Religion

Franklin Graham takes pay he once gave up

Dr. Kent Brantley, left, with Franklin Graham in 2014. Brantly, a doctor for Samaritan's Purse in Liberia, survived Ebola.
Dr. Kent Brantley, left, with Franklin Graham in 2014. Brantly, a doctor for Samaritan's Purse in Liberia, survived Ebola. tsumlin@charlotteobserver.com

Six years ago, Franklin Graham decided to give up his pay as head of the Billy Graham Evangelistic Association.

“I feel that God has called me to this ministry and that calling was never based on compensation,” he wrote then in a memo to the BGEA staff.

But since 2011, at the urging of the Charlotte-based ministry’s board of directors, Graham has been receiving a salary again.

That’s in addition to the more than $620,000 he receives for his other full-time job, leading Samaritan’s Purse, an international relief agency based in Boone. His 2013 compensation from Samaritan’s Purse alone made him the highest-paid CEO of any international relief agency based in the U.S., according to data provided by GuideStar, the world’s largest source of information on nonprofit organizations.

Graham’s total compensation last year from the two charities was more than $880,000, including $258,667 from BGEA.

That total is less than the $1.2 million he received in 2008, but it’s still more than some nonprofit experts consider appropriate.

Graham, 63, inherited the BGEA from his famous father – Charlotte-born evangelist Billy Graham, now 96 – and has led Samaritan’s Purse since 1979. Both are Christian organizations that evangelize and send rapid response teams – including chaplains – to the scenes of natural disasters or to cities such as Ferguson, Mo., undergoing turmoil.

In 2009, questions raised by the Observer about Graham’s rising financial compensation during tough economic times prompted the evangelist to announce he would – “for the time being” – give up future contributions to his retirement plans from both BGEA and Samaritan’s Purse. This came after BGEA’s revenues dropped 18 percent and it laid off 10 percent of the staff.

Graham acknowledged to the Observer then that, whatever the explanation, his compensation total “looks terrible” and that “people won’t understand it.”

At the time, Graham was clear the suspension of payments to his retirement was temporary, and they could resume “if or when the economic situation improves significantly,” as Graham spokesman Mark DeMoss told the Observer then.

Two days later, Graham sent a memo to BGEA employees that he had made another decision. He said he had asked the BGEA board of directors “to consider that I work for no compensation.” Graham made no mention of a time limit or any other qualifiers.

But his decision to give up a salary at BGEA lasted only one year. In 2011, he was paid $100,000. That grew to $109,277 in 2014.

Graham did decline all contributions to his retirement plan until late in 2012. By 2014, his retirement, health care and insurance compensation from BGEA accounted for an additional $149,390.

The Observer made repeated requests last week to interview Graham but was told he was not available. Also unavailable for an interview: C. William Pollard, who headed the BGEA board’s compensation committee.

Graham spokesman DeMoss told the Observer in an email that Graham “never said he would give up his pay forever. He chose to give up his salary and retirement benefits for a season, in part because of the national economy in 2009.”

DeMoss added that the move to resume paying Graham came in 2011 from the BGEA board of directors’ compensation committee, not from Graham – who chairs the ministry’s board as well as being president and CEO.

“The board spoke up (in 2011) and said, ‘Listen, we think you should be paid,’” DeMoss said in a follow-up phone interview. “And he agreed.”

Graham got the same pitch from the board back in 2009, DeMoss said.

At the time, DeMoss put it this way to the Observer: “They said to him that the CEO ought to be compensated. But he’s at the point where, ‘Here’s what I’m going to do. I make a comfortable salary at Samaritan’s Purse.’”

In 2009, Graham’s two salaries, two retirement packages and other payments totaled $1.2 million. Most of that, Graham pointed out at the time, was due to accelerated contributions to his retirement. He’d received no retirement his first five-plus years at Samaritan’s Purse and his first year at BGEA. The boards said they were playing catch-up to satisfy Graham’s goal of working for free when he reaches 70.

