This is the second in a series of articles. The introduction to the series can be found at:
The available tax data allows us to see what some of the key players at HRC are getting paid. However, it leaves a lot of unanswered questions about where the bulk of the money reported as compensation expense is going.
The data for this article was taken from the IRS form 990 filed by HRC, Inc. for the year 2008. The entire form can be viewed at this link.
HRC, Inc is the only one of the three companies that is reporting compensation expense, so it appears that all staff are managed from there.
The summary income statement reports a total compensation expense of ,540,658. This outlay represents 30% of their total revenue for the year. That makes it their single most significant expense category. They are required to provide specific disclosure of compensation for certain key and highly compensated employees. Here is the information provided in that disclosure.
That leaves quite a lot of compensation expense unaccounted for. In the more detailed income statement that is required in another part of the form they report a lump figure of ,604,722 for other salaries and wages. There is no further detail as to what is included in that figure.
Looking at the staff page on the HRC web site which appears here:
We see a total of 33 people listed by name. Of course this information is for 2010 rather than 2008. One assumes that there are other people performing more menial duties such as receptionist, accounting clerks, etc. I haven't been able to find any information about the total number of employees.
So what do we make of this 6.6 million dollars? If this were all about people who are getting paid less than the 6 figure crowd listed above we could try assuming an average salary of k. At that rate it would take troops of about 130 additional people to cover that amount. Does it take that many people to put out the hors d'oeuvres for the cocktail parties?
A very basic index for evaluating charitable organizations is the percentage of the donated funds that actually go to supporting the activities for which they were donated as opposed going to the cost of raising the funds and administrative overhead. This is an area that the IRS focuses on. They require two major pieces of reporting, the cost of contracts with professional fund raisers and the cost of fund raising events.
Here is HRC's data for the professional fundraisers.
The email and direct mail solicitations appear to have been fairly efficient. However, the member acquisition endeavors would seem to leave a bit to be desired. The caper with Telefund, Inc. looks like a real dog.
Here is the summary statement for their fundraising events. This would include the dinners and cocktail parties.
That represents about a 50% net income on cost outlays. I would not be inclined to raise any questions about that relationship.
There was one other large reported expense that I found interesting. They spent ,123,902 attending conferences and meetings. That sounds like an awful lot of boring speeches to listen to. Without more detailed information it would be difficult to really evaluate that.
The next installment in the series will examine political contributions.