Superintendent’s Salary Explained: Part 2

May 10, 2011

We had some WordPress technical issues with display of our most recent post, so before reading today, be sure to check out our previous post, Schools Superintendent Salary Explained: Part 1.

In our last post, we shared the response to an Ethicpoint whistleblower complaint about the $325K/year compensation of Mary Grassa O’Neill.  The person who filed the report got a response back via Ethicspoint saying i) the Cardinal was within his authority to appoint her and pay commensurate with her experience in order to lure her from Harvard to the Archdiocese, and ii) A Compensation Committee was forming and planned to hire a consultant to help them sort through the situation and issue a report with the next fiscal year annual report a year from now.

The comments from readers were so insightful that you really need to read them all.  We will re-post selected ones separately, but for today we bring you Part 2 of the saga–the follow-up report submitted by the person who filed the first one and was “livid” over the indifferent response.

ETHICSPOINT REPORT #2

4/13/2011

Issue Type

Donor Stewardship

Please identify the person(s) engaged in this behavior:

Jim McDonough –  Chancellor
Cardinal O’Malley – Archbishop
George Massaro – Chair, Audit Committee

Do you suspect or know that a supervisor or management is involved?

Yes

If yes, then who?

Cardinal O’Malley
Finance Council, including Audit Commitee

Is management aware of this problem?
Yes

What is the general nature of this matter?
irresponsible  stewardship of the resources of the archdiocese

Where did this incident or violation occur?
the incident started in 2008, but I also wish to report the apparent corruption of the Ethicspoint  process, which occurred with my report filed 3/27/2011

Details

I previously submitted a report complaining about the excessive compensation for Mary Grassa O’Neill. I gave evidence of how her compensation of $325k/year is well in excess of what is paid to other public school superintendents (e.g. $50-75K more than Boston, New York, Los Angeles, Chicago). It is also at least $100K-$150k more than any other Catholic archdiocese pays for a comparable role.

Because Mary Grassa O’Neill is paid so far in excess of what other Catholic archdioceses pay for this role and public school systems pay for someone of her  qualification level, this objectively constitutes a violation of the Code of Conduct which 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.”

Your explanation and justification for her salary suggests very strongly that the Ethicspoint process in the Archdiocese of Boston is already corrupted.

The compensation package offered to Ms. O’Neill is NOT commensurate with her experience if she were employed by a major metropolitan public school system or Catholic archdiocese.

It IS in violation of the Archdiocesan policy concerning responsible stewardship of resources.

For the Compensation Commitee to now spend money engaging a private consulting firm to help assess compensation levels is in violation of the policy regarding responsible stewardship of resources. Why can’t Jim M or Carol G in HR just call 5 other dioceses and ask what they are paying for these roles, and what kinds of background the executives have?

I am most disappointed in your response. It suggests this new Ethicspoint whistleblower process is already rigged and corrupt.

ETHICSPOINT-FACILLITATED RESPONSE FROM THE ARCHDIOCESE

4/20/2011 3:07 PM – Thank you for filling your report. We take all concerns seriously and have completed a review of this issue. Unfortunately we are unable tgo  inform you of the specifics of our investigation; however, please know that your issue has been addressed.

– – – – – – – – – – – – – – – – – – – – – – – – – – –

BCI is almost speechless about what happened.  First the archdiocese responded dismissing the concern, but saying a Compensation Committee was being formed and would hire a consultant who would issue a report. (That means the 2011 annual report that would be issued a year from now).  Then the complaintant was sufficiently upset that they filed a second report reiterating that the excessive salary violates the Archdiocesan policy concerning responsible stewardship of resources and complaining that the anti-corruption whistleblower process was itself corrupt.  That resulted in a response back that said the “issue has been addressed.”

Only problem is that the complaintant tells BCI they still do not know which “issue has been addressed?” Is it Mary Grassa O’Neill’s salary and how her compensation is in conflict with responsible stewardship of resources?  Is it the spending of money on a consultant to solve the problem they should be able to solve themselves as responsible managers and stewards of resources?  Is it the corruption in the anti-corruption whistleblower process?

Beyond the question “Is Archdiocesean Anti-Corruption Effort Corrupted and Conflicted?” BCI raised last week and which this complaintant also raised, the whole approach taken with compensation in the past and going forward seems like it needs an overhaul.  As a starting point, every member of the Compensation Committee should read this common sense comment on our last post from Deacon A.J. Constantino.

If someone on the Archdicoesan Cabinet, the Compensation Committee or the Finance Council wants to do the right thing, could you send smoke signals, drop us an email, or otherwise indicate you get the message?  We are just trying to help here by airing these concerns from faithful Catholics, but it seems like no one gets it at 66 Brooks Drive.

Hello?

Anyone there?

Hello?  Hello?


Questionable Composition of Compensation Committee

May 6, 2011

We wanted to wrap-up this week with more of the myths and misconceptions about BCI, but are preempting that post to share the latest from the archdiocese regarding the new Finance Council Compensation Committee, whose membership was finally posted this week.

A key goal of the committee is to review the six-figure compensation of lay cabinet executives–several of whom are multi-millionaires–and a quick glance at the first two names listed on the Compensation Committee membership list reveals that they themselves are multi-millionaire businessmen.

The first thing that came to mind after learning this was the Homer Simpson catchphrase, “”D’oh!

As most people know by now, the Archdiocese of Boston pays certain lay executives six-figure salaries that are objectively excessive for the Catholic Church to be paying.

We know they are objectively excessive because we contacted several other archdioceses and asked them how Boston lay executive salaries compared to what they were paying. We also looked at salaries for roughly comparable private sector jobs in the case of the superintendent of schools, who is paid $325,000 in the Boston Archdiocese.  With 1/3 of parishes in the red, parishes being “taxed” to pay Central Ministries expenses, the Catholic Appeal down $1.5M from the prior year, and lay and clergy pension plans underfunded by hundreds of millions of dollars, a reasonable person would think the archdiocese would work hard to contain salary expenses.

Not really.

Whether it was due to prodding by BCI or it was going to happen on its own, the Finance Council voted on November 4, 2010 to form a “Compensation Committee” to review lay executive compensation.  We did not think it was such a great idea at the time, as discussed in our December 9 post, Finance Council Top Ethical Concerns: #4: Compensation Committee.   It makes the Finance Council even more into something analogous to a corporate “Board of Directors” (which it is not) and the archdiocese should just conduct sound management and compensation practices as a matter of course, benchmarking against other dioceses as was done in the past.

In looking at the membership of the new committee and what we know of their plans, it appears that a lot of the concerns we  raised back in December in Finance Council Top Ethical Concerns: #4: Compensation Committee have been ignored, and for the sake of the success of this effort, we hope the archdiocese reconsiders and makes adjustments.

Based on an Ethicspoint response that reader, “Mary” forwarded to us suggesting the committee was getting ready to roll, we went to the publicly accessible Finance Council page and noted the membership of the Compensation Committee:

  • Paul W. Sandman, Esquire, Chair; Board of Directors, PDL BioPharma
  • Brian Concannon; President and CEO, Haemonetics Corporation
  • John H. McCarthy, CPA, Vice Chair;  Senior Vice-President for Administration and Finance, Northeastern University
  • Reverend Michael Drea, Pastor, St. Paul Parish, Cambridge
  • Reverend Jim Ronan  Pastor, St. Mary – St. Catherine of Siena Parish, Boston
  • Mary L. Ryan; CEO, Thompson Steel Company
  • Leo Sullivan; Vice President of Human Resources, Boston College

In our December post, we suggested that an effort to review compensation would be best “led by someone whose own annual compensation is closer to the level that people who work full-time for the Catholic Church are paid.”  A simple Google search on the first two names revealed that both are multi-millionaires.

  • Paul Sandman: Forbes reports that in his present role as Chair of the Board of PDL BioPharma, he is paid $166,000. In his prior role as Senior Vice President and General Counsel at Boston Scientific, the 2003 proxy (found here) reports that his 2003 salary and bonus totaled $740,000.  The 2003 proxy reports that he also held 540,060 shares of stock, whose value at the time based on the stock price of $32/share was approximately $17.5 million.  This shareholder lawsuit filed against Boston Scientific which was dismissed said that during the period covered by the class action, Sandman sold over 54% of the equity he held in Boston Scientific securities…generating more than $24 million from these transactions.”
  • Brian Concannon: Forbes reports that in his present role as President and CEO of Haemonetics, his 2010 compensation (salary, bonus, stock) was $3.2 million.

BCI does not begrudge people for their success and for earning a lot of money.  But for an effort intended to determine if lay executives making $150K-$325K/year are overpaid, having multi-millionaires assessing the compensation of other multi-millionaires gives the appearance of the “fox guarding the chicken coop.”   Is it not possible to find people for the committee who themselves are not CEOs who have been paid millions of dollars a year?  Well intentioned as they may be, how can these corporate CEOs and executives, themselves highly compensated, not have a bias towards the corporate strategy of paying whatever it takes to recruit top talent, which is very different from a public charity or Church-oriented strategy of recruiting competent, qualified people who believe strongly in the mission of the Catholic Church and will work for what the Church can afford to pay them? Why not include an HR person from another Northeast diocese such as Fall River, Hartford or New York on the committee?  Why not have one or two Catholic HR people from the private sector on the committee?  Why not include someone like Deacon A.J. Constantino, whose insightful comments here should have made him an obvious candidate for the committee?

In our December post, we also suggested that placing Jack McCarthy on the committee could create what appears to be a conflict of interest:

Jack McCarthy is already head of the Steering Committee and, coincidentally, just so happens to be the next-door neighbor in Hingham to the newly-hired Development Chief, so he has a perceived conflict of interest if her compensation is to be reviewed.  (He was also a member of the “sham search” committee that was never allowed to interview candidates).

BCI has sent a number of emails to Jack McCarthy regarding the deception and ethical corruption in the Boston Archdiocese and he has never responded.

