by When looking at compensation, you have to look beyond mere salaries and bonuses. Total compensation includes both salaries and bonuses but it also includes things like deferred compensation, group life insurance, contributions to retirement plans, and taxable personal expenses.
I was finally able to get a copy of the 2018 Form 990 for the National Rifle Association. This is the tax report that all not-for-profits must file with the Internal Revenue Service. Both 501(c)(3) and 501(c)(4) organizations are included in this category. The NRA itself is a 501(c)(4) which allows it to engage in political campaign activities while the NRA Foundation is a 501(c)(3) and is not allowed to engage in political campaign activities.
Below is a table of the 12 most highly compensated NRA officials ranging from Wayne LaPierre at the top to Director of Education and Training Eric Frohardt at the bottom. If you click on the icon on the bottom right of the embedded spreadsheet, it will open the full spreadsheet.
In the notes of page 3 of Schedule J of the Form 990 is this explanation of how compensation is determined.
Compensation of the NRA’s top management officials is established by methods including independent compensation consultants, compensation surveys and studies, and comparability data. In addition, under the NRA Bylaws compensation of certain elected officials (including the Executive Vice President) must be approved by the Board of Directors, based on recommendations by the compensation committee. All decisions are properly documented.
I have posted the 2018 Form 990 here for reference.
Since comparability data is one criterion used in establishing these officials compensation, I thought I’d look first at publicly traded firearms companies to see how they compensated their top managers. Their compensation is divided into two portions: cash compensation and equity (or stock) compensation. Equity compensation is used to align the interests of managers with that of stock holders.
At Sturm, Ruger and Company, CEO Chris Killoy had a 2018 salary of $500,000 with a profit sharing bonus of $60,324 and a performance bonus of $503,000. His total cash compensation was $1,063,324. Stock awards raised his total compensation to $2.1 million. Killoy manages a company with over 2,000 employees with plants in three states. By contrast, the NRA has somewhere between 500 and 1,000 employees. The base salaries of the other top managers at Ruger ranges from $240,000 to $325,000.
James Debney, CEO of American Outdoor Brands Corporation, had a higher salary in 2018 but no cash bonus. His cash compensation was his salary of $734,039. He did receive a substantial stock award which raised his total compensation to $2.2 million. He manages a workforce of 1,853 employees. Meanwhile, the base salaries of American Outdoor Brand executives range from a low of $283,000 to a high of $402,000 for the CFO.
When you look at other politically active 501(c)(4) organizations like the Sierra Club and Planned Parenthood, the compensation of their executives is substantially less than that of the NRA. For example, Cecile Richards who was the CEO of Planned Parenthood had a total compensation of $1,033,274 from all sources. Meanwhile, the Sierra Club paid Executive Director Michael Brune a total of $333,797 and their CFO about $250,000.
When looking at the compensation of the top managers of the NRA, it is critical to look beyond Wayne LaPierre and Chris Cox. Those two are (or were in Cox’s case) very highly compensated as you might expect. However, it is the salaries of next level down that are really concerning.
Who in their right mind could justify paying Josh Powell over $900,000 with a base salary greater than the CEO’s of either Ruger or American Outdoor Brands? Powell is the guy responsible for the debacle of NRA Carry Guard, the guy the NRA spent money on to settle his sexual harassment problems, and the guy who has run multiple companies into the ground. It is ridiculous!
When you compare the salaries of the managers one level down from Wayne to that of virtually any comparable manager in a publicly traded small cap company, there is no comparison. The NRA managers are compensated beyond the level of their position and responsibility. If I had to hazard a guess, they are being compensated as much for their loyalty to their master – Wayne – as for the work that they actually do. This is just not right and sadly I see no change coming in the near to mid future.