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Exclusive: Nonprofit CEO cashes in on religious freedom campaign

Over the last decade, Military Religious Freedom Foundation founder and president Mikey Weinstein has become one of the most persistent and vocal activists in the military community, ferociously arguing for the separation of church and state in the military.

His compensation for running MRFF is also exceptionally large compared with top salaries at most nonprofits, military-related and otherwise — especially those the size of MRFF, an Air Force Times examination of the organization’s tax filings shows. In 2012, Weinstein received total compensation worth $273,355 — about 47 percent of all money MRFF raised through contributions and grants that year, according to IRS filings accessed on the nonprofit transparency website GuideStar.

Weinstein founded MRFF out of his own pocket in 2005, around the same time other prominent military-related nonprofits such as the Iraq and Afghanistan Veterans of America and Wounded Warrior Project began. But as the size and bank accounts of all those charities grew, Weinstein, an attorney, quickly became one of the best-compensated nonprofit executives in the country — taking a percentage of his group’s receipts that is unheard of in the military community.

IAVA, for example, paid its founder and CEO Paul Rieckhoff $145,000 in 2012, or a little more than 2 percent of the $6.1 million IAVA raised that year. Wounded Warrior Project CEO Steven Nardizzi received $311,538 in 2012, or 0.2 percent of the nearly $155 million that charity raised that year. Nardizzi was paid more than Weinstein in actual dollars, but Wounded Warrior Project’s revenues far exceed the $584,351 MRFF brought in during 2012.

Weinstein’s compensation is well more than double the typical compensation for nonprofit CEOs, according to the most recent study by the watchdog group Charity Navigator, released in October. Charity Navigator found the typical charity CEO nationwide received a median $125,942 in compensation in 2011. CEOs in the Southwest — Weinstein and MRFF are located in Albuquerque, New Mexico — received a median compensation of $119,393, the study said.

And when Charity Navigator broke out small charities — which it categorized as charities with total expenses of between $1 million and $3.5 million — it found the typical CEO received median compensation of $95,661. MRFF, which reported $582,136 in total expenses on its 2012 IRSForm 990, falls below what Charity Navigator considered a small nonprofit for purposes of that study.

“For a charity that size, I would definitely say the compensation is very high,” said Sandra Miniutti, vice president for marketing and chief financial officer of Charity Navigator.

Weinstein votes on his own salary as part of a three-member board that is smaller than the five-member board Charity Navigator recommends for nonprofits. And MRFF counts him — a paid employee — as an independent voting board member, in apparent violation of IRS rules.

In interviews with Air Force Times, Weinstein — the only compensated employee at MRFF — strongly defended his compensation as appropriate and ethical.

“I handle a lot of different hats here,” Weinstein said. “I handle all development and do all the fundraising. My wife’s a full-time volunteer and has the term development director, but I’m the one that does it. I handle all of the clients’ care and intake, and all of the interface with the clients. I handle all of the stuff with the press. It ends up being about a 15-hour-a-day workweek, seven days a week. It’s a tremendous amount of time and effort, and we feel it’s perfectly appropriate.”

MRFF’s filings list Weinstein as working 80 hours a week.

IAVA’s Rieckhoff and Wounded Warrior Project’s Nardizzi each work 60 hours a week, according to those organizations’ filings.

When asked by Air Force Times for a benchmarking analysis or other formal study MRFF conducted to review Weinstein’s compensation as compared with executives at nonprofits with similar missions, of similar size and in similar parts of the country, Weinstein forwarded an email from the group’s grants and database administrator that estimated his per-hour rate at $65.71 for an 80-hour work week, and his estimated per-hour consulting rate at $197 when administrative fees and expenses are included. An attorney with Weinstein’s experience could net $248 an hour at a law firm or other organization, the email said.

Weinstein said MRFF does not conduct a more formal study.

MRFF's founding

Weinstein graduated from the Air Force Academy in 1977, and spent 10 years in the Air Force as a judge advocate general, and more than three years as legal counsel for the Reagan administration, during which time he served as the committee management officer of the Iran-Contra investigation. After leaving the government he served as an attorney in New York City and Washington. He then served as general counsel to billionaire and former presidential candidate H. Ross Perot and Perot Systems Corp, before quitting in 2006 to run MRFF full time. His two sons, son-in-law and daughter-in-law also graduated from the academy. Weinstein said his younger son experienced anti-Semitic prejudice while attending the academy in 2004, after the movie “The Passion of the Christ” was released. He said cadets were being pressured to see the movie, and he founded MRFF soon afterwards.

Weinstein said MRFF has assisted more than 37,600 clients in total since it was created, and said his organization helps roughly 300 to 600 people per month.

Weinstein’s fierce and combative style — as well as his tendency to rail against fundamentalist Christianity and call his opponents “Christian Taliban” — have made him deep enemies on the religious right. And his salary has been cited by his critics. In a June newsletter online, Focus on the Family founder James Dobson blasted Weinstein as a “bitter man” who “receives a huge salary from MRFF” for “filing, and usually losing, bogus lawsuits” against Christians. Online commenters occasionally reference his pay. And one white supremacist website wrote a blog about his salary in 2012.

Weinstein also regularly receives, due to his activism, hate emails full of anti-Semitic language.

“Our reputation is being militant and aggressive,” Weinstein said. “It’s a full-contact sport.”

Since 2008, Weinstein’s compensation has ranged from a high of $296,232 in 2009 to a low of $218,201 the following year, varying between 34 percent and 54 percent of total revenues collected by MRFF.