Regarding the other members of the committee, we are not ignoring the names or saying there is anything problematic with their membership.We are not making personal judgments about the people on the committee. We are simply saying the first few names on the list caught our attention, and create a perception that the committee is likely to fail before it has even started.

We close today with an excerpt from A.J. Constantino’s comments on our December post:

Let’s get to basics, each “lay executive employee “should be clearly defined by a Job Description; Objectives, Accountabilities and Measurements.

Human Resources should be developing the Job Description with the hiring manager; while the objectives, accountabilities and measurements should be set by the manager and the employee and placed on file with HR.

The question is does the RCAB have these “Standard Operating Procedures” in place?

Next: there are countless FREE resources available to develop compensation packages =- it’s not a mystery!

I have worked in several large companies, where the Presidents/CEOS have been anxious to use outside consultants, after paying large fees, we most often learned that no one knows our business better than we did and in the end “self-determination” was best.

From the “outside looking in”, it appears that “lay executive employee” salaries are disporportionate to the overall RCAB budget…

For those who may be bit put off my analysis, it’s a business world prospective, NOT a Church world perspective. In my opinion, a $100K-$150K salary for a “lay executive employee “ for the RCAB is just–with, once again, in my opinion, one exception, “in house” Legal Counsel.

BCI recognizes the Archdiocese for taking some steps to address the compensation problem. But we think the Compensation Committee concept, though no doubt well-intentioned, is not the right way to solve this problem. Apparently, they are also now off to hire an expensive outside consultant as BCI and A.J. cautioned against.  As described above and in our December post, there are better, less expensive ways to solve this problem.

What do you think?


Is Archdiocesean Anti-Corruption Effort Corrupted and Conflicted?

May 4, 2011

On March 25, the archdiocese released a Code of Conduct policy and anonymous whistleblower process using a 3rd-party tool, Ethicspoint, whereby anyone can file a report of a violation of the Code of Conduct and have it investigated.  The policy itself and the process outlined for the archdiocese to investigate claims raised a number of questions that we did not have the time to bring up then, but now that a number of readers have submitted claims and received responses, we feel we need to open that can of worms.

Below, you will find an example of a claim recently submitted and the response, which left a BCI reader sufficiently dissatisfied that they just sent it our way. It is the 4th complaint BCI has received about the program. If you have tried submitting claims and got back an unsatisfactory response, please email it to us.

Archdiocesan auditors had recommended the archdiocese implement an anonymous whistleblower program for years, and BCI reminded the archdiocese about this for a number of months.  But from our first post on the topic through our most recent one in January, Whistleblower Policy: Progress and Problems, we raised concerns about weak leadership and the proposed plan of routing claims to the very people responsible for the problems, or to no one.  Then there are the ambiguities about the policy itself as currently worded.  Little more than a month into the program, it seems that the chickens have come home to roost. The program that was time-consuming for the archdiocese to develop and implement may already have proven sufficiently ambigious and subject to interpretation that it is ineffective.

First, here is the Ethicspoint website for the Boston Archdiocese where you can read the Code of Conduct Policy and/or file a claim. Claims can be filed in these categories:

  • Financial, Auditing, Accounting and Stewardship Misconduct: Accounting, Auditing and Internal Financial Controls; Abuse of or Fraud with Benefits; Donor Stewardship; Embezzlement; Falsification of Contracts, Reports or Records; Theft (Larceny, Burglary, Robbery); Time Abuse
  • Archdiocesan Employee Code of Conduct Violation or Misconduct: Conflict of Interest, Data Privacy, Disclosure of Confidential Information, Discrimination or Harassment, Gifts and Entertainment, Improper Lobbying or Political Contribution, Misconduct or Inappropriate Behavior, Retaliation, Sabotage or Vandalism, Substance Abuse
  • Workplace Safety: Unsafe Working Conditions

The Reporting Process is described in this document, which says, “Whether made through the Archdiocesan website or via the dedicated toll-free telephone hotline, all reports…will be given careful attention by the appropriate Archdiocesan Vicar or Director. All reports submitted will be supervised by the Audit Committee of the Archdiocese of Boston Finance Council. If a submitted report references the Vicar or Director who is responsible for investigating in the area of concern of your report then they will be omitted from the reporting process.”

Below is an example of a recently submitted report and the response.

Report Submitted

Issue Type
Misconduct or Inappropriate Behavior

Please identify the person(s) engaged in this behavior:
Jack Connors – Finance Council member, Chair of Campaign for Catholic Schools

Do you suspect or know that a supervisor or management is involved?
Yes

If yes, then who?
Cardinal Sean P. O’Malley

Is management aware of this problem?
Yes

What is the general nature of this matter?
Connors is violating the Code of Conduct by hosting fund-raisers for pro-abortion political candidates and by serving on the Board of Partners Healthcare, which provides abortions.

Where did this incident or violation occur?
multiple times. see below

How long do you think this problem has been going on?
More than a year

How did you become aware of this violation?
Other

If other, how?
I read it in the newspapers all the time

Details
The Code of Conduct says “The public and private conduct of Church Personnel can be a source of inspiration and motivation, but it can also scandalize and undermine the faith of the people that are served.”

“Church personnel who disregard or violate this code will be subject to remedial action. This action can take several forms, from an oral or written warning to removal and termination of employment or services.”

Cardinal Sean O’Malley, in a 2007 interview with the Boston Globe: acknowledging that Catholic voters in Massachusetts generally support Democratic candidates who are in favor of abortion rights, said, “I think that, at times, it borders on scandal as far as I’m concerned.”
http://www.boston.com/news/nation/articles/2007/11/15/omalley_draws_line_with_democrats/

This article in the Boston Herald says Jack is hosting a fundraiser at his home for the most pro-abortion President in our country’s history.

http://www.bostonherald.com/news/columnists/view/2011_0429a_smile_worth_10g_yes_you_can_pay_to_pal_with_prez/srvc=home&position=4

Here we have Jack Connors hosting pro-abortion politician, Joe Biden for a “friend-raiser.”
http://www.boston.com/news/politics/politicalintelligence/2011/03/biden_to_visit_1.html

Jack is Chairman of Partners Healthcare, whose Brigham and Women’s Hospital profits from performing 4,300 abortions every year (3,600 first-trimester and 570 second-trimester).

http://www.partnersobgynres.org/programinformation.asp

Jack was the Co-Chair of the 2004 Democratic National Convention that nominated Sen. John Kerry for president. Sen. Kerry is pro-abortion.

http://www.cdc.gov/mmwr/preview/mmwrhtml/ss6001a1.htm?s_cid=ss6001a1_w

Jack publicly endorsed Martha Coakley for U.S. Senate.
http://www.boston.com/news/local/massachusetts/articles/2009/11/22/yoon_pushes_proposed_ordinance_on_term_limits_for_mayor/?page=2
Martha Coakely is pro-abortion. In a January 2010 radio interview, when asked about conscience rights and religious freedom for Catholic healthcare workers who believe what the Pope teaches, Coakley responded, “You can have religious freedom but you probably shouldn’t work in the emergency room.”
http://www.washingtontimes.com/weblogs/watercooler/2010/jan/14/martha-coakley-devout-catholics-probably-shouldnt-/

The Code of Conduct says Connors, by being a Finance Council member and Chair of the Campaign for Catholic Schools, qualifies as “Church Personnel.” His private conduct supporting pro-abortion politicians is a source of scandal, according to Cardinal O’Malley himself, and undermines the faith of the people that are served. It would seem to me that remedial action needs to be taken. If Connors does not cancel the upcoming Obama fundraiser, then I believe based on the Code of Conduct, he needs to be removed from any service to the Archdiocese of Boston.

Here is the Ethicspoint Response:

Mr. Connors is not representing the Archdiocese of  Boston at this event. The Code of Conduct does not bar Church Personnel or Volunteers from attending or hosting fund raising events. There is no violation of the Code of Conduct.

#   #   #   #

The reader commented the following to BCI,

The policy clearly states “Church Personnel will conduct themselves in a manner that is consistent with the teachings of the Roman Catholic Church as enunciated by the Holy Father and the Bishops in communion with him.  More specifically, Church Personnel shall, in all such matter, accept, rely upon, and defer to the teaching authority of the Archbishop in all matters of faith and morals.”  Does someone in the archdiocese not realize that abortion is against the teachings of the Church?!!  They write a Code of Conduct policy that says private conduct can be a source of scandal and undermine the faith of people, but when I raise a claim of two instances of private conduct that are diametrically opposed to the teachings of the Church and scandalous, one of which our archbishop himself said publicly borders on scandal, they respond saying there is no violation. Who makes the decision that Jack Connors’ behavior is not a source of scandal and thereby a violation of the policy?  How do we know that person or those persons who reviewed my claim and responded themselves agree with the teachings of the Church?  The policy is clearly bogus. There is not even a way for me to respond to the bogus decision. BCI needs to expose that the program is corrupt.

This gets back to something that reader, “Objective Observer” objectively observed in a comment right after the policy was issued:

1. VERY POORLY DRAFTED — overly broad and vague; standards are wildly subjective; open to completely inconsistent enforcement; flunks the
“whim” test; which makes it…

2. UNENFORCEABLE… The standard is completely subjective —so need not be applied consistently. In other words, the circumstances of violation in the Code are very broad and vague, and the enforcement is completely subjective — some “Church personnel” (the list includes everyone except your cat) could be fired AND sued, others could be left to do as they please.

After looking at several emails forwarded to us by people who have filed what BCI feels are valid claims, we concur that both the policy and the program are flawed, conflicted, and perhaps even corrupted.

The intention of a Code of Conduct and an anonymous whistleblower policy is good. But this particular policy as worded and the implementation need work. Pastors are going to have to complain about this.

What do you think?

ps. For the moment, if you find the response to the claim above problematic, we encourage readers to submit their own Ethicspoint reports on this same issue (or other issues).  You can submit anonymously via the Ethicspoint website, or you can call 1-866-491-5283.  The only way we believe this flawed policy and program be made right is for people like you to weigh in on it. Keep us posted how you make out.


