Goodwill Omaha executive pay: An investigative series

By Henry Cordes and Matthew Hansen
Illustrations by Matt Haney

Executive pay is high at Goodwill Omaha — higher than at other Omaha nonprofits, and higher than at most comparable Goodwills around the country. That leaves less store revenue to serve those in need.

Day 1: Sunday, Oct. 23

No culture of thrift »

Federal tax records show that Omaha's Goodwill in 2014 paid CEO Frank McGree total compensation of $933,444.

And McGree is far from the only executive at the Omaha nonprofit taking home enviable pay. Tax records show Omaha's Goodwill that year paid salaries of $100,000 or more to 13 of its executives and managers — a number that increased to 14 last year.

It turns out that out of the millions Goodwill Omaha generates each year selling your donated goods, the charity puts more of those dollars into pay for its leaders than it does the jobs programs that are the basis of its nonprofit mission and tax-exempt status.

No culture of thrift »

Hansen: Money-making repackaging deal benefits from cheap labor »

A Goodwill Omaha effort to raise money by repackaging hair rollers for a private company appears to violate federal rules for "Made in America" labeling.

A deep bench of well-paid executives »

Goodwill does need to attract and retain leaders who know the business world, but local experts on nonprofits are taken aback at the generous level of compensation. After all, the Omaha charity is a nonprofit.

Day 2: Monday, Oct. 24

More thrift at other Goodwills »

A World-Herald analysis of IRS tax filings found Goodwill Omaha spends a higher percentage of its budget on CEO compensation than almost any large Goodwill affiliate in the country.

Both Goodwill Omaha and Iowa City-based Goodwill Industries of the Heartland boast 17 stores in their regions and post similar annual sales. But the Iowa City CEO's annual pay is more typical of what's seen in the nonprofit world and less than half of McGree's.

And the real kicker: The Iowa City Goodwill affiliate last year put $2.3 million of its thrift store profits into supplementing the job training and assistance programs that are at the core of its mission. That's more than four times the figure for Goodwill Omaha.

More thrift at other Goodwills »

Hansen: Ex-workers in Omaha say hiring disabled workers took a back seat to profit-making »

Interviews with the former employees reveal a deep frustration that starts with money — specifically, the six-figure salaries for the CEO and other executives — but then dives much deeper into what they see as the nonprofit's broken culture.

Goodwills face few limits on CEO pay »

Big salaries, bonuses and lucrative retirement packages at some Goodwills are funded by revenue from the charity's signature thrift stores. That compensation doesn't face the same scrutiny it would if funded by government dollars or private donors.

Low wage for the disabled has fewer defenders »

Some Goodwills and other organizations have stopped paying workers with disabilities less than the minimum wage. Despite the lucrative salaries of its top executives, Goodwill Omaha continues the controversial practice.

Goodwill Omaha CEO Frank McGree appeared before the Douglas County Board in May and successfully argued the charity should keep the property tax exemptions on its Omaha stores.

But several members of the board now say they might have thought differently about the request had they known McGree was paid nearly $1 million in 2014

Three said they voted for the tax exemptions with the belief the charity was putting its thrift store proceeds to good use in its mission of serving the disabled and others facing barriers to employment — something they now question in light of The World-Herald's investigation of Goodwill.

'Outrageous and wrong': County officials wonder if charity still deserves tax exemption »

Hansen: Goodwill has let down a loyalist — 'How are you going to fix this?' »

"I'm shocked, I'm so disappointed, I'm so disgusted, I'm a social worker!" she yelled rapid-fire, then gathered herself for a moment. "I don't even have words for this," she said. "But I'm sick. This just makes me sick."

Family ties among Goodwill Omaha executives raise trust concerns »

Several leaders of Goodwill Omaha are related to others in management. Regardless of the quality of their work, an official with a national charity watchdog said nonprofit organizations that rely on donations from the public should avoid questions of favoritism that could lead to public doubt.