Properties of Merit's board has cut Executive Director Sam Bennett's six-figure salary in half and asked a consultant to review how the Allentown nonprofit arrived at her pay after a Morning Call report questioned the process it used.

Bennett, also a Democratic candidate for Congress in the 15th District, said in a statement Thursday that the decisions by the board Wednesday night to reduce her annual pay to $55,000 came at her request in an effort to avoid controversy surrounding her $110,000 salary.

"I am very concerned that this situation might put a cloud over Properties of Merit at this important time when [the organization] is expanding statewide," Bennett said.

And while she defended the process the board used to establish her pay, she asked it to hire a consultant to "review the process and decisions regarding compensation to confirm that they are above reproach, and to abide by any changes recommended."

The Morning Call reported earlier this month that the organization's 12-member board had gone against Internal Revenue Service guidelines when deciding Bennett's salary last year. The board selected Bennett to be on a three-person compensation committee that would make a salary recommendation to the full board. Also, the organization chose not to look at budget size when comparing itself with other organizations and what their executives earn. Finally, the organization put itself in a category with nonprofits that employ more than 100 staffers under the rationale that it expects to have at least that many volunteers. Bennett is one of two employees at the organization.
In an interview in late June, Bennett defended her role on the compensation committee and the comparison process used by the board to set her salary. She said she did not discuss what salary to recommend to the board, nor did she vote on her compensation.

"I had nothing to do with picking my own compensation," Bennett said. "That wouldn't be appropriate."

She declined to comment further Thursday.

Board President Jim Molchany said in a statement Thursday that board members "appreciate" the requests by Bennett.

"We believe that they show that her priority, as ours, is to further our mission and help make Pennsylvania communities better," he said. Reached for comment Thursday, Molchany declined to elaborate on the board decision. In an op-ed published in The Morning Call last week, he said the IRS guidelines were "complied with fully" and that the board stood by its decision on Bennett's pay.

That unanimous board decision came last September, shortly after the organization was awarded a state grant for $100,000 for each of three years to take its programs statewide. The infusion of cash led the nonprofit, which rewards homeowners who take exceptional care of their properties with a reception and small gifts, to reorganize itself, hire a two-person staff and find office space for the first time.

The $110,000 salary it established for Bennett, though, was higher than that for the top executives at most similar organizations based in the Lehigh Valley, whether measured by type or size.

The organization's 2007 expenses are budgeted at $351,000. The most recent tax filings show that no Allentown, Bethlehem or Easton-based nonprofit with expenses of less than $500,000 pays its top executive more than $100,000, according to GuideStar, which runs the largest database of nonprofit organizations.

Bennett, a two-time Allentown mayoral candidate who previously ran the Mayfair Festival of the Arts, said in June that the organization is unlike others based in the Valley, though, because of its statewide mandate. She said it could soon be running programs in more than 100 municipalities throughout Pennsylvania.

In April, Bennett declared her candidacy for the congressional seat held by Republican U.S. Rep. Charlie Dent. The district spans Lehigh, Northampton and parts of Montgomery counties.
In her statement Thursday, she referred to her campaign as central to her request for a salary reduction.

"I hope that these decisions will remove [Properties of Merit] and its mission from the political arena, where they do not belong," she said. "It is my hope that these decisions, which are mine alone, will merit that confidence."

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