How to Save $2 Million Without Really Trying: Part 2

January 11, 2011

In our last post, How to Save $2 Million Annually Without Really Trying: Part 1, we shared how the Archdiocese of Boston could readily save in the range of  $1,150,000 to $1,250,000 a year–starting immediately–by reducing excessive salaries of the top 10 employees to $150,000.  This would also avoid possible state or federal penalties for breach of fiduciary responsibility, and a possible $250,000 IRS penalty.

Today we share how the archdiocese could save as much as another $850,000 per year by ending the 5 vigils at closed parishes that have exhausted all of their canonical and legal appeals.

Step 2: End Vigils at Occupied Churches

The second part of our waste reduction program calls for ending the vigils at the still-occupied parishes who have exhausted all of their appeals.  This can be done very simply by allowing people to exit the buildings but refusing to allow new people to enter the buildings. As we reported more than 3 months ago (on October 9) in Vigil Vigilance, we know from the annual report by the archdiocese that the cost to maintain all closed church buildings in 2009 was $1.5 million. Our sources indicate that maintaining approximately 45 closed and unoccupied churches to police/emergency standards is costing about 45% of that total, or around $700K/year.  But maintaining 5 occupied buildings to residential standards—for which church buildings were never intended—has been much more costly, as these buildings need to be heated, insured, and plowed in the winter, with maintenance people often on-call to respond to any reported problems. That is estimated to still be costing around $850,000 per year of that $1,500,000.

As we explained in “Vigil Vigilance”, the vigils have gone on for six years! By our estimate the vigils have cost somewhere around $5 million in donor funds, and they have gone on so long largely because of one reason: Cardinal O’Malley accepted the flawed advice of Fr. Bryan Hehir back in the 2004-05 timeframe instead of listening to financial, insurance, legal and property management experts. As we reported in October, back in 2004-05, Cardinal O’Malley was advised by pastors, lawyers, insurance people, real estate and property management people and canon lawyers to end the vigils through a structured conflict resolution process that included requiring protesters to leave immediately. That is how the archdiocese prevented all the attempted vigils after St. Jeremiah in Framingham started in 2005, and it is a civilized, non-confrontational, responsible way to deal with them.  But Fr. Hehir and Ann Carter of Rasky Baerlein wanted to avoid a possible PR fiasco (which would have lasted only a few days) and undid the unanimous recommendation of those experts.  The Cardinal accepted their flawed  advice, and  the result has now lasted six years–and continues to cost the archdiocese millions of dollars.

(Note to Cardinal O’Malley, Fr. Hehir opened a talk last October at BC High with the self-deprecating comment, “I can write an article, but can’t run a 3-car funeral.”  Catholic Charities of Boston under his leadership also saw annual operating deficits totaling $5 million between 2005-2007  causing Tiziana Dearing in 2008 to publicly say when she took over for Fr. Hehir, “I am trying to do a financial turnaround.”  Fr. Hehir was also the one who advised in favor of the salaries for Terry Donilon, Jim McDonough, and Mary Grassa O’Neill as well.  Here is an idea to consider: Maybe you just might want to find a different adviser to listen to?  Or, when you get advice from Fr. Hehir, do exactly the opposite of what he advises.  We digress…)

Regarding the vigils, we will repeat what we said in October, if anyone is still deluded by Fr. Hehir into thinking that this is a time for dialogue, we reiterate that this is the wrong approach. It is time to simply say anyone inside is free to stay, but no one and nothing may enter the building now. Maybe if the  archdiocese starts charging Fr. Hehir and Rasky Baerlein the cost of maintaining the church properties where the vigils continue, we can all see how long it takes before their advice finally changes and the vigils abruptly end.

Bottom line: end the vigils and start saving an estimated $850,000 per year

So there it is–two steps to saving $2 million annually.  First, reduce excessive salaries to $150K/year and save $1.15-1.25M.  Second, end the vigils and save $850K.  That $2 million could otherwise be used to shore-up the lay or clergy pension funds and/or other critical ministry needs.  On top of that, as one commenter observed from a recent parish meeting, “When they [Archdiocesan Cabinet leaders] are paid more like we’re paid, people will start giving again.”

If the Chancellor would publish the 2011 central ministries budget as part of the Improved Financial Relationship Model (IFRM) effort–given that we are more than half-way through the fiscal year– we can probably find another $1+ million to save on top of this, but we will just start with this $2M for now.

Nearly five months have passed since this blog started raising the issue of excessive six-figure salaries and more than two months have passed since the Finance Council agreed on Nov. 4 to create a Compensation Committee.  But nothing has actually happened to address the problem of wasteful spending in this area and there are no results. Apparently no one views saving millions of dollars/year in donor contributions from being almost literally poured down the drain today as nearly as pressing an issue to discuss compared to, say, other issues like reducing the cost of the monthly mailing to priests by a few hundred dollars a month (or discussing how to stop the BCI blog from blowing the whistle on the waste 4-5 years after auditors recommended the RCAB implement an anonymous whistleblower policy).

Will the Presbyteral Council take up the matters of excessive spending and how to save $2 million a year with great urgency at their meeting this Thursday–and take decisive action?  If and when the topic of “the blog” comes up at the Presbyteral Council meeting, will the Vicar General hand-wave and once again say, “We tried reaching out to them (once)”? Will the main concern be how to prevent the Boston Catholic Insider blog from publishing and maintaining an open form for discussing the truth (whose publication will help the archdiocese continue the good works of the Catholic Church in Boston), instead of how to simply operate the business of the archdiocese with integrity and fiscal prudence (which will in turn, cut off the “air supply” of content to the blog)?  Will the Presbyteral Council finally discuss the underlying fiscal mismanagement issues and the growing trust and management concerns about the current Chancellor?  Will pastors boldly stand up and declare they will stop sending money to feed Corporation Sole’s excessive salary and wasteful spending appetite until these concerns are addressed? Will the Council discuss the flawed whistleblower policy under consideration that would send anonymous claims right back to the senior cabinet officials (such as the Chancellor) under whom the infractions may have been committed, instead of ensuring the claim are investigated independently?  When he is back from his latest trip to Dublin, will the Cardinal exercise episcopal leadership and order that cabinet-level salaries be slashed instead of waiting six months for yet another “committee” to weigh in?  Will the Cardinal at some point soon also share some sort of meaningful vision for the Archdiocese of Boston, as well as separately for the Catholic schools?  Or, as we asked yesterday,  will the powers-that-be continue “fiddling while Rome burns” as Chancellor McDonough keeps twiddling his Blackberry?

We have described in two blog posts how an estimated $2 million a year in donor funds is being wasted today. This would objectively represent a breach of fiduciary responsibility.  Does anyone in the Boston archdiocesan leadership care enough about this matter to respond?

Hello?  Hello?


How to Save $2 Million Annually Without Really Trying: Part 1

January 9, 2011

For all of the pressure put on pastors (and thus on parishioners) to support the annual Catholic Appeal, for all of the pension and clergy retirement fund cuts, for all of the layoffs of dedicated church workers and all the ministry cuts that have supposedly been “necessary” to save money under the current Chancellor, what if someone could provide evidence that the Archdiocese was basically wasting $2 million/year or more?  Would anyone responsible for that waste get fired? (Or would they get retained and/or promoted)?  What if there was a way to save $2 million a year while maintaining all of the services currently provided?  What could be done with that $2 million?

We see a way to save at least $2 million annually from the Archdiocese of Boston central administration expenditures–if not more—but the people at the very top of the hierarchical food-chain at the Pastoral Center in a position to act on this –and on the Presbyteral Council and Finance Council–are simply not doing anything about it.  The blog and our readers are frankly getting sick and tired of the ongoing fiscal mismanagement and squandering of assets.

In our last post, “Is Boston Archdiocese Violating the Law?we reported on how the excessive salaries doled out by the Archdiocese of Boston represent a breach of fiduciary responsibility and could also set the archdiocese up for fines or other penalties by the government.  “Objective Observer” objectively observed and asked:

“Is there no one else who could do as good or better job as chancellor, as benefit trust president, or as school superintendent? Their combined compensation and benefits comes to nearly $1 million for just 3 people….So shoo them out the door with all the usual accolades, find three people at about $150,000 each to do their jobs. Now you are at $450,000 for salary and about another $150,000 for benefits (new hires can’t start in the pension plan). Put the other $400,000 you’re not spending on those three positions into the pension trust to raise the total available every year, and sing all the way to the bank.

While you’re at it, place a $150,000 cap on the top ten salaries (think about those lawyers, layers of finance poobahs, etc.).

We did the math, and are pleased to offer you the exclusive Boston Catholic Insider plan for cutting $2 million in two simple steps.  Here is the quick explanation of how to save the money.

Step 1: Reduce Excessive Spending on Top Ten Salaries

First, take the top 10 salaried employees and reduce their compensation to no more than $150K/year. These are people who make anywhere from $166K/year up to $325K/year.  We have listed most of the names and salaries before, but with recent changes, as best as we can determine, the Top 10 names now include the following people:

  • Terry Donilon, Secretary for Communications
  • Kathleen Driscoll, Secretary for Institutional Advancement
  • Mary Flynn Myers, Vice President of Development
  • Mary Grassa O’Neill, Secretary for Education, Superintendent of Schools (who, on top of her $325K salary from the RCAB, coincidentally, also collects a state pension of at least $75K/year from her 30 years working for the public schools in Boston and Milton)
  • Scot Landry, Secretary for Catholic Media
  • Beirne Lovely, General Counsel
  • Jim McDonough, Chancellor
  • Glenn Matera, Director of Finance
  • John Straub, Executive Director of Finance and Operations for Central Ministries
  • Jim Walsh, Assistant Superintendent of Schools for Administration and Finance

Not all of their salaries are yet published in reports, but we figure these 10 people are costing the archdiocese about $2.9-$3M in salaries and benefits (e.g. health, dental, life, disability and pension contributions).  U.S. government statistics say the median household income in Boston is around $55K/year and in Massachusetts as a whole it is $64K/year, so anyone making $150K/year would be earning nearly 3 times more than the median household income in Boston and 2.5 times the median household income in Massachusetts. (As part of this salary adjustment, the archdiocese should also reduce the paygrade/salary of the lead benefits administrator, Carol Gustavson, from $150K/year to around half that amount–which is what a benefits administration position should be paid in a Catholic diocese).

