NEW: Lawmakers Call for Disclosure of Executives’ Pay for Nonprofits Receiving State Funds
Wednesday, May 02, 2012
With the General Assembly’s move to cut $24 million from agencies servicing developmentally disabled individuals last year, Rep. Patricia A. Serpa (D-Dist. 27, West Warwick, Coventry, Warwick) is looking to change the law so that nonprofit organizations and agencies must disclose their executives’ compensation and administrative costs when seeking contracts with the state.
“Some of these executives are making six-figure salaries,” Representative Serpa said. “It’s not my intent to embarrass or point fingers at any one agency. What I’m concerned about is the fact that in a time when we’re seeing educational and health care nonprofits sharing the burden – as evidenced with Brown University and LifeSpan’s deals with the city of Providence this week – these agencies are distributing taxpayer dollars unevenly and slighting not only the developmentally disabled, but their own employees on the front lines who work tirelessly to provide services to those individuals in need.”
The state dedicates about $215 million in taxpayer money to about 40 agencies that support and provide services to 3,600 developmentally disabled adults in Rhode Island. Representative Serpa said a bulk of those taxpayer dollars should go toward providing services and paying a fair living wage to the day-to-day providers who care for the disabled. She also noted that there are agencies that receive funding outside the state contribution, and many organizations are still threatening to cut services and staff.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTThe bill (2012-H 8020) would not allow the director of the Department of Administration to approve a contract with each of the said agencies until they have disclosed all forms of compensation for executives and administrators, including salary, deferred compensation and benefits.
“I’ve heard anecdotal evidence that some of these agencies’ top executives have taken pay cuts, and I commend them for that,” Representative Serpa said. “But I don’t think I’m wrong when I say that this is not common practice in Rhode Island. There are some agencies that at least appear to be top-heavy in administrative costs, and the evidence is in their 990 tax forms.”
Representative Serpa said any member of the public can search for a nonprofit’s financial information on Guidestar.org. With an unprecedented pension overhaul, suspended cost-of-living adjustments and other cuts enacted last year, the representative is now calling for the same standards of transparency for the nonprofits that rely on state funding.
“It’s unlikely that we are going to be able to restore that $24 million in its entirety this year,” she said. “But we’ve sacrificed so much in this grueling economy. I’m only asking that nonprofits and agencies take a second look at how they are allocating their resources.”
The legislation, which has seen widespread support from all ranges of the political spectrum, is co-sponsored by Representatives Agostinho F. Silva (D-Dist. 56, Central Falls), Cale P. Keable (D-Dist. 47, Burrillville, Glocester), Raymond E. Gallison Jr. (D-Dist. 69, Bristol, Portsmouth) and House Majority Leader Nicholas A. Mattiello (D-Dist. 15, Cranston). The House Finance Committee held a hearing on the bill on Tuesday, May 1.
