Executive Compensation at the School Nutrition Association

The School Nutrition Association (SNA) is a non-profit 501 (c) (4) national organization of school professionals that provide education and advocacy for its members in an effort to improve the quality of school meal programs. A 501 (c) (4) is a social welfare organization who can engage in advocacy and lobbying. Businesses and unions can donate unlimited amounts to 501 (c) (4)’s and the donations are not tax-deductible.

Based in National Harbour, Maryland, the SNA reported $11.8 million in revenue for the year ending July 31, 2016 (hereafter referred to as “2016”) on the Form 990 submitted to the IRS.

The $11.8 million in revenue derived from five sources:

• $5.1 million (or 43% of revenue):  Meetings and Education
• $2.7 million (or 23% of revenue):  Membership Dues
• $2.2 million (or 19% of revenue):  Advertising
• $ .9 million (or 8% of revenue):  Contributions, Gifts, and Grants
• $ .6 million (or 5% of revenue):  Certification and Program Service Revenue
• $ .2 million (or 2% of revenue):  Investment Income, Royalties, Gain/Loss on Sale of Assets

It is important to note there is a School Nutrition Foundation (that receives most of its funding from the Food Research and Action Center (FRAC)) who gives about $100,000 annually – not a significant source of revenue – to SNA. The President of the School Nutrition Foundation is Patricia Montague, who is also the CEO of SNA. She received about $40,000 in 2016 from the School Foundation in addition to nearly $400,000 in compensation from SNA.

Total expenses in 2016 were reported to be $11.2 million and can be viewed two ways: by broad category (i.e. program services, grants, management, and fundraising) or by specific line item category (i.e. compensation-related, office-related, travel and conferences, etc). However, the SNA is not involved in fundraising or in awarding grants so there are no expenses in these two areas. Each way is beneficial with the former providing a general overview while the latter provides more specific information of how revenue was spent.

Expenses by Broad Category (Program Services and Management)

The $11.2 million in expenses were reported in the following two categories:

$ 7.2 million (or 61% of revenue): Program Services

$ 4.0 million (or 34% of revenue): Management Expenses

As illustrated above, $7.2 million or 61% of revenue was spent on program services while $4 million or 34% of revenue was spent on management. $0.6 million was unspent and placed in net fund assets which had an $8.3 million balance at year-end, compared to $7.7 million the prior year.  Almost all of the $8.3 million is unrestricted.

Expenses by Specific Line Item Category

The $11.2 million in expenses were reported in the following specific line item categories:

• $4.7 million (or 40% of revenue):  Compensation-related Expenses
• $2.9 million (or 24% of revenue):  Travel and Conference
• $1.6 million (or 13% of revenue):  Other Fees for Services and Other Expenses (no detail provided)
• $1.3 million (or 11% of revenue):  Office-related Expenses
• $ .3 million:  (or 2% of revenue):  Fees for Services (Legal, Accounting, Lobbying, Investment Management)
• $ .3 million (or 2% of revenue):  Advertising, UBIT
• $ .2 million (or 2% of revenue):  Payment to Affiliate

As illustrated above, the largest expense for SNA was the $4.7 million to compensate the 54 employees, which equates to $87,000 each. However, 9 individuals received more than $100,000 in compensation and are listed below:

• $378,388:  Patricia Montague, CEO
• $195,320:  Catherine Schuchart, SVP Government Affairs and Media Relations
• $192,547:  Jennifer Lewi, SVP Membership and Marketing
• $176,359:  Jean Geraghty, Chief of Staff
• $171,134:  Sherry Carrigan, SVP Business Development and Meetings
• $161,492:  Marcelo Esquivel, Director of Information Technology
• $152,881:  Kimberly Williams, SVP Finance and Technology
• $128,959:  Diane Pratt Heavner, Director of Media Relations
• $127,226:  Patricia Fitzgerald, Senior Director Digital and Print Communication

As illustrated above, $1.7 million in compensation was provided to the nine staff, eight of whom are female and one a male.

$2.9 million was spent on travel and conferences while $1.6 million was paid to outside individuals or organizations including 14 individuals or organizations that received more than $100,000. The most highly compensated were:

• $411.334:  Barbara Boyce of Aurora, Colorado for advertising sales rep
• $396,211:  RR Donnelly of Strasburg, VA for monthly magazine printing and distribution
• $368,285:  Freeman Audio Visual of Dallas, TX for audio-visual equipment services
• $296,421:  Next Level Productions and Talent of Lake Orion, MI for talent management

Using the above information, $100 in revenue was spent as follows:

$100:  Revenue

-$ 40:  Compensation-related Expenses

– $ 24:  Travel and Conference

-$ 13:  Other Fees for Services and Other Expenses (no detail provided)

-$ 11:  Office-related Expenses

-$  2:  Fees for Services (Legal, Accounting, Lobbying, Investment Management)

-$  2:  Advertising, UBIT

-$  2:  Payment to Affiliate (not named)

-$ 94:  Total Expenses

$   6:  Amount Remaining: To Fund Balance

As illustrated above, SNA spent $94 out of every $100 in revenue the organization collected and saved $6.

In summary, the SNA is a professional non-profit that serves the people working in the nation’s school meal programs. They appear to be an organization that derives most of their revenue from conferences, membership dues, and advertising in their publications. Accordingly, their staff costs are a significant expense (including the CEO who received about $420,000 between the Association and the Foundation) as are the travel and conference costs.

To read the IRS Form 990 (2015), click here.