Photo shows a typical $2 million house for sale in Great Falls, Va., an exclusive community near Corporate's headquarters, where CEO Craig Dubow and other members of the top brass live:
Gannett Bloggers have been debating whether top executives need to move their residence near Corporate headquarters at McLean, Va., when they get major promotions -- and at what cost to the company. (The debate starts here in this comment thread, about Chief Digital Officer David Payne.) One question raised: Does Corporate buy an executive's home as an incentive to help them make the move?
Anonymous@5:36 a.m. today says no: "Gannett doesn't buy executive homes anymore, period. You can lie -- oh, sorry, speculate -- all you want, but it doesn't make it true."
In fact, it depends on how you define, "buy." In recent years, Corporate has spent at least $940,000 relocating the company's most senior executives, a figure that mostly comprises payments to help executives sell and buy homes. The payments were made under GCI's relocation policy "applicable to management employees generally,'' according to documents filed with federal securities regulators.
The documents do no detail the benefit rules, nor do they say which management executives are entitled to receive them. In the past, however, they've been made broadly available. (In 1996 and 1991, GCI paid my moving costs when I got promoted to jobs in Boise, Idaho, and then Louisville, Ky.)
Overall, the biggest payouts go to the company's most highly paid executives -- about a half-dozen top officers. These payments are the only ones publicly disclosed. Many thousands of dollars in other payments to executives at the level of, say, publisher or general manager are not made public.
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| Dave Hunke |
In 2009, Hunke got paid $250,000 to reimburse him for "a loss incurred as a result of the sale of his former residence in connection with his relocation to USA Today headquarters." He also received a tax gross-up payment in the amount of $118,732. And, finally, he got an $85,000 relocation bonus. These amounts are disclosed in the 2010 proxy report.
Hunke was promoted to publisher in April 2009 from CEO of the Detroit Media Partnership, which publishes the GCI-owned Detroit Free Press and MediaNews Group's The Detroit News under terms of a joint operating agreement. Home prices fell when the Detroit area economy took a nose dive under the weight of the auto industry's near collapse.
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| Saleh |
Two other recent high-profile hires -- CDO Payne and Chief Marketing Officer Maryam Banikarim -- likely aren't paid enough to require public disclosure of any relocation benefits they got.
Other examples include:
Also in 2008, Dickey's annual $360,000 bonus included "a $90,000 relocation bonus in connection with his promotion to President/USCP,'' according to the 2009 proxy report.
In 2002, Craig Dubow got paid $158,000 in "other compensation" that included relocation benefits after he was promoted to president of the broadcast division. He had been living in Atlanta. The company did not break down the dollar amounts, but it said the overall figure included a country club membership fee of $70,000. (See: 2003 proxy report.) Dubow became CEO in July 2005.
In 2002, Craig Dubow got paid $158,000 in "other compensation" that included relocation benefits after he was promoted to president of the broadcast division. He had been living in Atlanta. The company did not break down the dollar amounts, but it said the overall figure included a country club membership fee of $70,000. (See: 2003 proxy report.) Dubow became CEO in July 2005.
The rich get richer. These relocation payments are also padded like hell. The Achilles heel in the process is having your home assessed. They only require two assessments, so if you shop around, you can come up with someone who will give you the most generous estimate on your house price, and that will be the price the company pays. Then you can have the assessor neglect some of the negatives, like badly needs a new roof: persuade the assessor to overlook the roof, and you get more money. Then Gannett gets the house and puts it back on the market, and lo and behold, the flaws in the assessment are uncovered and Gannett has to pay for the improvements to sell it. It's a real scam, and if you don't think these execs fight over every nickel and dime, then you don't know anything.
ReplyDeleteAlmost $1 million in relocation expenses. I assume much of this involves movers expenses, but then what are they moving that is costing $1 million to ship: the Titanic?
ReplyDeleteThis sort of thing is what's wrong with corporate America. Why should any company pay relocation expenses? Yes it is costly to move, but if you want the job enough then you can pay them. Are these people going to turn their backs on their huge salaries just because Gannett won't pick up relocation costs?
ReplyDeleteCan't sell your house because of the lousy real estate market? Tough. Either send the keys to the bank and walk away, or keep the payments flowing until someone buys it. This is the way things are working these days.
ReplyDeleteGreat reporting, as usual.
ReplyDeleteWell done.
Well, if the company was relocating smart, difference-making executives, ones that would truly help transform the company, then I'd say the investment was worth it. However, we all know that based on who they have relocated, it was a huge waste of money!
ReplyDeleteWhat really burns my ass is $70,000 for a country club membership for Dubow. Seriously? I don't earn that much in one year.
ReplyDeleteJim, great job in getting some numbers for what has been just talk.