We estimate this cap of $150K/year would save at least $900-$925K in salaries alone (if not $1M+, when you also adjust down salaries of direct reports), and if we allow 25% for benefits, that is another $225-250K, for a total of about $1.15 to $1.25 million in savings. If individual secretariats can raise money to pay salaries above $150K/year with the full knowledge and support of their donors (or if the likes of “Jack and Jim” want to open their own checkbooks to fund higher salaries), that is fine.  But, anyone else not willing to accept this level of compensation would be encouraged to pursue employment elsewhere.  This salary reduction would also avoid the potential IRS penalty of 25% of the excessive compensation, or about $250K in potential penalties.  (Which budget would the Chancellor take the IRS penalty from?)

Bottom line: annual savings of $1,150,000 to $1,250,000, starting immediately, plus avoidance of a possible $250,000 IRS penalty

How many donors keeping their wallets closed in the 2010 appeal will it take for the archdiocese to do something?  Will the Presbyteral Council and Finance Council finally take up this matter with great urgency and take action?  Will pastors “just say no” and stop sending money to feed Corporation Sole’s voracious spending appetite until this is addressed?  Will the Cardinal finally exercise episcopal leadership and simply order that cabinet-level salaries be slashed?  Or will Chancellor McDonough keep twiddling his Blackberry trackball and the powers-that-be continue “fiddling while Rome burns”?

Stay tuned for our next exciting Part 2 episode in “How to Save $2 Million Without Really Trying.”  You will also learn what YOU can do to ensure your voice is heard about this ongoing squandering of archdiocesan assets and the breach of fiduciary responsibility.

Meanwhile, if you are concerned about wasteful spending and know someone who is still donating to the Annual Appeal, click on “Leave a comment” and then click on the “email” graphic to send a copy of this blog post to them.


Is Boston Archdiocese Violating the Law?

January 7, 2011

For months now, we have been told by readers they are rather certain the Archdiocese of Boston has been violating the law in ways that could make the archdiocese subject to any of a variety of civil charges or fines.  The excessive salaries we have been reporting on which represent a breach in fiduciary responsibility, and now the manner in which the archdiocese is handling the freezing of the lay pension plan, both raise significant enough questions that we feel this merits urgent attention by those legally expert in such matters, as well as the Presbyteral Council, Finance Council, and College of Consultors.

In yesterday’s post, Catholic School Questions, the comments revealed how the archdiocese is implying to employees that their pension fund might not be there some day so as to encourage them to take a lump sum pension fund payment now.  Beyond the troubling ethical implications, on a legal basis, doing this could leave the RCAB open to sanctions under state and federal regulations. We will take this whole matter up in a separate post, but for now you can share your thoughts on that issue via comments on that post or this one.

Excessive salaries is a whole different issue which we bring to a new level in our coverage today based on the legal consequences many readers may have not been aware of.

In 2004, the Internal Revenue Service announced a new enforcement effort to identify and halt abuses by tax-exempt organizations that pay excessive compensation and benefits to their officers and other insiders.

Could the Boston Archdiocese be subject to fines or loss of their tax-exempt status because of excessive compensation?  The $325,000 annual salary of Schools Superintendent Mary Grassa O’Neill remains one of several glaring examples that could trigger government fines or sanctions.  Read on.

“We are concerned that some charities and private foundations are abusing their tax-exempt status by paying exorbitant compensation to their officers and others,” said Mark W. Everson, then-Commissioner of the Internal Revenue Service. (The current commissioner is  Douglas Shulman)

This particular enforcement effort lasted about a year.  According to this IRS report , twenty-five (25) of the organization examinations resulted in proposed or assessed excise taxes aggregating in excess of $21 million against 40 persons or organization managers. Among the issues giving rise to these assessments was “excessive salary and incentive compensation.”

If the IRS were to get wind of the current pay practices of the Boston Archdiocese for executive cabinet members, we are honestly not sure what would happen.

This report on the IRS effort says the following:

“There is no bright-line rule defining “reasonable” compensation. The IRS has indicated that reasonable compensation is measured with reference to the amount that would ordinarily be paid for comparable services by comparable enterprises under comparable circumstances.”  Fines are 25% of the part of compensation deemed “excess” plus an excise tax of 10% to the organization manager.  The report also says, “Finally, if the IRS determines that a nonprofit organization pays “excessive” compensation to an employee, it could revoke the nonprofit’s Section 501(c)(3) tax-exempt status on the basis that the payment of excessive compensation violates the prohibition against the use of nonprofit assets to benefit private individuals.”  We are not making this up.  Click on the image to see for yourself.

The report, “Wrongdoing by Officers and Directors of Charities: A Survey of Press Reports 1995-2002″ by the Hauser Center for Non-Profit Organizations at the Kennedy School of Government (where  the most trusted advisor to Cardinal O’Malley on everything, Fr. Bryan Hehir, works and collects his six-figure salary) looked at allegations of criminal and civil wrongdoing by officers and directors of charitable organizations. Of the 152 incidents found, 104 entailed criminal activity, 54 involved breaches of fiduciary responsibility (the duties of loyalty and prudence) – self-dealing, failing to carry out the mission of the charity, and negligent management of assets – and 6 fell into both categories.  Under the caretory of “Fiduciary Duties Breached”, in 14 cases “payment of excessive compensation” was present.

This is a very serious problem.

For first-time readers, here is a quick summary.  Dr. Mary Grassa O’Neill is paid a salary of $325,000 as Secretary for Education and Superintendent of Schools for the archdiocese.  This is the highest paid person in the archdiocese, and we can find no other person in a comparable role in another archdiocese paid at this level.  We checked.  (If someone proves us wrong with documented information, we will issue a correction, but no one has to date).  There are 42,500 students in Catholic schools in Boston and the number is dropping every year.  By means of comparison, Dr. Carol Johnson, superintendent of Boston Public Schools is paid $265,000 and they have 56,000 students.  (Apologies for an error previously–an alert reader checked with the Boston Public Schools office and verified directly that Dr. Johnson is paid exactly $265K, with no bonus accepted).   Here is our previous post on this topic where we cited how Grassa O’Neill was making about $138,000 in 2003 in her last superintendent job.  Here is a comparison vs other public school superintendents in large metropolitan areas:

But even this comparison is flawed because, unlike public schools, where the superintendent is directly responsible for management of policy, curriculum, busing, district-wide budgets, hiring and firing teachers and principals, negotiations with labor unions, and a host of other issues, Grassa O’Neill is not directly accountable for results.  She and her office may support pastors, school leaders and faculty on an as-needed basis with areas like planning, curriculum development, recruitment and hiring, development and fundraising, but they do not actually manage, direct or drive these areas. Since most Catholic schools are parish-based, the key decisions are all made locally, so the role of Catholic Schools Superintendent is mostly consultative and advisory.  As one reader wrote to us about the Boston Catholic Schools Office (CSO):

They aren’t running anything, they are just running to the bank.  It is far from the job description of a superintendent in New York City, Brookline, or Los Angeles, where the superintendent has the ultimate responsibility and authority over the schools.  CSO has none.  So why the big paydays?

It is bizarre.  A million bucks for a command staff that commands nothing, and puts out no financial reporting, no long range plan, no results, nothing.

One of our researchers wrote to other large dioceses about salaries and recently heard back from the head of HR for one of them.  Our researcher shared the Boston salaries and asked if the other diocese could give some sense for how they compared.  Here is what our researcher wrote and received back:

To HR Director,

I am a Boston-based writer conducting some research into whether salaries paid to lay leaders and executives in the Boston archdiocese are consistent with those paid in other dioceses.  I’m wondering if you might be able to share a general range of compensation paid in ___ for key positions, such as the following. The amount in parenthesis is what has been reported publicly that these positions pay in Boston:

Superintendent of Schools (publicly disclosed salary is $325K/year in Boston)
Assoc. Superintendents of Schools (publicly disclosed salary is $188K/year in Boston)
Chancellor and head of finance: (publicly disclosed salary is $250K in Boston)
General Counsel: $300K/year in Boston
HR Director: $150K/year in Boston

Are the salaries of some of these roles a matter of public record in the ___ archdiocese?  If not, I’d appreciate if you are able to give some sense for the ranges. We are looking for a basis to compare vs other large archdioceses.

Thanks in advance for any perspectives you can share.

The response:

These are not consistent in ___.  The first 2 are way over ___
Chancellor is a priest on priest stipend
General Counsel varies but $300K is high
And I wish HR got $150K…..but, not in my lifetime.

As best as this writer can determine, based on IRS guidelines and based on the Kennedy School of Government Hauser Center for Non-Profits’ report on wrongdoing by Officers and Directors of Charities, the leadership of the Boston Archdiocese is today breaching their fiduciary responsibility by paying excessive salaries to a number of senior lay executive employees–in the Catholic Schools Office, in HR/benefits, in legal, in finance, and probably in fund-raising, communications and other areas.   Are laws being violated?  We do not know–we will have to leave that determination up to others.

The archdiocesan Presbyteral Council is meeting with Cardinal O’Malley next week.  We are asking all readers to talk to their pastor this weekend at Sunday Mass about the problems you have seen documented on this blog and ask him to request that these concerns be discussed at the Presbyteral Council meeting. You can focus on just the excessive compensation and legal risks if you wish, but better still, ask him to request that the following concerns be discussed:

  • Leadership/Governance: especially the need for engaged, active leadership and governance by the Archbishop of Boston
  • Integrity: on the part of cabinet members and the archbishop in words and actions
  • Fiscal Management: breach of fiduciary responsibility with excessive six-figure salaries being a good starting point, and
  • Team: will there be likely changes with the Vicar General (returning to the military) and the Chancellor?  How will those be dealt with?