The economy has since rebounded, there have been no more layoffs at BGEA, and revenues at both charities headed by Graham have been rising every year – at BGEA, from $93 million in 2008 to $106.5 million in 2013.

Graham’s 2014 compensation from BGEA was about 60 percent less than what the ministry paid him in 2008, DeMoss said in an email.

Several nonprofit experts, though, said Graham should have stuck with his decision to forgo pay from BGEA.

“It gives the appearance that he went back on his word and can’t be trusted,” said Ken Berger, a nonprofit consultant and former CEO of Charity Navigator, which evaluates nonprofits for donors. “It’s worrisome. It appears sneaky.”

Pablo Eisenberg, a senior fellow at the Georgetown University Center for Public & Nonprofit Leadership, agreed.

“It doesn’t matter that some board members wanted him to get money again,” Eisenberg said. “He’s a big boy. He could have said, ‘no.’ ”

DeMoss’ reply: “This organization has earned the trust and prayers of those who support it with their financial and prayer support for more than 60 years and continues to be as transparent as possible.”

Same issues

Nonprofit watchdogs raise questions about the size of Graham’s overall compensation and whether one person should do – and get paid for – two full-time jobs. Those are the same two issues that sparked controversy in 2009.

Graham’s pay is “definitely an outlier for the nonprofit sector,” said Sandra Miniutti, Charity Navigator’s chief financial officer.

“When you start getting compensation above a half million dollars,” she said, “it’s probably not appropriate for the nonprofit sector.”

Plus, leaders of larger international relief groups make less than Graham. Food for the Poor, which has a budget more than twice as large as Samaritan’s Purse, provided CEO Robin Mahfood a 2013 compensation package that was about $200,000 lower than what Graham received from Samaritan’s Purse alone.

Food for the Poor provides food, housing, clean water, health care and other services in 17 countries throughout the Caribbean and Latin America.

Gail McGovern, the CEO of the American Red Cross, had $597,061 in total compensation in the fiscal year ending in June 2014. That was lower than what Graham got from Samaritan’s Purse, even though Red Cross’ budget is about $3 billion – about seven times larger than Samaritan’s Purse’s.

DeMoss said both the BGEA and Samaritan’s Purse boards use independent compensation studies when considering Graham’s pay. He said the studies look at executive compensation at organizations of comparable size.

Though Graham was named BGEA board chairman in October 2014 – he’s also president and CEO – he “does not participate in deliberations about his compensation,” said DeMoss.

Three other Graham family members also sit on the 14-member BGEA board – Graham’s son Will, his sister Anne Graham Lotz and his cousin Melvin. But DeMoss said none of them are on the board’s compensation committee, which sets pay.

CEO of 2 nonprofits

There’s also the issue that prompted the Observer to look into Graham’s pay in 2009: How can one person run two large nonprofits?

“Unless you have virtually no personal life … it doesn’t seem viable to do that kind of double duty,” Berger said.

Added Miniutti: “It seems impossible for one person to run both organizations.”

DeMoss said asking whether one person could lead both Samaritan’s Purse and the BGEA “would be a fair question if one or both organizations were going backward. I don’t hear anybody making that argument.”

In 2013, Samaritan’s Purse, with 2,133 employees, raised $460 million and spent $402 million; the BGEA, with 959 employees, raised $106.5 million and spent $98.8 million.

As big as Graham’s two charities are, DeMoss said, together their revenues and workforces are dwarfed by some other nonprofits that have just one CEO.

“Would the people asking how one person can effectively lead two organizations with annual revenues of $500 million-plus,” he said, “ask how one person can effectively lead the $1.2 billion Boy Scouts or the $3.5 billion Red Cross or the $4.3 billion Salvation Army?”

Graham was not the highest-paid person at BGEA in 2013. Five other executives had higher total compensation, according to the group’s IRS return. Those five had compensation ranging from about $241,000 to $326,000.