Record of successes

In addition to his lengthy workweek, Weinstein points to MRFF’s track record of successes. A 24-page document provided by MRFF lists 71 of its accomplishments over the last three years, including representing two Muslim soldiers who were allegedly harassed for their faith, the Air Force’s adoption of Air Force Instruction 1-1 requiring airmen to remain neutral toward religion, getting the Air Force Academy to remove a poster from its prep school containing the phrase “so help me God,” getting Nativity scenes at Shaw Air Force Base, South Carolina, and Guantanamo Bay, Cuba, relocated, and getting a cadet leader at the Air Force Academy to remove a Bible verse from a whiteboard outside his dorm room.

MRFF in 2011 also exposed the presence of Christian-themed course work in an ethics course for new Air Forcenuclear missile officers and ROTC cadets, leading the service to pull the nuke course and review all training materials related to ethics, core values and character development.

“It’s very hard to argue with the success we’ve had,” Weinstein said. “We’ve had [salary] criticisms for years [but] we’ve never, ever had a complaint from a donor or from any of our clients out there. There’s nobody else that does what we do. There’s literally nobody else.”

Weinstein cited MRFF’s recent inclusion for the second year in a row as part of the Combined Federal Campaign, the federal government’s annual charity drive.

“We think it’s completely ethical, and so apparently does the Combined Federal Campaign,” Weinstein said of his compensation.

Miniutti said a nonprofit’s presence on the list of approved CFC charities can’t in and of itself be taken as evidence that the nonprofit is being run properly.

“The CFC does no vetting,” Miniutti said.

The norm

Miniutti said that most sub-$1 million charities pay their CEOs an average compensation of around $100,000.

When asked about Charity Navigator’s compensation estimates for smaller charities, Weinstein said, “I don’t know whether the other charities have six Nobel Peace Prize nominations, but we do.”

MRFF regularly announces its Nobel Peace Prize nominations, but typically does not say who nominated it, aside from saying its nominator is one of the founding members of a Nobel Peace Prize-winning international humanitarian organization. After several inquiries from Air Force Times, Weinstein said MRFF was nominated by Bobby Muller, the co-founder of the International Campaign to Ban Landmines, which won the Nobel Peace Prize in 1997. Muller is also a member of MRFF’s advisory board, a Vietnam veteran and president of Veterans for America.

In an interview, Muller said he nominated MRFF for the Nobel prize not only because its mission of ensuring the separation of church and state is important, but also because Weinstein, who is Jewish, continues his work despite regularly receiving threatening, anti-Semitic emails and occasional vandalism of his home. Weinstein said an unknown person or persons left a dead animal at his house on June 16.

“I don’t know how the guy goes on,” Muller said. “I think this guy is an American hero. I don’t think people understand how serious this issue is, and Mikey is a pioneer in exposing this.”

Muller said he is not concerned by Weinstein’s compensation package. The sheer amount of time, energy and passion he displays for his work makes him indispensable to MRFF, Muller said. And he has security concerns related to his work, Muller said.

“The organization, to me, is basically Mikey and his advocacy,” Muller said. “I don’t think you could find a replacement for him.”

Muller said Weinstein used his own personal funds to start MRFF in its early days, and that it’s appropriate that he recoup some of those funds now that the organization is better-established.

In an email, Weinstein said he put “multiple hundreds of thousands of dollars over several years” to help bring MRFF into being.

Questionable practices

Contrary to accepted best practices in the nonprofit community, Weinstein votes on his own compensation — a fact that becomes especially concerning in light of his unusually large compensation.

“Wouldn’t you love to set your own salary?” Miniutti said. “That’s definitely not a normal practice. There’s a huge conflict of interest there, and he should not be participating in the vote on his own compensation.”

MRFF contains a voting board of three members — Weinstein, former Ambassador Joseph Wilson and retired Marine Corps Maj. William Barker — whom the organization’s filings list as “independent” voting board members. Weinstein confirmed in an interview that he votes on his own compensation package.

“I’m a voting member, so yes, I wouldn’t be excluded from that,” Weinstein said.

When asked how he can be considered an independent voting board member while also being paid by MRFF, Weinstein said the board has never had any objections to him voting on his own salary.

“Our entire board sees everything every year, sees all of the documentation,” Weinstein said. “Our guys are well aware of what I make. Everyone in the world sees what I make. The religious right has criticized it forever.”

The IRS’ Form 990 instructions specifically say a member of a nonprofit’s governing body cannot be considered independent if he is compensated as an officer or other employee. IRS instructions also say that an organization that files returns with incorrect information can draw penalties of up to $10,000 per return.

“It sounds like there’s been a breakdown in the process, that they don’t have a truly independent board honestly reviewing CEO compensation and ensuring it is reasonable, which is the IRS standard,” Miniutti said. The MRFF’s current board structure “is definitely not a best practice.”

Charity Navigator recommends nonprofits have at least five independent voting board members, who are not paid employees or family members.

“We don’t let the Charity Navigator tail wag the MRFF-mission-or-success dog,” Weinstein said when asked about that recommendation. “We have a very good size advisory board with a lot of people who are very intelligent who have had an awful lot of success in life. Not one of them has ever had a problem with the size of our board. It is not important to us to please Charity Navigator.”

Miniutti said it appears there is a lack of sufficient, independent oversight of MRFF leadership.

“Nobody’s really keeping an eye on the organization, making sure it’s fiscally responsible and delivering on its intended mission,” Miniutti said. “It’s concerning to see such a small board with such a highly compensated individual. Sometimes it takes time to build a board. But almost 10 years in existence, you would expect by now to see a more diverse board in place.”

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