Monday, December 27, 2010

As Freedom Forum finances sank, foundation paid millions to oldest members of its board of trustees

Freedom Forum paid millions of dollars in compensation to the longest-serving members of its governing board of trustees during the decade the journalism foundation depleted its endowment for a costly expansion of the Newseum, its Washington museum about news history, public documents show.

The museum has become a growing financial burden for Freedom Forum. In 2009, its annual operating costs reached a staggering $92 million, or $250,000 a day. That was far above the $36 million, or $99,000 a day, just two years before. The expansion into new quarters cost $450 million, nearly twice initial projections, and wasn't completed until 2008 -- years late, based on the most optimistic timetable.

Following are the seven current trustees who also were board members in 2000, when the museum project started. Dollar amounts reflect their total Freedom Forum and Newseum compensation through 2009, according to the documents.

Charles Overby
Chairman and CEO, Freedom Forum; CEO, Newseum

Peter Prichard
retired USA Today editor and Newseum president

Malcolm Kirschenbaum
attorney, Cocoa Beach, Fla.

Jan Neuharth
President, Paper Chase Farms, Middleburg, Va.

H. Wilbert Norton Jr.
Dean, University of Mississippi journalism school

Betty Bao Lord
author, New York

Judy Woodruff
PBS television correspondent

Background notes
Figures are from annual IRS 990 reports filed by the foundation and the museum. Compensation figures for Overby and Prichard comprise their salaries, benefits and expenses; they weren't paid trustee fees. For all others, amounts are trustee fees, benefits and expenses. Some trustees also were occasional members of the Newseum's separate governing board; in those cases, dollar amounts here are their combined compensation.

Neuharth is the daughter of foundation Founder Al Neuharth. Overby attended the University of Mississippi and is a member of its journalism school's board of directors. Freedom Forum has given $5 million for the school's Overby Center for Southern Journalism and Politics.

Two other trustees from 2000 left the board during the past two years. They are Madelyn Jennings, who was paid $696,303 through 2009; and Harry W. Brooks, paid $444,530 through 2008. Al Neuharth, who also was a trustee in 2000, has been paid at least $1,779,131 in wages, benefits and expenses through 2009.

Finally, two current trustees were not on the board in 2000: Orage Quarles III, publisher of The News & Observer of Raleigh, N.C., and Michael Coleman, a newspaper management consultant in Cocoa Beach. Quarles got paid $104,683 in 2004-2009. Coleman hasn't received any compensation, the documents show.

A brief history
Freedom Forum is a successor to the original Gannett Foundation, so it owes its existence to Gannett stockholders and employees. As the company's retired chairman and CEO, Neuharth controlled the foundation and its 16 million shares of Gannett stock in 1991. That year, shareholders agreed to buy back the stock under pressure from Neuharth. He then used the $650 million in proceeds to start Freedom Forum, and the Gannett Foundation name reverted to the company. Neuharth, 86, lives in Cocoa Beach.

Related: Download free copies of the 2009 tax reports. Here's Freedom Forum's. And here's the Newseum's.

Please post your replies in the comments section, below. To e-mail confidentially, write jimhopkins[at]gmail[dot-com]; see Tipsters Anonymous Policy in the rail, upper right.


  1. Another great report Jim. And as a veteran Gannett employee another report that makes me sick to my frickin' stomach. Overby got his start at a Gannett daily newspaper but he got rich by sucking from the Gannett tit while letting our daily newspapers wither and die. Unbelievable.

  2. This has to be the most incredible post I have read on this blog. What the hell do these people do to earn this sort of money. Charities don't work when the foundation runs out of money, so clearly the Newseum is just a few years from sinking into Tiber Creek, the river that runs under Constitution Avenue. So they meet once or twice a year and hear how everything is rosy and eat at Wolfgang Puck's. Furthermore, I think it is a huge conflict of interest for Judy Woodroof to work as a board of director for the Newseum. If NPR doesn't like what Juan Williams did on Fox News, the NPR directors need to look at what Woodroof is doing playing with the fraud that is the Newseum. I hope she is held to acccount for her tenure after it sinks. This all stinks.

  3. For these wealthy people to take these exhorbitant gifts from accounts that once funded food pantries says a hell of a lot of the morality of America's business leaders today.

  4. With that kind of income no wonder they're all smiling in their photos. Great reporting, Jim.

  5. I absolutely LOVE how the FF's donations went to fund the OVERBY Center. Kinda the same way that the Gannett Foundation's money went to fund the DUBOW scholarship.

    The only thing that compensates for these guys' lack of ethics is their overwhelming narcissism.

  6. Just one more example of Gannett's credo of corporate greed.

    Gannett....The G is for greed and the accent is on net (as in income.)

