Executive Compensation at the National Association of Manufacturers (2019)

The National Association of Manufacturers (NAM) is a tax-exempt, non-profit advocacy group (trade association) representing more than 14,000 manufacturing companies. Based in Washington, DC, NAM is primarily engaged in lobbying for policies in all areas that affect labor and employment in manufacturing.

The governing body has 198 voting members (board members), 197 of whom are independent.  163 of the 198 (82%) board members are male while 35 of the 204 (18%) are female.

In the most general terms, NAM is a trade association that collects about $50 million annually.  They have not historically been an organization with a strong balance sheet, meaning NAM has not had a large endowment to rely on.

In 2013, NAM had $6 million in net assets which was reduced to $2 million in 2014 and then into a negative position since then. At the end of 2019, NAM had a negative $10 million in net assets, which appears to be because NAM has been spending more than they have been raising.

In 2019, NAM reported total revenue of $60 million (compared to $51 million in 2018), most of which came from 3 sources: member dues ($38 million), advocacy and litigation ($15 million), and sponsorship, programs and affiliation fees ($6 million).

Expenses totaled $60 million in 2019 with the two largest expenses reported to be compensation ($31 million) and fees for outside services ($8 million), which are described as “retained specialists” and “other fees for services.”

187 employees received $31 million in compensation which equates to an average compensation of $166,000. However, only 79 employees received more than $100,000 in compensation with the 12 most highly compensated reported to be:

• $3,659,108:  Jay Timmons, CEO
• $  768,715:  Aric Newhouse, SVP, Policy and GR
• $  728,348:  Jeff Pierce, SVP, Membership and SD
• $  680,239:  Tod Boppell, COO
• $  653,728:  Linda Kelly, Secretary
• $  625,252:  Erin Streeter, SVP, Communications
• $  459,605:  Keith Smith, SVP, External Relations
• $  418,044:  Adria Brockman, VP, Memberships
• $  385,548:  Jordan Stoick,  VP-GR
• $  382,427:  Ross Eisenberg, VP, ERP
• $  377,036:  Linda Dempsey, VP, IEA
• $  338,814:  Christopher Netram, VP-Tax

The 12 most highly compensated employees (representing 6% of total employees) received early $10 million in compensation or 32% of total compensation. 8of the 12 (67%) are male while 4 of the 12 (33%) are female.

The most highly compensated employee was Jay Timmons, the CEO who received nearly $3.7 million in compensation in 2019.  Over the past 5 years, Mr. Timmons has received $18 million in compensation:

• 2019:  $3,659,108
• 2018:  $3,642,910
• 2017:  $3,226,846
• 2016:  $2,996,360
• 2015:  $4,299,360

$500,000 was put into the 457 (F) retirement plan of Jay Timmons (which appears to occur annually).

NAM paid for first class or charter travel. Specifically, the CEO is permitted to fly first class.

NAM paid for social or health club dues and/or initiation fees.  Specifically, the CEO is reimbursed for club dues, which are grossed up to cover the tax liability.

29 independent contractors received more than $100,000 in compensation. The 5 most highly compensated were reported to be:

• $4,974,546:  Herald Group, of Washington, DC for consulting
• $  983,779:  Locust Street Group, of Washington, DC for consulting
• $  966,500:  DDC Public Affairs, of Washington, DC for consulting and lobbying
• $  813,285:  DCI Group AZ LLC, of Washington, DC for consulting
• $  736,385  :  FTI (SC) Consulting, Inc. of NY, NY for consulting

$8 million was used to compensate outside service providers – primarily consultants and lobbyists.  However, and as indicated above, more than $8.5 million was used for consulting services. So, there appears to be a discrepancy between “fees for services non employees” and the amount actually paid to outside independent contractors.

In conclusion, NAM raised nearly $60 million and spent $60 million in 2019.  Even though NAM had $1 million in normalized gains on investments, the organization had more than $3 million in pension charges which further deteriorated the organization’s net asset position to -$10 million – all while the CEO received compensation of $3.7 million and traveled first class on NAM’s account.

To read the IRS Form 990 (2019), click here