Click on “Leave a comment” at the end of this message, and you’ll get an email link/graphic that will let you easily email a copy of this post to any friend or colleague.  If you have your pastor’s email address or that of a member of the Archdiocesan Presbyteral Council, we suggest you start there.  At the same time you are asking your pastor to request that these issues be discussed by the Presbyteral Council, let your pastor know you are praying for him and supporting him 100% in raising these issues. If you do not know your pastor’s email, talk to him in-person over the weekend.  Regardless, you can also send a copy of this post to: newstip@globe.com.


2010 Year in Review

January 2, 2011

With it still being New Years weekend, we would like to take this final opportunity to look back on the year that just closed.  Our frame of reference is mostly through the lens of the blog, mostly from after the blog started (AB), though we will share a few things from before the blog (BB).

The main events and themes revealed this past year were deception by the highest levels in the archdiocesan leadership, a reorganization of the Cardinal’s cabinet, continued  dismantling of the archdiocese (exemplified by the selloff of Caritas Christi), more Pastoral Center layoffs, major financial difficulties for 40% of parishes that are running a deficit, increased spending by the Pastoral Center on six-figure salaries, fiscal mismanagement, and a continued decline in weekly Mass attendance.  In the face of these problems, we saw an even more visible display of the episcopal leadership vacuum filled by powerbroker Jack Connors, Fr. Bryan Hehir, and Chancellor Jim McDonough, some attempts at evangelization, and the emergence of this blog, Boston Catholic Insider, dedicated to sharing the goings-on and exposing corruption in the archdiocese.

Below is a list of our top events of 2010. (If we missed any big ones, please let us know).  There is no priority order—they are just events we think are reflective of the past year and suggestive of what is to come in the future.

  • Boston Archdiocese sells off the Caritas Christi hospital system to Cerberus, a private equity firm whose name is the same name as the 3-headed dog that guards the gates of Hades.  (click on picture to zoom/enlarge). External spin was that the sale was necessary to maintain long-term financial health of the hospitals, even though Caritas had announced a financial turn-around months before the deal was  brokered which supposedly marked a foundation for long-term fiscal health with no acquisition.  Cardinal O’Malley, Vicar General Fr. Richard Erikson, and Fr. Bryan Hehir all publicly deceive the archdiocese with statements that the Catholic identity of the hospitals would be maintained forever, when in fact, the agreement allows Cerberus to drop  the Catholic identity for a $25 million payment after 3 years if deemed “burdensome” by them.  (Themes: deception, influence by Jack Connors and Fr. Bryan Hehir, conflicts of interest, dismantling the diocese, episcopal leadership vacuum).
  • Archdiocese reduces staff by 10% in June 2010, mostly by laying off low-level, long-time dedicated employees.  No people making six-figure salaries were affected.  Six-figure salaried employees who had previously taken a 5-10% pay cut to help balance the budget had their salaries increased back to previous levels. (Themes: fiscal mismanagement, poor get poorer while rich get richer, leadership vacuum)
  • Pastor of St. Pauls in Hingham (Fr. James Rafferty) rejects admission to the parish school for a child of lesbian parents. He is thrown under the bus for his decision by Jack Connors, the Catholic Schools Foundation, and schools superintendent Mary Grassa O’Neill (click on picture to enlarge). An admissions policy is drafted and advanced in approval processes amongst school principals and clergy which deceptively uses words of Pope Benedict XVI out of context as basis for the policy and rejects canonical principles of subsidiarity that would allow pastors/parishes to make such decisions themselves. (Theme: deception, influence by Jack Connors and Fr. Bryan Hehir, episcopal leadership vacuum)
  • 40% of Boston archdiocesan parishes are in the red and cannot pay their bills. Publicly disclosed figures put weekly Mass attendance at about 17%, and we hear the number has actually dropped to more like around 12%.  Pastoral planning process advances to combine multiple church buildings into parishes.   (Theme: continued decline of the diocese)
  • 5 closed parishes maintain protest vigils, after final canonical appeals were exhausted in 2010, and in some cases more than six years after they were ordered closed.  For vigil parishes, no one has the guts to simply block people from entering the churches and thereby end the vigils. Cost to the archdiocese to maintain all closed parishes is more than $1.5 million per year.  (Themes: fiscal mismanagement, episcopal leadership vacuum)
  • Powerbroker Jack Connors and Chancellor Jim McDonough reorganized the Cardinal’s cabinet (starting in the winter of 2010 through summer and fall) pushing out the previous Secretary for Institutional Advancement, Scot Landry, from that role. Their vision was, and is, to forsake the “widows mite” in fund-raising and instead go after primarily deep-pocketed donors.  (Themes: influence and consolidation of power by Jack Connors and Jim McDonough, episcopal leadership vacuum)
  • New Development Chief, Kathleen Driscoll, was named after a “sham search” where the Cardinal, Jack Connors, and Vicar General  Fr. Richard Erikson formed a search committee and told everyone in the archdiocese a real search was underway, when in reality, Ms. Driscoll had been identified as the choice before the search was ever announced.  The new fund-raising entity puts all fund-raising under the control of Jack Connors’ former Hill Holliday exec,  Driscoll, leaving the Cardinal and archdiocese further beholden to Connors’ agenda.  In sports, one might call the sham search analagous to a “head fake”—namely where a player moves their head one way to fake a change in direction. Outside of sports, one might call the explanation given internally by the Vicar General—that there were two parallel tracks to the search, one a public search that never took place and the other an internal search—either a “deception” or an outright “lie.”  (Themes: deception, influence and consolidation of power by Jack Connors, conflict of interest, cronyism, dismantling the diocese, episcopal leadership vacuum)
  • Boston Catholic Insider blog launches June 23, 2010. Chancellor’s decision to block archdiocesan access to the blog resulted in greatly increased public visibility for the blog, including articles in the Boston Globe and by the Associated Press. Communications chief, Terry Donilon, complained about “unfounded claims” on the blog, but never identified even one such claim.  By the end of 2010, the blog had 100 posts, 1,330 comments, and 150,000 pages viewed by 91,000 unique visitors from around the world.  With 80+% of traffic coming from the greater Boston area,  we estimate that about 3X more Boston-area people have read the Boston Catholic Insider blog than regularly read the archdiocesan newspaper, The Pilot.  The blog publishes an Open Letter to Cardinal O’Malley and archdicoesan leaders on August 23 (and updated September 15) asking for action on a number of issues.  Perhaps coincidentally, or perhaps not so coincidentally, the following have happened in follow-up of that open letter regarding issues in the letter.
  • Excessive Compensation in Six-Figure Salaries: Compensation Committee formed by Archdiocesan Finance Council
  • Whistleblower Policy:  About 4 years after auditors recommended the archdiocese create an anonymous whistleblower policy, the Chancellor finally did something.  He has hired Ethicspoint to host the system and the policy is nearing implementation, albeit with flawed processes around it that would make the policy ineffective if implemented as planned. (Stay tuned for more on that).
  • Names of Finance Council and Committee Members: Were anonymous for past 2 years, but now posted publicly.
  • Names of Trustees for Clergy Retirement Fund: Were finally disclosed to the clergy.  We are still awaiting the names of the trustees for the lay retirement fund six months after we asked.
  • Search for New Development Chief:  No change in direction was made after the blog started reporting on the “sham search.”  After we reported for months on the sham search, the Archdiocese confirmed it with the announcement of Kathleen Driscoll, further hurting their own credibility
  • Search for Mass Catholic Conference executive director: at least a head of the search committee, Bishop Coleman, of Fall River, was beyond criticism when the search was announced.  However, other members of the search committee have raised concerns about ties to Fr. Bryan Hehir, Jack Connors, and an agenda other than the advancement of Catholic teachings in public policy, thus the search is considered tainted.
  • Priest Appreciation: In conjunction with the Priest Appreciation Dinner, the blog launched a priest “shout out” where writers thanked more than 75 archdiocesan and religious order priests for their ministry.
  • U.S.C.C.B President Election: On a national level, Boston Catholic Insider took a short-lived detour from matters of Boston governance and corruption and contributed in at least some way to the public dialogue and derailing of the candidacy of Tucson bishop Gerald Kicanas for USCCB President.  Our “Red Alert” campaign enabled Catholics to voice objections to his candidacy directly to bishops based on past handling of allegations of sexual improprieties .  The AP, USA Today, America Magazine, Commonweal, and other national publications all reported on how Catholic bloggers had urged readers to send protest faxes and leave messages for bishops at the hotel where they are meeting.  America Magazine said, “e-mails and faxes to the bishops were apparently piling up in the bishop’s Baltimore hotel rooms.”  We cannot claim anything about BCI’s impact on the election beyond merely saying we contributed to the dialogue and played some role in enabling people to communicate their concerns with their bishops.   This last point being said, the Kicanas effort does show the demand on the part of Catholics for some vehicle to communicate with their bishops, and the impact which is possible when such vehicles exist.   This is not the last campaign you will see from BCI!
  • Cardinal O’Malley went to Dublin to serve on an apostolic visitation to Ireland in the wake of the clergy sexual abuse crisis in that country.  He told people “I am here to listen.”  (We hope we hear the same words expressed from him in Boston soon). Cardinal Seans’ blog, by the “first blogging Cardinal” evolves almost entirely into a photojournal of the Cardinal’s travels and meetings with friends and family members, portraying a bishop increasingly removed from teaching, sanctifying, and governing in Boston. (Theme: episcopal leadership vacuum)
  • Lay pension plan frozen: for about 10,000 church secretaries, parochial school teachers, and other lay employees.  Chancellor tells Boston Globe that archdiocesan employees had not had pay raises for 4 years, a statement contradicted by the reality of diocesan annual reports and many employees who indeed received cost of living increases as recently as the 2007-2008 fiscal year. (Themes: deception, fiscal mismanagement)
  • On the evangelistic  front, the archdiocese launched “The Light is On For You” to make confession available to Catholics on Wednesday evenings in Lent and most recently in Advent.  Feedback has been positive.  In addition, a new effort to reach out to fallen-away Catholics, “Catholics Come Home” will be coming to Boston in 2011. (Theme: evangelization)
  • On the vocations front, St. Johns Seminary is prospering despite the other problems in the archdiocese.  In fact, they are reaching capacity to accommodate full-time students and need more space—space the seminary once owned and which a Vatican visitation committee had recommended not be sold or given away, but which was sold anyway by the Cardinal and Chancellor James McDonough to raise money for the archdiocese.  (theme: episcopal leadership vacuum)

