LA homeless nonprofit paid Hawaii-based CEO over $1.6m in 2 years

A Southern California nonprofit that operates domestic violence shelters and homelessness programmes paid its chief executive more than $1.6 million over the last two years covered by its public tax filings. The unusually large compensation has drawn questions from nonprofit experts because the CEO, Carol Adelkoff, has maintained a primary residence in Hawaii while leading the Los Angeles-based organisation, according to a report by LA Times.Adelkoff is the longtime CEO of 1736 Family Crisis Center, a nonprofit that runs shelters, crisis hotlines and support programmes in Los Angeles and Orange counties. According to federal filings, she received $907,923 in total compensation in 2023 and another $742,181 in 2024, a combined $1.65 million.The organisation says the unusually high payments were largely linked to unused vacation time accumulated during Adelkoff’s four decades with the centre, rather than a sudden increase in her regular salary.What the tax filings showThe 2023 payment included a $495,000 bonus, which was larger than Adelkoff’s base pay at the time. Her usual annual salary had been approximately $405,000 in recent years, according to her explanation to the Los Angeles Times.Adelkoff said the compensation figures did not represent a permanent salary jump. Instead, she said approximately $824,000 of the combined two-year total came from the payout of vacation time accumulated over many years.“The salary didn’t jump like that,” Adelkoff said, explaining that the payments were intended to reduce the organisation’s growing liability for unused leave, reported LA Times.Kerry Garvis Wright, an attorney representing 1736 Family Crisis Center, said the board consulted legal and financial advisers before approving the payout. The organisation’s 2024 tax filing is being amended to clarify that $329,243 of Adelkoff’s compensation that year came from vacation distribution.Adelkoff has said that she has no further accrued vacation time waiting to be paid out and that her total compensation has since fallen back toward its historical level.Why experts are questioning the payoutNonprofit compensation is not automatically required to be modest. Leaders of large organisations can receive substantial salaries when they oversee complex operations, manage hundreds of employees or handle significant budgets.But federal rules require nonprofit compensation to be “reasonable,” generally based on what comparable organisations pay executives performing similar work. That standard has prompted questions in this case because Adelkoff’s compensation was several times higher than the median for leaders of comparable Los Angeles-area nonprofits.The Los Angeles Times compared Adelkoff’s compensation with the pay of executives at 16 other organisations working in domestic violence services, homelessness support and related areas. The median annual compensation among those leaders was approximately $159,737. The next-highest-paid executive in the comparison earned $423,932 in 2024.Other comparisons also showed a significant gap. In 2024, the Weingart Center Association, which reported revenue of about $89 million, paid its CEO $481,271 in base pay and bonuses. In 2023, the CEO of People Assisting the Homeless and its affiliates received approximately $379,000 while overseeing an organisation with reported annual revenue of about $175 million.Brian Mittendorf, a nonprofit accounting expert at Ohio State University, questioned whether it was appropriate for one employee to accumulate such a large amount of unused leave before receiving a payout. Laurie Styron, chief executive of CharityWatch, called the arrangement highly unusual.How the vacation accumulatedAccording to Wright, Adelkoff was originally allowed to accrue eight weeks of vacation each year as CEO. That allowance was reduced to four weeks in 2012, but the organisation did not impose the same overall cap on her accumulated leave that it applied to other employees, according to the report.The organisation said the demands of Adelkoff’s role made it difficult for her to take time away. She oversaw a growing network of shelters, clinics, hotlines and residential facilities that operated around the clock. Her responsibilities also included fundraising, community events, grant management, staff oversight and emergency service coordination.Most California nonprofits, however, place limits on how much vacation employees can carry forward, as per reports. A recent survey cited in the reporting found that 97% of responding California nonprofits capped vacation accrual. A common method is to allow employees to accumulate no more than one and a half times their annual vacation allowance.California law prevents employers from using a “use it or lose it” policy, but organisations can establish reasonable limits on how much leave employees may accumulate. Experts said paying unused vacation when an employee leaves is common, while a payout of this size while the person remains employed is far less typical.A nonprofit funded mostly by public moneyThe compensation issue has attracted additional attention because 1736 Family Crisis Center relies heavily on government funding. The organisation reported about $15 million in annual revenue and said roughly 94% of that money came from government sources, including grants from different levels of government.The centre operates approximately 16 facilities across Los Angeles and Orange counties and employs about 170 people. Its services include domestic violence shelters, crisis hotlines, programmes for people experiencing homelessness and support for vulnerable groups such as homeless veterans and teenagers dealing with depression.Since 2021, the organisation has received at least $25 million in grants from the Los Angeles Homeless Services Authority, which distributes city, county and federal funds for homelessness programmes. That public funding has made executive compensation a matter of interest beyond the organisa...