March 12, 2010 -- The Boys & Girls Club of America, a nationwide charity that receives millions of dollars in taxpayer aid, is under fire for paying out high salaries to executives such as CEO Roxanne Spillett at a time when the organization is closing clubs around the country.
A group of Republican senators, led by the Senate Finance Committee's ranking member Sen. Chuck Grassley, R-Iowa, sent a letter Thursday criticizing the non-profit organization's use of tens of millions of dollars in federal funds that it receives every year. The lawmakers are concerned the money is getting spent on perks, retirement plans, lobbying expenses and high salaries.
"It appears that such funds are not reaching the intended beneficiaries, in this case, the youth of the country," Grassley and Sens. Tom Coburn, R-Okla., Jon Kyl, R-Ariz, and John Cornyn, R-Texas, said in a letter sent to Robert Bach, chairman of the board at the Boys & Girls Club of America.
The letter specifically cited Spillett, who is also the organization's president, for raking in $988,591 in total compensation in 2008, according to IRS filings.
In a written statement released this afternoon, the Boys & Girls Club of America defended Spillett's compensation.
Mercer, an independent consulting firm that analyzes compensation, "reviewed the total cash compensation and executive benefits for Roxanne and found that it was consistent with prevailing and current market practices of similarly-situated national nonprofit organizations, and therefore, reasonable," the organization said.
According to the statement, of Spillett's total compensation, $360,774 was her base salary, which the organization said had not changed since 2006. She also received an "incentive based on performance" of $150,000 as well as benefits, expenses and contributions to deferred retirement plans totaling $477,817.
None of Spillett's compensation, the organization said, comes from federal funds.
The Boys & Girls Club of America is the umbrella group for more than 4,000 locally-governed community clubs across the country. Clubs nationwide have recently been forced to close due to a lack of funding.
The senators requested a response from Bach before March 29, as they are currently assessing a bill that would give $425 million in federal funds to the charity over the next five years. If senators are not satisfied with the response from the Boys & Girls Clubs of America, the organization's federal funds could be in jeopardy.
"The question," Grassley said in a statement, "is whether or not a very top-heavy organization might be siphoning off federal dollars that should be going to help kids."
Senators Question Boys & Girls Clubs of America
The organization's Web site boasts that the charity's "efficient use of financial resources has won national recognition." It notes that the Chronicle of Philanthropy rated Boys & Girls Clubs of America the best youth organization for more than 15 years.
The Web site also cites the fact that Forbes magazine and US News & World Report have rated the organization one of the country's top 100 charities based on financial efficiency and other factors.