The Boston Catholic Insider blog has enjoyed some very proud moments and also weathered our share of criticism.  Amidst ups and downs, we are told that we have finally given a voice to those whose complaints were going unheard and who viewed there as being little hope of recovering the Catholic Church that many people have known and loved in Boston.  One person recently wrote and said the following:

“The blog has brought to reality my longtime desire to enable this particular Church to know the truth…without being traumatized into still another heartache.  The blog has pulled back the curtain with good will, good humor and, most importantly, superb documentation.  No hearts were broken to produce this blog!  (OK, maybe a couple of frowns cracked around #66, but that was to be expected.)

The abuse crisis, and to a lesser extent the parish closings and the pension mess (both lay and clergy) have resulted in some people punishing themselves by separation from their sacraments.  They wanted to slam the door on the people who broke their hearts, but instead they slammed themselves out.  The blog is allowing a difficult truth to be understood, and most importantly, allowing people to think how to go about addressing it. They aren’t storming out of the Church — they are storming into the conversation.

Congratulations on six remarkably strong months, with few hiccups!

We feel very good about what the blog has accomplished in the past six months.  Now, onward and upwards to the challenges and opportunities of 2011!


Newsflash: Welcome Another Six-Figure Salary to 66 Brooks Drive

December 28, 2010

Welcome back, post-blizzard, to the latest edition of Boston Catholic Insider.  We are now back in town safe and sound and were primarily going to focus on another topic today—namely, the fungible nature of fund-raising from the Archdicoese, but the alarm bells are going off over the latest move by Chancellor Jim McDonough—the hiring of an Executive Director of Finance and Operations, making in the high six-figures, along with yet another organizational change.  Anyone thinking about making an end-of-year donation check to the Catholic appeal may want to read further before you break open the checkbook.

First, has anyone else noticed that for the first time in six years, there is no published fund-raising goal for the 2010 Catholic Appeal?  Parishes have a number they are each supposed to raise and pastors are hounded by the fund-raising team to meet that goal, but the new Jack Connors/Jim McDonough-conceived archdiocesan fund-raising apparatus as a whole has no published goal?  (When the campaign launched earlier this year, they only said they wanted to “match last year’s success.”)  Does that mean enthusiasm level, or the numerical goal of $15 million?  How are Kathleen Driscoll and her “dream team” of people from the Campaign for Catholic Schools going to be measured and held accountable?  What are the consequences for their future employment if they miss?  By the way, who knows how far off their target the Campaign for Catholic Schools “2010 initiative”–whose name suggests the campaign ends in 3 days—will fall?  When Kathleen Driscoll was announced to head the new development entity, they were $12 million short of their $70 million target.  Will the team that will probably fail at hitting that goal also fail to reach the unstated target for the Catholic Appeal? 

With the economy still depressed and 40% of parishes in the red, what is the exact amount raised to date in the 2010 Catholic Appeal?  How far off are they expected to be and what will happen to make up for the shortfall?   We hear there are already tensions between pastors and Ms. Driscoll over the Appeal, so who knows what will happen as the extent of a potential fund-raising shortfall becomes clearer.

People who work for the Pastoral Center know the routine when it comes to pruning from the budget.  Shortly after the appeal closes, former banker, Chancellor McDonough, will know how much money he has in the bank, and then the annual expense reduction panic will set in. Meetings with each department head will be scheduled and tracked in a spreadsheet to discuss how they will cut money (expense or heads) from their budgets. Some pastoral ministry or ministries that previously were important will now become less important as they are put on the chopping block, and some long-time loyal employee(s) working for $40-50K will be put on the 2011 layoff list.

This all is a backdrop to the news du jour, namely, that Chancellor Jim McDonough has hired a new Executive Director of Finance and Operations.  Here is the email notice. 

From:McDonough, James P. [mailto:James_McDonough@rcab.org]
Sent: Tuesday, December 28, 2010 8:57 AM
To: _Pastoral_Center
Subject: Welcoming John Straub, Executive Director of Finance and Operations for Central Ministries

Good morning, I am pleased to announce that Mr. John Straub will be joining the Archdiocese of Boston as the Executive Director of Finance and Operations for Central Ministries. John joins the Finance and Administration Secretariat and will report to me. John will start on January 2nd. His office will be located on the fourth floor of the Pastoral Center.

In this position, John will provide Central Ministries with a valuable skill set that will enable stronger internal project management and help improve communication and coordination among our various staffs. John brings to this position a breadth of experience that will be of significant assistance to the Archdiocese as we continue the effort to rebuild and strengthen our local Church for the benefit of our 1.8 million Catholics. A graduate of Catholic University in Washington, D.C., John has served as Chief Financial Officer of the White House during the Administration of President George W. Bush and as Chief Financial Officer of the US House of Representatives. He previously served as an Associate Dean at Harvard University’s John F. Kennedy School of Government. The addition of John as Executive Director of Finance and Operations is intended to provide improved management and oversight in these critical areas. It also acknowledges the wide scope of the Administration and Finance Secretariat and provides the necessary management depth to effectively meet the diverse and complex needs of our parishes, schools and ministries.

John will have the following individuals as his direct reports:
· Joe McEnness, Director of Risk Management
· Kevin Kiley, Director of Budget and Planning
· Glen Mattera, Director of Finance
· Jim DiFrancesco, Director of Human Resources
· Director of IT (search underway)

I will continue to have Carol Gustavson, Pension/Medical Plan Trust Administrator, as a direct report.

In addition to her role as Trust Administrator, Carol will continue to coordinate Building Operations and the central telephone operations as well as the building floor plan.

Denise McKinnon-Biernat, Director of Parish Services, will be a new direct report to me.Denise plays a critical role with the Improved Financial Relationship Model and plays a major support role in Pastoral Planning. Deb Dillon, Director of Real Estate, will report to Denise.

The Cardinal, Fr. Erikson and I are keenly aware of the need to do more with less. We recognize that everyone has taken on more and we are gratified by your tremendous work ethic and devotion to serving Christ and the Church. As Chancellor, I have endeavored to lead by reducing the most staff so that other ministries would be spared. Since I arrived at the Archdiocese, the staff headcount of my Secretariat has been reduced by 23%, declining from 91 to 70 persons. Throughout this time we have directed available resources to serve our parishes. John’s position, and the experience and love for Christ and the Catholic Faith he brings to us, is intended to continue to build on that goal as a commitment to our culture of support to parishes, schools and ministries.

Thank you,
Jim

James P. McDonough
Chancellor

Archdiocese of Boston
Pastoral Center
66 Brooks Drive
Braintree, MA 02184
P: 617-746-5670
F: 617-779-4571

We have so much to say about this, it has taken a little longer to put together all of our thoughts.  Here are a few initial reactions.

  1. Another big salary.  Did this one run through the new anonymous “Compensation Committee”?  Is Jack McCarthy, the vice chair of the Finance Council, paying attention to all this?  And is the Finance Council approving all this?
  2. What does this say about the ability of Chancellor McDonough and/or his direct reports (making six-figure salaries) to get the job done for the $1+M they all are already being paid collectively?  Who exactly has now been determined to be incompetent and thus will be shown the door some time soon?  The Chancellor?  one of his previous deputies?  The Archdiocese is shrinking every year, not growing, so why is it the Chancellor cannot keep up with his duties?  Is he busy engaged in activities not on his job description?  (wherever that job description may be…)  At one point, Kevin Kiley was supposed to be the Chancellor’s #2 person, but that did not work out.  Then Carol Gustavson was to be the #2, but she had the minor complicating factor of not being able to get along well with people. (Not a personal attack–objectively true).  Now we have this new person.  Is the new person being positioned to become the next Chancellor, should the current chancellor, hypothetically speaking, find his term not renewed or leave voluntarily? 
  3. What exactly are the job descriptions, goals/success metrics, accountabilities, and competencies needed for the positions that Kevin Kiley and Carol Gustavson hold today?  Are they maintaining their jobs because they are highly competent and capable of doing these jobs, or because the Chancellor sees them as loyal to his agenda?
  4. Who has decided to pay Carol Gustavson $150K to manage benefits, the building floorplan and the phone system, or even keep her–a trained, non-practicing attorney–in a job in view of the reduction in responsibilities? She is no longer listed as head of HR in the memo, so has her pay been reduced?  How many minutes a month could managing the building floorplan for a continually shrinking Pastoral Center staff possibly take?  Does everyone not already have a cube, or are they planning a New Years game of musical chairs along with the reorg? Or might the Chancellor, hypothetically, simply want or need to have a loyalist continue to control who gets cubes vs offices, and the size of offices for those who get them? Regarding the telephone system, did they not get rid of the phone operator, as it is mostly automated now? By the way, is Carol managing the mailroom delivery as well?  That should add lots of extra burden on her schedule–what, with a relatively new person on-board who replaced the long-term loyal mail-room guy with decades of service who was laid off because they did not realize he was really needed, then never rehired, and replaced by a newcomer? 
  5. Does no one see that $150K/year for the proudly ex-Catholic Gustavson as excessive spending for that role?  Has anyone compared that compensation to other dioceses?  (We have, and the information we got back said it objectively excessive).  She cannot even publish a list of trustees for her Benefits Trust. Can that same job not be done for around $75K/year instead?   By the way, were there not people previously in HR at the RCAB skilled with benefits doing basically this same job for much less pay who are now gone?
  6. Was this an open search?  How many candidates were interviewed?  Why is it that the announcement mentions nothing of Mr. Straub’s most recent job stint for 4 years in a largely non-relevant role as VP for Kane is Able, a small Scranton, PA-based family-run third-party logistics provider that helps consumer packaged goods companies warehouse and distribute goods?  How is it that, coincidentally, that the new person just happened to have previously been at Harvard’s Kennedy School of Government, where Fr. Bryan Hehir earns his own six-figure salary and cushy future pension that will afford him freedom from any of the retirement-related worries that other less well-connected diocesan priests have to worry about?
  7. The comment that “As Chancellor, I have endeavored to lead by reducing the most staff so that other ministries would be spared” needs to be explained more completely.  How many lower-level staff were laid-off and replaced by much more expensive staff?”  How much has he spent on consultants?  How much has been spent on the ill-conceived Lawson Software project?  The comment “Throughout this time we have directed available resources to serve our parishes,” is also deceptive. We will go into this more separately.
  8. Where is the publicly posted copy of the 2010-2011 operating budget, as part of the financial transparency and improved financial relationship model?  The 2010 budget is posted, but here we are half-way through the fiscal year, and no sign of the 2010-2011 budget.  Why is it so difficult for the Chancellor or someone on his $1.1M staff to post the budget?  Exactly how far through the year are you going to tell pastors who are asked to break their backs raising money for the Appeal how you are spending that money? 

