Local charities push for action

The Charlotte region's United Way declined Friday to release documents concerning Gloria Pace King's compensation, even as local charities pushed the agency to address public anger over its CEO's pay.

The agency's refusal comes amid growing fears that the outcry will hurt this year's annual fundraising drive.

“We've all had the phone calls from United Way donors who say they're not giving anymore,” said Jane McIntyre, head of the YWCA Central Carolinas.

“They're pretty mad.”

Just days after the first stories on King's pay appeared, the CEOs of some local charities met with the United Way's executive board to express their concerns, said Brett Loftis, head of the Council for Children's Rights. “If there's any negative effect on the campaign, it will be children and families in need who suffer the most,” he said.

Last year, the agency raised $45.3million. Almost 100 agencies across four counties rely on the money.

King made $365,000 in salary and bonuses in the budget year ending June 2007. Public outrage has centered on some $822,000 paid into her retirement fund.

The United Way board calls it a one-time “catch-up” to make up for past retirement contributions never made.

King is expected to get retirement contributions between $425,000 and $500,000 for the next three years – when she can retire. She has declined repeated requests for comment.

Her board members defend the package, calling it fair pay for one of the nation's top United Way leaders.

Charity Navigator, which critiques charities' performance, gave the local United Way high marks for efficiency.

United Way of America statistics show the Charlotte agency raises more money annually than all but 17 of its counterparts.

It ranked fifth in per capita giving, according to national statistics, and No. 2 in the number of donors giving at least $10,000.

This year's campaign has already begun.

Former United Way board chairman Ned Curran said the board set King's pay after studying salaries of other local nonprofit organizations, as well as those of nonprofits and United Way agencies around the country.

When asked for a list of the groups used in the comparison, as well as some other documents, Curran declined, citing the confidentiality of the information the board received.

The agency is not legally required to release the information. But its refusal runs counter to practices by the United Way of America, the umbrella group for more than 1,200 United Way agencies, including the one in Charlotte.

In its 2005 tax filing, the national organization specified the nearly two dozen charities it used in evaluating its CEO's base salary of $405,000.

Told of the national group's stance, Curran said: “I can't speak for the United Way of America. I don't think it's appropriate for us to share that information.”

Myra Clark, executive director of the Center for Community Transitions, said she'd like to see the numbers. Her group, which helps ex-convicts re-enter society, expects to receive $136,000 from United Way this year.

“I wish they would release more data to us and to the public,” she said. “I am kind of angry about the way it's come out, because it hurts the small agencies.”

Much of the uproar stems from the more than six-fold increase in King's retirement contribution.

As a United Way employee, King is eligible to receive 60percent of her salary and bonus upon retirement.

The board created a “Supplemental Executive Retirement Plan” for King in 2006 because her pension had been capped by federal tax law. Companies often create additional retirement plans for high-paid executives.

According to the agency's tax filing, King's additional retirement plan was intended to start in 2001 but didn't. It's unclear why. As a result, future contributions will be larger “than they would have been” to make up for the lost years, the tax filing says.

Curran said it would be wrong to describe the higher payments as correcting an error. He also said it is “incorrect to assume the board should have done something earlier.” But he acknowledged that spreading out the payments would have been better.

Curran said he didn't know the date when the board realized King's retirement contributions hit the tax cap.

He declined to provide specifics for why the board decided not to act at that time, even though the delay had the effect of understating King's total compensation on public tax filings by about $75,000 annually since at least 2001.

Curran said the board wants to be responsive to questions from charities, donors and the media, acknowledging the agency has lost trust among the public.

But he declined to release documents that could provide details related to King's pay and benefits, including:

A copy of King's original compensation agreement.

Copies of minutes from board meetings between Jan. 1, 2000, and Dec. 31, 2003.

Copies of studies by the board examining executive pay offered by other groups.

One national expert on charities said CEO pay can quickly and deeply damage donors' faith in a nonprofit organization.

“The trust is a critical factor,” said Ken Berger, executive director of Charity Navigator, a watchdog group that studies nonprofits. “You can't just make a pronouncement and walk away and expect to keep the trust.”

Lauren Mullis at Arc of Mecklenburg, which supports people with cognitive disabilities, said she is “just nervous” about donor anger. Her group relies on United Way for about 75 percent of its budget.

“Do I wish that it didn't happen this way? Sure, absolutely,” she said. “Am I angry about it? No, because what good would that do?

“I now have to focus on getting the message out that the United Way does so much good.” Staff writer Nancy Wang contributed.