N.J. governor wants caps on pay for nonprofit CEOs

TRENTON, N.J. (RNS) Gov. Chris Christie is seeking to limit how much the state is willing to pay for CEO salaries and employee benefits at nonprofit social service agencies that do business with the state. Beginning July 1, the state would cap the salaries of the top-earning executives at $141,000 for any social service agency […]

TRENTON, N.J. (RNS) Gov. Chris Christie is seeking to limit how much the state is willing to pay for CEO salaries and employee benefits at nonprofit social service agencies that do business with the state.

Beginning July 1, the state would cap the salaries of the top-earning executives at $141,000 for any social service agency with a budget over $20 million, according to a Department of Human Services draft memo dated April 16 obtained by The Star-Ledger.

Executive directors who oversee budgets between $10 million and $20 million could receive no more than $126,900 in state compensation. Those overseeing a budget between $5 million and $10 million would get $119,850 a year from the state, and those with a budget below $5 million would get $105,750, according to the memo.


At least 32 executive directors at community nonprofits made more money last year than the new structure would allow, according to a 2009 analysis by the Office of Legislative Services.

Among the 45 agencies with an annual budget below $9.9 million, 17 paid their CEOs in excess of the proposed salary limit. All of the executives, whom the analysis did not identify, would either have to take a pay cut or have the difference in their salaries made up through fundraising, under the administration’s proposal.

The state would save about $5 million by paying less money in CEO salaries, as well as cutting back on travel, education, severance, and vehicle expenses for all nonprofit employees, said Nicole Brossoie, spokeswoman for state Human Services Commissioner Jennifer Velez.

The department relies on private agencies to serve more than 1 million needy families and people with mental illness and developmental and physical disabilities. In most cases, these agencies receive almost all of their funding from the state.

“In light of the state’s fiscal challenges, the department has been exploring cost efficiencies in every part of our budget,” Brossoie said. “The department’s continued goal is to ensure that state dollars are being spent in the most efficient ways.”

Social service agency executives and the lobbyists that represent them said they worried that cuts to salaries and benefits would make it harder to attract and retain skilled employees. The agencies hope to negotiate a compromise before the new fiscal year begins July 1.


Richard Mingoia, president and CEO of Youth Consultation Services, the largest mental health service provider in the state for children, said he doesn’t understand why the state is singling out CEOs from community social services agencies.

“If they are going to apply these rules, they ought to apply the rules across the board — to corrections, transportation, food service, counsel for bond deals,” Mingoia said. “They should include for-profits that do business with the state.”

Donate to Support Independent Journalism!

Donate Now!