Apologies for any excessive emotion that comes through in this post.  We are livid and believe every pastor, priest and lay person in the archdiocese should be as well. 

We have been told, and we concur, that there are 3 things that drive some action by this archdiocese–lawsuits (or threat of them), bad publicity (or threat of it), and money.

It is clear that the current leadership does not get it, and they need a wake-up call from both the clergy and laity.  Something radically different needs happen quickly with governance in the archdiocese.  We have a few ideas, but will save those for a next post.


Chancellor’s Deceptive Compensation Comments

December 14, 2010

Just when we thought we were about to leave the topic of compensation, Chancellor Jim McDonough was quoted in the Boston Globe as saying something that was not exactly accurate, so we remain on compensation for just a little bit longer.

As we reported in “Latest Archdiocesan News,” on Sunday, Chancellor Jim McDonough was quoted in a Boston Sunday Globe article, Archdiocese to end lay pension plan, about the freezing of the employee pension fund as follows:

“McDonough said it could take many years for the pension fund to become fully funded again, but when it is, the church hopes to redirect the money it had been paying toward stabilizing the fund toward other employee benefits. He said employees have not had a raise in four years.”

This statement sparked a flurry of comments on the blog and private emails to us.  Some people said they believed there were cost-of-living increases given in the 2006-2007 timeframe, and some people said there were not.  But just about everyone agreed that the archdiocese found a way of raising salaries for selected people when they wanted to.   What is really going on?

The Deception

As usual, the commenters to the blog got it a lot closer to the truth than the Chancellor did. As best as we can determine, over the past 4 years some people got cost-of-living increases, and some people did not.  Some people got salary increases greater than what can be accounted for as a cost-of-living increase (with their title kept the same), and sometimes there were title changes along with a salary increase, which give at least the perception that the title change was a justification for the pay raise.  Amidst pay increases for some, a lot of lower-level people were laid off.

The bottom line in all of this is that the higher compensated individuals seemed to be much better taken care of than the lower-paid individuals.  Sort of the same mindset we hear from priests all the time–namely that the archdiocese seems to put a higher priority on the needs of Corporation Sole than on the needs of pastors and priests out in  parishes, college campuses, prisons, hospitals, retirement homes, and other places in the real world that exists outside of 66 Brooks Drive.

We will use two individuals to exemplify how it is obvious the Chancellor was not being honest and accurate in his comments to the Globe.  Then we cover the layoffs.

  • Terry Donilon: Secr. for Communications.  In the 2006 annual report, we were told he was paid $160,680.  It was the same in the 2007 annual report, but in the 2008 annual report (p. 68), it was up to $166,304.  To the right is a picture showing 2007 vs 2008 for Donilon.
  • James Walsh.  In 2006 he was in the top 5 highest paid employees making $137, 523 as Director of Parish and School Services.  In 2007, he was making $144,626 in the same role as Director of Parish and School Services.  In 2008 , he was making $163,650 as Assoc. Superintendent of Schools.  In 2009, he was making $185,270 as Assoc. Superintendent of School.  Click on the picture at the right for the 2006 to 2009 progression.

This is just objective, published information everyone can see that demonstrates the deception just propagated by the Chancellor.  If these two individuals saw pay increases and these increases happen to be published for the top employees, who else saw increases that were not published publicly?  Were some of the increases somehow rationalized by the  McKinsey project commissioned by the Chancellor?  (By the way, why are outside consultants who know nothing about the archdiocese and Catholic Church better suited to solve these problems than Catholics with common sense who know and care about the good of the Church?  But I digress…)

The Rich Stay Rich; The Not-So-Rich Get Laid Off

Then there was the whole matter of the 1-year temporary decrease in 2009 for people making over $100K (5% decrease) and over $250K (10% decrease).  The temporary reduction in salary for those 25-27 positions who earned in total about $3.8M would save around $250K during the year, and was supposed to help save money to balance the budget.  Turned out that the budget was not quite balanced, so what did Chancellor McDonough do?  He restored the salaries of the high-paid people (including himself) to their previous levels, and then at the same time laid off 20 lower-paid people this past June.  What if some of those six-figure salaried employees would have been willing to keep their salary at the slightly reduced level in order to preserve a handful of jobs for the lower-paid loyal employees with decades of dedicated service of the Church?  Was that even an option considered?

Comp. for Top 5 Employees Nearly Doubles

We would be remiss in this discussion to not point out the change at the high end for the top 5 salaried employees.  In 2005, the archdiocese announced that the “Total amount paid to the top five employees was less than $750,000.”  As of this writing, the total amount paid to the top five employees is around $1,375,000.  (Grassa O’Neill at $325K, Lovely at $300K, McDonough at $250K, Landry at $250K, and Driscoll assumed at minimally $250K if not higher).  The fact of compensation at the high end having nearly doubled over the past 4-5 years while the underlings had their pay frozen somehow did not make it into the Globe article.

So, what we have are the objective facts that: a) there are a lot of high salaries paid to lay employees, b) lower-level employees keep getting laid off, c) the lay pension plan is being frozen, and d) the latest comments by the Chancellor on the topic are deceptive–if not simply untrue.

The archdiocese and Finance Council seem to think the solution to the problem of excessive compensation created by current management and approved by the Finance Council is…Ta Daa…form a new committee and hire an expensive compensation consultant to evaluate the situation.  This new expensive consultant engaged by the new committee will make recommendations to the same management that created the problem (with the help of a different consultant) and that has violated trust with Boston Catholics by virtue of deceptive actions and statements.  What’s wrong with this picture?  Has anyone heard of the expression “throwing good money after bad?”

Would it not be better to first try changing the current management and conduct an inexpensive straightforward salary comparison vs other dioceses BEFORE engaging yet a second expensive consultant?  Save the money on the consultant for a little bit.  Would not those limited donor funds and contributions be better used for pastoral ministries, evangelization, parishes running in the red, clergy benefits, lay benefits, and outreach to the poor and needy?

The Vice Chair of the Finance Council and head of the Steering Committee is Jack McCarthy, who we are told is a man of integrity. Perhaps if a number of our readers forward him this blog post, he might be encouraged to take up the matters of both the Chancellor’s deception and the excessive salaries with greatest urgency at the next Finance Council meeting.  His email is jack.mccarthy(at)neu.edu.

We have yet one more installment on Compensation for tomorrow, then onto other ethical breaches, corruption, and deception-related topics.  If you have a little spare time, we could use some help with research, but stay tuned for more on that tomorrow.


Christmas Concerts, Compensation Comments

December 10, 2010

We have gotten such amazing feedback and comments on our latest post about the planned Finance Council Compensation Committee that we felt we should just share the comments with you via blog post in case you have not had a chance to read them all.

But first, if you have not yet finalized your weekend plans, we wanted to let you know about the annual Christmas Concerts performed by the Daughters of St. Paul. at their convent chapel 50 Saint Pauls Ave, Jamaica Plain.  This year it is called “A King is Born” and it is sure to be a treat for everyone from children to adults.  You can choose from either the Saturday, Dec. 11 performance at 7pm or the Sunday afternoon performance at 3pm.  Tickets are just $10.  For more information, see here or call 617-522-8911.

Compensation Comments

The comments people posted were so well thought-through and insightful, we could not do justice to them by just sharing a few excerpts, so we are giving you the whole enchilada by sharing them in today’s post.

The gist of the matter is that the archdiocese has hired a particular set of executive leaders and built a compensation structure that feels inappropriate for the Catholic Church, may have attracted the wrong people for certain jobs, and also could be seen by contributors as a misuse of donor funds.  It is also so costly as a percentage of total revenue that it is may well be financially unsustainable.

Here are the comments posted to the blog, as well as one sent via email.

Anonymous (via email)
The whole idea of a this committee will be quite foreign, and probably alarming, to the clerical cadre.  The central offices in the past were an employment opportunity for clerical workers with a high school education for those in the local area, for mid-level managers who liked the ambiance of the place, and for the retired who would take less and wished to work for the Catholic Church.  Most liked the tie-in to a “vocation” in working for an organization that was respected, but where nobody ever got rich.

That was destroyed by the scandal and its continuing aftermath. Now we have this truly crazy charade of imposing highly paid lay management on a religious organization in the hopes of what exactly?  Are there other religious denominations that do this to themselves?