  7. I look good in a suit, and have a great smile.
    Can I be a $6 million dollar man too?

  8. Woodruff works for PBS, not NPR. They are two separate organizations with separate news operations. Both receive money from the Corporation for Public Broadcasting.

    I don't see how her involvement here is a conflict. Journalists can be involved in philanthropic activities. And when the cause is promoting our profession, shouldn't we be?

  9. @1:57: If you know of any philanthropic activities -- other than FF trustee -- that pay money for participating, please let me know. I have a lot of Christmas bills coming in the next couple months.

  10. This explains a lot. Why was there no oversight of the Freedom Forum? Because directors were PAID! In other words they were bought off. It's no wonder they were silent on the spending practices of the not-for-profit. The board was stacked. There was no independence. This was a classic case of not-for-profit governance gone seriously awry. If this was happening on a corporate level the stockholders would have been in revolt, especially the institutions. This is no way to run a railroad. A truly independent board would have never approved the financial shenanigans that is so apparent here. The Freedom Forum board of trustees brings a bad name to all non-for-profit boards, and that's wrong. There are plenty of VOLUNTEER boards that take their positions seriously, spend all sorts of hours keeping an eye on management without a cent of payment. Trustees at other non-for-profits do it as a way to give back to the community, not for a paycheck. These trustees get paid, and hold no one accountable for the profligate ways. This is shameful. In this day, when many not-for-profits are operating on the edge, the practices of this organization are nothing short of unethical.

  11. To the extent this board has been negligent in its oversight, I don't think money was the driver. Many trustees over the years were friends, family or business associates of Al Neuharth. That's particularly true of Overby, Prichard, Jan Neuharth, Malcolm Kirschenbaum and Madelyn Jennings.

  12. Here's a vivid illustration of the cost to Gannett employees of the Freedom Form's takeover of the old Gannett Foundation, and its payments to the board of trustees.

    The reconstituted Gannett Foundation never recovered from the loss of its $650 million endowment to Freedom Forum. Last year, for example, it gave a combined total of only $39,000 in college scholarships to children of GCI's 35,000 employees.

    In a sad irony, those are the Madelyn P. Jennings Scholarships, which provide one-time stipends of $3,000.

    Jennings, of course, was Gannett's human resources chief when Neuharth ran the company. And at Freedom Forum, she was paid $696,303 in fees, benefits and expenses from 2000-2009.

  13. The plague that has hit corporate journalism (financial rape by monied elites) extends to every facet of the trade... why wouldn't it?

  14. frozen Furloughed Fury12/27/2010 5:20 PM

    The sad part is the trustees in this rogues gallery of greed probably don't have the humility to be ashamed of plundering this endowment for a payday. I'll think of that the next time to old computer or crummy second tier software hampers me from doing my job or a co-workers deserving child doesn't get a scholarship.

  15. I'd be curious to know how charitable - and how stingy - these individuals are in their personal lives.

  16. 5:20 what are you talking about? The Freedom Forum has nothing to do with Gannett. The plundering is a crime but it's Al's crime not Gannett's.

  17. Here we go again. So if the Freedom Forum has nothing to do with Gannett, where did it get its money from and who set it up? How come the top staffers, including the flack, came from appointment to the foundation? Every post involving the Freedom Forum involves someone objecting to linking the organization to Gannett operations. Did Overby's friendship with Al Neuharth have anything to do with his appointment? Every post results in someone insisting there is no relationship between the Freedom Forum and Gannett. But you cannot deny the parentage, the links, and the number of Gannett careerists now working there.

  18. Freedom Forum and Gannett certainly share the same corporate DNA. And management in the 1980s is complicit for not creating legal protections that would have kept Neuharth and Overby from taking control of the original Gannett Foundation, and then subverting its traditional mission.

    But I don't think you can hold present-day management responsible.

  19. Jim, I don't see how you can say that in the wake of the transfer of Paulson from USA Today to the foundation. I would have gone along with your argument until that event, which I thought showed there is much, more more than DNA connecting the two entities. Also Susan Bennett from USA Today editorial staff to flack for the Newseum.

  20. 1:57 Actually, Woodruff is an employee of "The News Hour with Jim Lehrer," a separate corporation that contracts with PBS for the news hour broadcasts. I believe she is also under a contract for some series she's working on for NPR. The separate contracts arrangements are a way to pay Lehrer staffers higher salaries than offered either by PBS or NPR. This place is more incestuous than the Freedom Forum.

  21. To be fair, Overby and Pritchard, unlike the board members, were full-time paid executives and actually worked for their money. Whatever you think of the level of compensation, they are different from part-time board members.

    Jim made this point, too, but worth repeating.