At Samaritan’s Purse, Graham was the highest-paid executive. The second – Phyllis Payne, a vice president – made about $364,000 in total compensation. Graham made $622,252.

Certainly, a lot of corporate CEOs make much more. But many philanthropy experts say it’s unfair to compare salaries in nonprofit organizations with those in the for-profit world. That’s because nonprofits get substantial tax breaks – a form of public subsidy. In exchange, they’re expected to keep salaries lower.

Commitment to help

Samaritan’s Purse is often the first agency at the scene of natural disasters around the world. And it’s demonstrated a deep commitment to serving the people of Haiti and, especially during last year’s Ebola scourge, those in Liberia.

As the face and voice of the BGEA, the ministry started by his father decades ago, Franklin Graham also heads up crusade-like Christian festivals around the country and the globe. In June, he led a festival in Ukraine. Coming up: festivals in Birmingham, Ala. (Aug. 14-16); Oklahoma City (Aug. 22-23); Fortaleza, Brazil (Oct. 23-24); and Tokyo (Nov. 20-22).

“I don’t know where he finds the energy,” said Ken Barun, Graham’s chief of staff at BGEA. “I’ve worked for some of the biggest companies in the world (including McDonald’s) and I have never seen this.”

While Graham gets high marks for international relief work – Samaritan’s Purse also runs Operation Christmas Child, which sends holiday presents to poor children around the world – his leadership of the BGEA has made him a polarizing figure.

As head of that organization, he speaks – through publications, broadcasts, events, and most recently Facebook postings – to hundreds of thousands of evangelical Christians. He’s been outspoken in his criticism of Muslims, the Obama administration and the move to make same-sex marriage legal in all 50 states. He’s also been accused of using the religious nonprofit as a megaphone for conservative politics. In 2012, he took out ads that effectively endorsed Republican Mitt Romney in his race against President Barack Obama.

Recently, some evangelicals joined Muslims in denouncing Graham’s call on Facebook to bar Muslims from emigrating to the United States.

“We should stop all immigration of Muslims to the U.S. until this threat with Islam has been settled,” Graham wrote after four U.S. Marines were gunned down by a Muslim in Chattanooga, Tenn. “Every Muslim that comes into this country has the potential to be radicalized – and they do their killing to honor their religion and Muhammad.”

Next year, a presidential election year, DeMoss said Graham is planning to headline a national BGEA tour, with prayer rallies in all 50 states urging Christians to not only pray for America and live out biblical principles but also to vote and “vote for candidates who will support biblical values.”

As for how he manages his two jobs, DeMoss said that, on those weeks when Graham is not traveling, he splits his time between Boone – where he lives and the headquarters of Samaritan’s Purse – and Charlotte, where the BGEA is based. He’ll meet at each workplace with his teams and sometimes hold back-to-back board meetings for both charities in the same city.

DeMoss said Graham defines his job as casting the vision, raising money, developing new ideas and projects, recruiting good people and keeping the charities true to their missions.

“He doesn’t have many hobbies,” DeMoss said. “Work is his hobby.”

Reporter Jacob Steimer contributed.

Ames Alexander: 704-358-5060, @amesalex

Billy Graham Evangelistic Association

Franklin Graham’s role: President and CEO

His total compensation in 2013: $240,641

Mission: “To proclaim the Gospel of Jesus Christ by every effective means and to equip others to do the same.”

Number of employees in 2013: 959

2013 revenue: $106.5 million

2013 expenses: $98.8 million

Source: IRS returns and the websites of the two organizations

Samaritan’s Purse

Franklin Graham’s role: President and CEO

His total compensation in 2013: $622,252

Mission: “Providing spiritual and physical aid to hurting people around the world.”

Number of employees in 2013: 2,133

2013 revenue: $460 million

2013 expenses: $402 million

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