  1. A. J. Constantino says:

    Great post!

    Let’s get to basics, each “lay executive employee “should be clearly defined by a Job Description; Objectives, Accountabilities and Measurements.

    Human Resources should be developing the Job Description with the hiring manager; while the objectives, accountabilities and measurements should be set by the manager and the employee and placed on file with HR.

    The question is does the RCAB have these “Standard Operating Procedures” in place?

    Next: there are countless FREE resources available to develop compensation packages =- it’s not a mystery!

    I have worked in several large companies, where the Presidents/CEOS have been anxious to use outside consultants, after paying large fees, we most often learned that no one knows our business better than we did and in the end “self-determination” was best.

    From the “outside looking in”, it appears that “lay executive employee” salaries are disporportionate to the overall RCAB budget.
    The biggest mystery is why men and women, with the background and experience of Chancellor McDonough, Mr. Connors and MS. Sen have not applied the “for profit” experience into the “non-profit” experience of the RCAB. All three have to know that the % of revenue to compensation would not be acceptable in a “for-profit” business.

    For those who may be bit put off my analysis, it’s a business world prospective, NOT a Church world perspective. In my opinion, a $100.0K-$150.0K salary for a “lay executive employee “ for the RCAB is just–with, once again, in my opinion, one exception, “in house” Legal Counsel.

    • Carolyn says:

      AJC,

      You are, literally, right on the money. If six people were paid between $100K and $150K, who were true leaders and put in long hours, I would be fine with it. The salary would be a good return on investment for the donors (us) and the “works” would work.

      What we have now is bloated compensation combined with questionable motivation in some cases, and questionable performance in others.

      The head of planning for RCAB came straight from Arthur D Little back in the early ’90s. (Like the day after he retired…) His salary was a staggering $1 per year after having been handsomely compensated for many years. He showed up every day, tie and coat, worked diligently in sometimes rustic office settings, and really brought his experience to the table.

      One or two of those in the mix would be a fabulous addition to a half dozen highly competent individuals paid a salary commensurate with the resources of the organization.

  2. A Priest says:

    I agree a salary of 100-150K is about right for a true executive with the right experience who wants to give back to the Church that gave him or her new life through Jesus Christ…of course over time that may rise slightly due to performance raises but the reality of the situation is; anything higher as a starting salary is bogus. I wouldn’t mind a return to priests in the Chancellor’s office, I think there are qualified guys out there who could do the job for a few years and then head back to parish life. Let’s maximize the resources we have.

  3. Disgusted Boston Priest says:

    About 20 years ago, a drumbeat began: “There soon won’t be enough priests – we need to empower the laity to run the Church!” It was, in my opinion, begun by dissatisfied and faithless priests who were afraid to promote vocations; it was repeated constantly in the seminary by many of the same priests who no longer believed in the authentic priesthood of Jesus Christ, and it began to be picked up by the liberal press, who were delighted to have another instrument to create noise in the ever-growing cacophany of anti-Catholicism.

    The euphemisms of “increased lay participation” and “empowerment” have led to the current situation in the Archdiocese of Boston (and other places), where those ordained by Christ to shepherd His Flock now find themselves beholden to [read: hostage to] an increasingly emboldened laity. However, far from the ideal spouted by those disaffected priests some twenty years ago, the group of laity who have become “empowered” are those who already knew what power is and how to use it for their own ends.

    Jack Connors was loudly and roundly touted by The Boston Globe as the solution to the problems of the Archdiocese. After all, he’s financially successful, he’s influential, he’s connected and he wants to help. The fact that Jack’s faith is pitifully uninformed (my guess is he’s somewhere in the range of a seventies Jesuit) and that he might have his eyes on some low-hanging fruit in the assets of the Archdiocese that he might be able to convert to the use of friends didn’t seem to dissuade Cardinal Sean from doing the bidding of the Globe and hiring Jack on as his chief advisor.

    Jack Connors is now being quoted as wanting to rebuild the faith – and we are surprised? In his estimation, our faith is naive and unproductive, unhelpful to the bottom line. Like so many others, Jack thinks that to cure the ills of our “business” we need to “discover” a product that sells – and because we’ve been hemorrhaging money for the last several years, he figures it must be a problem with the product – the faith of the Apostles. If only our churches, our schools, our preaching were more friendly, goes his reasoning…

    Once firmly ensconced in power at the Archdiocese, Jack has – like any good oligarch – moved quickly to consolidate and expand his power base. He’s appointed friends (I’m sorry – he’s recommended them to Cardinal Sean) to positions of power that buttress his own. He’s paid them well (oops, recommended good salaries) so that they don’t forget which side their bread is buttered on. And he’s used his new found power to reward associates in the business community, from whom he ought to expect some form of recompense.

    Jack Connors is doing what good businessmen do.

    Unfortunately, while we do need good business sense to run our finances, we don’t need a profiteering businessman like Jack Connors to run the Corporation Sole – to discard unprofitable operations (like the seminary and Catholic hospitals) and to start up new ventures (like the Dorchester school debacle) which merely utilize the hard-earned money of the faithful to build a parallel public school system.

    The reason this blog is so hated in the executive offices at Brooks Drive is that you’re paying attention to the little man behind the curtain instead of the Great and Powerful Sean. Keep it up – with Jack Connors determining the content of our faith, much more than our money is at stake!

    • Fr. D says:

      I have to agree with most of the post and some of the phraseology betrays the poster’s age. There are a lot of factors contributing to the dearth of vocations and most of it is the reaping of poorly planted seeds from past times. I don’t think Father would disagree with that observation.

      I personally have never met this Jack Connors character. He sounds like a real pip to me.

      The bottom line is that the RCAB is really weak at this time and prime for the picking and it looks like Jack has a large bag in hand and is ready to gather in the fruit of his work!

  4. Clem Kadiddlehopper says:

    Ah, Disgusted Boston Priest stole my thunder. Corporation Sole is now a corporatocracy that serves the interests of the laity that direct its operations solely for the power and benefit of said laity. You can believe it or not. I have checked with Ripley, and he verified it.

  5. catholic Data Nerd says:

    In corporate life, the creation of a compensation committee (or the publicity of an existing one) is usually an acknowledgement that people realize they have a public relations problem, a compensation problem, or both. So the creation of this compensation committee MAY be an acknowledgement that many leaders are acknowledging a problem. That might be a sign of progress at 66 Brooks.

    A key question is whether the compensation committee idea was one of McDonough’s/Connor’s (to deflect accountability from them) or one forced on McDonough from O’Malley, Erikson and others (to bring the decisions back into a more normative salary band). Either way, it’s clear McDonough or someone with familiarity with corporate boards wrote the language you pasted above.

    The questions BCI poses above are all good ones. Identifying the appropriate benchmark or comparable organizations is key and other Northeast diocesan compensation is the BEST comparable.

    Having studied executive compensation as part of my day-to-day duties, and having followed the Church for a while, I’d make a few notes to the post and comments above:

    1. Comp salary bands should have distinctions depending on the type of candidate: (a) priest (comp is pre-determined); (b) religious (comp is pre-determined); (c) deacon (hybrid comp between clergy and layperson comp, assuming that they are still have many dependents); (d) layperson “after” prime of their career (who is “giving back” to the Church like the Chancellor or the general counsel); (e) layperson “in the prime” of their career who still has young dependents to put through Catholic schools, college, etc. (which seems true of about half of the highly comped staff members)

    2. Comp bands of $100-150K for key positions seem justified in this market. To get someone “extra” good or who needs more to take the role (see 1e above), the comp should only be increased IF a benefactor underwrites the comp above $150K. Those “heavy hitters” on the finance council that recommend key people for high comp should be willing to fund some part of these positions’ higher salaries. For example, if Connors and the Campaign for Catholic Schools was subsidizing Dr. O’Neill’s salary of $325K, it would be much more acceptable.

    3. While the Chancellor role probably should be the highest paid role (if occupied by a layperson), given McDonough’s previous business success, why didn’t anyone seem to ask him to work for a lower figure (let’s say $100K) or why didn’t he volunteer to do this PARTICULARLY when he was letting go many people who made <$50K/year in several rounds of cuts? Does he REALLY need that salary? What does it say to him that he continues to take it?

    4. In whose judgment did anyone think it made sense to pay a very successful lawyer at the end of his working career $300,000? Whoever made that determination should be willing to subsidize the position with outside funds. This is nothing against the individual in question, who is hard-working and productive, it’s just shocking that a lawyer over 70 years old needs to make $300K to be interested in taking the role to help his Church and to give back.

    5. Generally speaking, the principle that a person working for the Church should always be making somewhat less than they could make in the private sector should be part of this new “compensation philosophy” that the committee recommends. Never should we have a situation where we need to pay someone MORE to dedicate themselves to the Church. That seems the case with the superintendent of schools and several of the people that report to the Chancellor.

    6. On the compensation committee, common-sense pastors who need to ask for Appeal contributions should be the majority of the compensation committee. They need to tell the Finance Council members that there are no real “executives” in the Church, just “servants” of the Word of God who work with pastors and other leaders to advance the Church’s mission. Pastors are there to insist that the focus be maintained on who is actually paying for these salaries and what is justified to them, vs. these “professional board members” who are professionals at spending other people’s money.

    Good work BCI.

    • Objective Observer says:

      CDN,

      Terrific analysis and summary. A pastor is the primary representative of the ordinary in the parish (canon law). In English, that means that he represents the cardinal to the people, and the people to the cardinal. These priests should be at the table, joined by men and women whose notion of fiduciary duty and unambiguous ethical direction are unimpeachable.

    • A Priest says:

      CDN…awesome post!

     

Much appreciation for the compliments on our original post!  And thanks to all for taking the time to write out your insightful comments in response.  We may just send these to the Finance Council and Archdiocesan leadership team, but you should also forward this to your pastor and/or local Archdiocesan Pastoral Council Member.  More next time!


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