In 2009, Joel and Phillip Levy pocketed $2 million between them annually as leaders of a Medicaid-funded nonprofit serving the developmentally disabled. The Levys used tax dollars to purchase multiple homes, luxury cars, pay their kids’ college tuition, and support family members’ living arrangements in NYC. The misuse of public dollars violates the public trust. It makes us angry—and it should.

In January 2012, New York Governor Cuomo issued an executive order to limit executive pay and established a commission to investigate excessive nonprofit compensation. Now Cuomo and Attorney General Eric Schneiderman have announced proposals to regulate nonprofit executive compensation.  Schneiderman’s proposal–the “Nonprofit Revitalization Act”—was just introduced by Senators Carl L. Marcellino and Michael H. Ranzenhofer. Many of the elements reflect recommendations from the statewide task force (discussed in an earlier blog here).

Governor Cuomo’s proposal calls for a salary cap to limit the amount of state dollars applied to executive compensation to $200,000. His proposal also includes options for waivers to surpass the cap if an organization can justify the difference (hospital executives, for example, often have salaries well above seven figures and argue that this is required in the competitive health care market). Read more »