abuse disaster? I say let the press do what it’s supposed to do (for a change); God can certainly use them.

      • Chris says:

        Janet, I understand your point. But the Boston Globe drives the normalization of same-sex relationships for example (even in the magazine blind date column). I can’t see any good of inviting them into a situation. They will twist and distort. There are no good, unbiased journalists anymore. (I think there used to be a few back in the day).

  8. Stephen says:

    OK so they know the salaries are ridiculous. They do nothing about it and even raise them. Why? They have purchased serious loyalty of those making the salaries. It creates a very strong in group /out group mentality with those in positions of actual power. Critic of the salaries by default are critics of Sean, the diocese – all the wonderful work. All criticism is seen as coupled with envy resulting in loss of credibility. A brilliant strategy.

  9. Stephen says:

    http://www.jihadwatch.org/2013/01/catholic-diocese-capitulates-to-islamic-supremacists-and-leftist-media-cancels-robert-spencer-confer.html
    RCAB meddling in international affairs. What a gutless clown show. I hope Spencer hammers back hard.

  10. teddyballgame says:

    If this weren’t so sad it would be funny. It’s clear Grassa-O’Neill’s wage is way out of line. Gustavason’s wage is just as skewed. Comparable jobs in Fortune 500 companies will range from $130,000 to $190,000. Those jobs involve administration and design of huge employee benefit plans. I worked in that sector and know what Gustavason does at RCAB could be done by a mid level employee earning $70k to $80K per year. Her job is a no brainer, and she is paid $170,000 per annum ?

    By the way, why do these particular salaries need to be competitive. No other salaries at RCAB are “competitive”. Fact is, people around the Archdiocese are largely underpaid and overworked. This is a serious failure of leadership on the part of the Chancellor and serious dereliction of duty on the part of the Cardinal.

  11. Stephen says:

    Brought to you from RCAB, and exposed by BCI

    It is the “Fleecing the flock Scandal”!

  12. Lazarus' Table says:

    If, theoretically, the lay and clerical leadership of the diocese stopped believing in God, would there be any noticeble difference in the way the diocese is run? It’s hard to look at all this and believe that somehow it is giving witness to Jesus. Just what part does Jesus play in all this, apart from being a marketable device?

  13. Jack O'Malley says:

    I don’t know. I just feel that after reading this ongoing exposé from BCI, and in light of the Sixth Bloody Commandment of the “Church”, I really feel the urge to attend a masonic novus ordo seclorum mass in the near future and thrust a C note or two into the collection plate. Or maybe even swish on over to Presbyter Unni’s “parish” and assist the homoerotic dating agency to flourish.

    I am a good and faithful Catholic and a sheep willing to be fleeced and turned into a mutton chop at the behest of Cardinal Connors. Oops. I meant Cardinal O’Malley. I sometimes forget who pretends to be the boss at the “pastoral centre”.

    Still, I am deathly, yes, deathly (‘m sure I really mean “deathly”), afraid of losing my eternal soul because I have not learned Kreyol to understand the inspired liturgical words of our beloved shepherd and “prince of the church” O’Malley and placed my tithe in the suckers’ basket to pay off the queer scandal and, most especially, my debt to Mary La Grassa for her brilliant academic qualifications and extraordinary educative talents, not to mention her incomparable, truly incomparable, administrative skills. A thaumaturge not only of bureaucratic efficiency but elegance as well. How does a mere mortal attain such divinely laudable virtue? We who teeter on the edge of the abyss can only wonder in obsequious admiration. Does she not cause the archdiocesan sun to dance at her mere command? It’s good to have a meteorologist at the pastoral centre. And such a bargain she is! Nu, who’s complaining?

    As to lovely Beirne and Donilon and Landry, I just wish I had another grand or two to help them in their cringing poverty. Such chancery virtuosi we pew puppies are not fit to gaze upon. The Transfiguration pales in comparison with the luminaries of the pastoral centre. Connors and O’Malley and La Grassa! Shall we make here three tabernacles?

    BTW, Lord Connors is way overpaid for his mediocre talents running an hawker agency. Why doesn’t he take some of his sumptuous emolument and repair the Bells of St. Mary’s in Newton. Where by the gracious leave of that selfsame prince of the church, Cardinal O’Malley, a.k.a. Cardinal Seán, Brother of the Sun and Sister of the Moon, unrepentant unapologetic unrestorer of the Church of Christ which has fallen into ruin, the True Mass languishes in the peripheral precincts of the archdiocese, ever since his cardinalitial anathema suppressed Heilige Dreifaltigkeit.

    By the Most Precious Blood of the Redeemer, may God in his infinite justice and superabundant mercy put this incorrigibly corrupt “archdiocese” out of it temporal misery and consign it unto the eternal steaming and reeking cesspit of Gehenna.

  14. teddyballgame says:

    Jack O’Malley is brilliant!!!!

  15. Chris says:

    Jack O’Malley was clearly born in the wrong time. He’s Old Testament for sure!

  16. Jack O'Malley says:

    @teddyballgame: thanks for the compliment. But I don’t claim to be brilliant by a long shot, just disgusted with our local “prince of the Church”.

    I don’t accept excuses. Blame the boss. Cardinal O’Malley. The buck stops with him. More appropriately, the Cross stops with him. Got it, Cardinal “first name”?

    I’d throw Connors and La Grassa and lovely Beirne and the rest of the satanic Sanhedrin out. I could run the show on 10% of the budget those bastards spend.

    Maybe I’ll write to Papa Ratzi and have myself appointed archbishop. Sort of like Synesius. I’m not giving up my wife and / or mistress. But I’d whip this corrupt bunch into shape in a month. Mary La Grassa would be dumpster diving for scraps after I confiscated her stolen pension. And Connors would be excommunicated. If Ed Peters could not find a canon, I’d invite Connors to a personal interview, (which he would attend under pain of excommunication), and give him a theological and magisterial elenchus which he would be predestined to fail. Love that Augustine guy. Or maybe that was Calvin? In any event, he’d be looking for a queer-loving Episcopalian priestess for cheap purported salvation the next day.

    @Chris: If I’m OT then maybe I should convert to Judaism. Maybe I’d be a good rabbi. Do Jewish women go to confession? Mmmm. Good way to find a fallen woman…… Kidding, kidding. Really. I really am. Nu, so maybe I’m not …. :-)

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