  22. Woodruff should be ashamed of herself. Did you try to get a comment from her? That ridiculous sum is more than the annual revenue of some small weeklies

  23. I hear the Tea Party Republicans have special plans for the Corporation for Public Broadcasting, which funds NPR and PBS. The CPB is on the hit list of government programs to be cut and both TV and radio left to fund themselves with ads like everyone else.

  24. 10:20 Last year, when I wrote a related piece, I contacted Woodruff through the publicist for her PBS program several times. Eventually, I confirmed that Woodruff had received my message. She did not respond to my request for a comment, however.

  25. So Woodruff got less than $50,000 a year for nine years. Thats not unusual for a paid board position. Why take her to task. What am I missing, are you all socialists?

  26. Jim, Mike Coleman was a Gannett publisher who retired about 10 years ago. Is the current trustee the same guy?

  27. 12:08 Actually, it's across 10 years, so her pay averages about $43,000 a year. Also, in 2009, Freedom Forum said its trustees worked an average five hours a week -- so, about 260 a year.

    To answer your question, that's a lot of money -- or only a little -- depending on how you feel these trustees have discharged their duties over the years.

    Finally, a corporate governance expert once told me the following, about board members: They're paid too much for what they actually do, and too little for what they should do.

  28. 12:20 I suspect he is the same Mike Coleman, who was publisher of Florida Today until January 2006, when he retired after 42 years with Gannett.

  29. Whatever one thinks of Gannett and FF, this is solid work. Very disheartening when people you've admired from afar turn out to be corporate carpetbaggers.

  30. I wondered why b-lister Judy Woodruff seems to smile a lot.

  31. Jim, this is a serious suggestion: You ought to put these FF postings in for some journalism prize. Several prizes have opened their operations up to blogs, and your FF posts are a classic example of the sort of old-fashioned journalism that I once hoped blogs would become. Unfortunately, I see an awful lot of navel gazing on many blogs today.

  32. 12:08 here. Jim if you are advocating that board positions should not be paid positions then I can see your point with JW. Otherwise that's an average compensation for many boards. Now the other ones making millions, well that's a crime for a non profit. The government worries about steroids in baseball and turns the other way for the Madoffs and Neuharths. Al really should be called out on this.

  33. 3:06 Thank you -- and other readers who also have suggested I consider contests.

    I like my work on Freedom Forum and the Gannett Foundation. And I'll continue keeping an eye on both institutions.

    Having said that, my posts are of the sort that we should all expect to see at least several times a month in any newspaper. In other words, it's plain old enterprise reporting, based on readily available public documents. I'm not sure it's especially prize-worthy, however.

  34. You're right Jim, these posts are not prize worthy. They are interesting. They are not always correct. They are sometimes misleading. But they have some good old gumshoe reporting that makes many of us enjoy the effort. You would be roundly applauded if you would be mnuch more clear (and much more accurate) about the genesis of the Freedom Forum and its relationship (there is none) to GCI. It is criminal that you leave readers such as one poster to believe that his inability to have a working computer is a direct consequence of Freedom Forum spending. Yet you allow that to stand. Is this blog for Gannett employees or is it not? If it is, you should stop scaring people and stop blowing smoke - the Freedom Forum's spending priorities are most interesting but they have zero to do with Gannett and its sorry state.

  35. 8:18 In what ways are they "not always correct'' or misleading. He's basing these reports on public records which looks rock solid.

  36. 8:18 If there is no connection between GCI and the FFi,, then explain Paulson, and explain Susan Bennett.

  37. 8:18 I mostly agree with you about that computer comment. (Although, in theory, FF could have established a technology fund for deserving journalists.)

    But it's incorrect to say, as Corporate has in the past, that FF and GCI aren't related. They are fundamentally related in genesis (FF is the original Gannett Foundation) and management (FF's top brass are Gannettoids). Indeed, FF has been managed like one big annuity for retired Gannettoids.

    In any case, what's factually incorrect about the FF history I included at the bottom of this trustees post?

  38. This comment has been removed by a blog administrator.

  39. Bravo Overby et al!

    You saw the money on the table and you grabbed it. I wonder how many of these posters would walk away from it. None, I say. Not a one.

  40. What in God's name do these people do at Newseum do to warrant these salaries? I would give anything just to pull 75,000. I'm college educated. I'm as good looking at any of them. I have people skills. What's it gonna take?!


Jim says: "Proceed with caution; this is a free-for-all comment zone. I try to correct or clarify incorrect information. But I can't catch everything. Please keep your posts focused on Gannett and media-related subjects. Note that I occasionally review comments in advance, to reject inappropriate ones. And I ignore hostile posters, and recommend you do, too."

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