T. Kenneth Cribb Jr. earned nearly $700,000 last year as president of the Intercollegiate Studies Institute, a prominent conservative research group. Several compensation experts say Mr. Cribb’s pay, which tops that of presidents of most private research universities, is high for the leader of a relatively small nonprofit organization.
Mr. Cribb is a lawyer and influential advocate on higher-education issues, having served as a top adviser to President Ronald Reagan. Since 1989, Mr. Cribb has led the institute, a national nonprofit organization that encourages civic literacy in college students and a “better understanding of the values and institutions that sustain a free and humane society.”
Mr. Cribb’s compensation was $691,783 in 2008-9, including about $550,000 in base salary, $51,000 in retirement pay, and a $91,000 payment from a related foundation. His total compensation was up 7 percent from the $643,962 he earned the previous year, according to the institute’s federal tax filings. Mr. Cribb’s raise came as the group struggled to cope with the recession and saw a $237,000 annual operating surplus turn into a $1.4-million deficit.
Mr. Cribb declined an interview request. But Douglas C. Mills, the institute’s executive vice president, defended Mr. Cribb’s pay. During Mr. Cribb’s 21-year tenure, he said, the group has added substantially to its programs—for example, the number of lectures has increased from 150 per year to over 300, and ISI Books began operating and now has more than 160 books in print—and has seen a significant increase in revenue. In 2008-9, the institute’s total revenue was $11.3-million, twice what it was a decade ago.
“We take very seriously our stewardship of the financial resources with which we have been entrusted, while also remaining strongly dedicated to executing our mission and programs,” Mr. Mills said in a written statement.
The Intercollegiate Studies Institute is perhaps the largest nonprofit organization specifically aimed at improving civic literacy for college students. But Mr. Cribb’s pay in 2008-9 matches or exceeds that of leaders of several other well-known think tanks. Mr. Cribb’s compensation is about $20,000 higher than that of the head of the Cato Institute, a libertarian group with a budget about twice the size of the Intercollegiate Studies Institute’s. The leader of the Center for American Progress, a liberal institution with a budget about twice as big as the Intercollegiate Studies Institute’s, made $270,000—less than half of what Mr. Cribb earned.
The institute’s budget was $12.8-million in 2008-9. The average annual compensation for chief executives of charities with expenses between $3.5-million and $13.5-million was $149,000 last year, according to Charity Navigator, which evaluates nonprofit groups. Mr. Cribb’s pay was also much higher than the $462,000 average compensation of executives at the largest charity groups, those with budgets of more than $100-million.
“That’s a very significant total package for a relatively small organization with a large financial loss in that particular year,” said Raymond D. Cotton, a Washington lawyer who specializes in compensation matters.
Other pay experts say the figure is simply on the high side of an acceptable range for the longtime head of a nonprofit institution.
Voluntary Pay Cuts
Executive pay in the charity world has been under scrutiny for years, and the economic downturn has heightened public concerns. Members of the U.S. Senate Finance Committee last month blasted the Boys & Girls Clubs of America, questioning why the organization’s president, Roxanne Spillett, earned nearly $1-million in compensation in 2008, “even while local boys and girls clubs nationwide close their doors due to budget shortfalls.”
Mr. Mills said his organization was aware of its financial difficulties and the need to cut expenses. The organization recently laid off 12 of its approximately 60 employees and stopped financing its pension plan as a cost-cutting measure.
The institute’s top executives, including Mr. Cribb, have agreed to take a voluntary 10-percent pay cut for 2009-10 because of their desire to “step up and reduce budgets,” Mr. Mills said.
When first contacted by The Chronicle, the group did not disclose any further pay cuts. But in a subsequent written statement, Mr. Mills said Mr. Cribb had voluntarily reduced his salary to $456,733 for the current calendar year and would no longer receive payments from the Collegiate Network, a supporting foundation.
“Due to the challenging financial times,” Mr. Mills said, “it is more important to fund the programs than to pay himself.”
Skills and Experience
There are two forces at play for charitable organizations as they consider how much to pay their top executives, says Dennis R. Young, director of the nonprofit-studies program at Georgia State University. Like corporations, nonprofit groups need a leader who can bring in money and public support. But because nonprofit organizations receive tax breaks, many people feel they should be held to a higher standard. And the chief executive’s pay is an easy target.
“People want to feel when they give money to an organization that it goes directly to the program, that it’s not eaten up by a lot of overhead,” Mr. Young said. “So when they see ratios they don’t like—like what ratio of my money that goes to programs—they get upset.”
The Internal Revenue Service generally frowns on basing executive compensation levels on changes in the size of an institution’s assets, said Marcus S. Owens, a Washington-based lawyer with the firm Caplin & Drysdale who led the agency’s tax-exempt branch for about a decade. Instead, he said, the IRS prefers that executives “be paid for the work you do.”
Mr. Owens said that Mr. Cribb’s salary appears to be high, but that nonprofit leaders’ compensation may be tied to special job requirements. For example, an organization that does medical research may require an executive director with high technical knowledge whose research is part of the job. Length of service would also be a factor, he said, but not one “that can support extraordinary compensation.”
“Compensation of the size that’s reported there would suggest the position would require a fairly high degree of technical skill of some type,” Mr. Owens said. “In other words, the job would have to involve more than simply approving grants.”
Mr. Mills said that Mr. Cribb has the sort of experience necessary to run an enterprise as large as the institute, and that the group’s growth is at least in part due to its leader.
Mr. Cribb holds a law degree from the University of Virginia and a bachelor’s degree in French from Washington and Lee University. Prior to his current stint as the institute’s president, he served as its national director between 1971 and 1977. In addition to his roles heading the institute and the Collegiate Network, Mr. Cribb is also president of the Council for National Policy and counselor to the Federalist Society for Law and Public Policy Studies.
Mr. Mills said his institution had acted appropriately with Mr. Cribb’s pay and other financial matters. “ISI has a strong reputation with nothing to hide.”