This is What "Excessive" Looks Like

The Chronicle of Philanthropy has a brief mention this week of a settlement between the state of New York and officials of the William T. Morris Foundation over some alleged excessive compensation at the foundation. I was unfamiliar with what had happened at the Foundation, and despite much posturing over excessive compensation at non-profits by some elected officials, I don't remember anyone ever doing anything about it, so I went back and pulled the records to determine the specifics of this case.

First of all, this case was a by-product not of some big-time investigation by the AG's office, but because the Boston Globe wrote an expose of the worst foundations in the country. The investigative method used by the Globe? Yep, they pulled up the 990s. No one was even bothering to hide these excesses, reporting them as required. Anyone interested in starting "Foundation Navigator?"

Secondly, when the AG says the pay was "excessive", I think we can all agree that, in this case, they're on pretty solid ground. I don't know where to draw the line myself, but as Justice Potter Stewart famously said of pornography, "I know it when I see it." The foundation was shrinking and spending most of their funds not on grants, but on rewarding their insiders. Edward Antonelli, the foundation's 86-year-old president, was making a million dollars a year, despite the fact that at the time, he "rarely (left) his apartment." His "portfolio manager" Amol Patil was making a much more reasonable $100k, except it doesn't seem so reasonable, when you know that Mr. Patil told the Globe that he was actually Mr. Antonelli's "driver." In addition, the board (almost always volunteers) was clearly being paid.

Thirdly, I do think it's relevant (and sad) that all that happened here is that the state of New York and the offending foundation officials reached a cash settlement. No one's going to jail. There are no further penalties. Basically, all they have to do is give back the final year of excessive pay they received. They get to keep everything they hoarded in the previous years. I'm glad the state got a few bucks, but I don't suspect this type of punishment is going to deter any future betrayers of the public trust.