ReplyDelete9:41 But look at all the business that Dickey has gotten from being on the greens and in the clubhouse. I bet there are advertising executives lined up around the block waiting for a chance to have a golf game with Dickey.
ReplyDeleteMy favorite line from the movie "The Company Men" is what Craig T. Nelson's CEO character says to second in command Tommy Lee Jones as he's laying off a couple thousand employees... The scene plays out in the new corporate headquarters on an unfinished floor. CEO is telling cronies how large and plush their new offices will be. Jones' character voices an objection over whether a new building is prudent at this time with layoffs in full swing... CEO's retort, "I'm not running a charity, here."
ReplyDeletenuff said.
9:41 That $70,000 club membership fee is only the tip of the iceberg. By having it classified as a business expense, he can write off on his expense account all restaurant and drink charges, caddy fees, and any other associated costs like a new set of clubs. After all, he can argue, he wouldn't be there if it were not business-related.
ReplyDeleteIt is a good thing to be an executive.
ReplyDeleteI've enjoyed many of these benefits on a much lower scale. I've even lost a significant amount of money on one home.
ReplyDeleteAll of this carping and class warfare pratter is silly. These are simply benefits most Fortune xxx companies offer to attain and maintain talented individuals. It's nothing new and nothing like it once was.
Get over yourselves and get back to work.
Ciao haters!
Jim spin it any way you wish but Gannett used to purchase homes if you couldn't sell it and now they don't. CLosing and moving costs are paid by every major company in America so cut the nonsense. Time to send in more money Lemming Trolls
ReplyDelete10:28 -- The class warfare pratter is certainly not silly because the war is raging full scale, and it's the wealthy who fired the first shot. Look at the average wage trends for the general workforce and for executives over the last 30 to 40 years and you will see a growing disparity that has nothing to do with how hard people work or how smart they are. It's all about sweetheart deals that corporate America has worked with our political leaders (both Republicans and Democrats).
ReplyDeleteYou may feel entitled to more than everyone else just because you're you, but the fact that you would sign off with something as trite as "haters" indicates that you never graduated from the high school mindset. In fact, if you were ever an executive in this company, it says a lot.
Here's hoping we don't see an actual class war, but as the rich squeeze the rest of the populace harder and harder, I'm afraid things could get scary.
You're kidding yourself if you think these huge perks stop apply only to top execs. I beg you to look at some of the pubs, EEs and other top brass at some of the papers who literally get flown back home twice a month on the company dime for up to a year after being relocated, temporary housing - you name it.
ReplyDelete11:36 -- Arguably executive editors are top managers. Of course, the EE at a very small publication doesn't have the status of one at a larger pub. But historically executive editors and publishers have been paid extremely well. That said, the perks for CD, Gracia and the top ranks are extravagant compared to what the average EE might get.
ReplyDeleteThis sort of thing is what's wrong with corporate America. Why should any company pay relocation expenses? Yes it is costly to move, but if you want the job enough then you can pay them. Are these people going to turn their backs on their huge salaries just because Gannett won't pick up relocation costs?
ReplyDelete5/27/2011 8:50 AM
Actually most anyone would turn their back on a promotion if it didn't include relocation expenses. If you have to eat the loss on your house plus thousands in moving and then buying another residence or renting one; any increase in compensation is not worth it unless you are in the very top of GCI's executive force (i.e Craig and about 6 other people). Even if someone got a $100,000 raise it would be eaten up almost immediately if not more and then more than likely within 12 - 24 months you would be out of a job. Let's use your head here.
12:04 -- If what you say is true, why does the company offer these extravagant relocation expenses only to the top brass. I have twice been offered relocation expenses by Gannett (both times when the economy was better than it is now) and the money was a pittance. Basically enough to rent a U-Haul, pay for storage for a few weeks and cover about two weeks of temporary housing. Never did the deal include buying or selling my house, etc., etc., etc.
ReplyDeleteAlso, if I received a $100,000 raise, I could not only move, but pay off all of my debts. I don't know how often you've actually moved, but the only people who would eat through $100,000 moving in a single year are (again) the highest paid employees in the company who live in multi-million dollar mansions. And you admit that they are the ones who could actually afford to eat the expenses.
I agree that a generous moving package might be necessary to lure the best and brightest to your company. But I haven't seen anyone fighting over the executives that Gannett routinely promotes and hires. They're mostly good ol' boys and girls receiving another corporate handout.
GCI relocated me multiple times while I was with the company. The relo package that covered some moving and closing costs was a fair trade-off considering you were (presumably) doing the company a favor by relocating to whatever remote outpost of the Gannett empire they wanted you to go to and solve problems. Never had limo service, though. Should have asked, I guess.
ReplyDelete10:28 ... talented individuals ... ?
ReplyDelete10:59: I used to think that was the case but now I'm left wondering if that's true for all executives or if there are a few "favorites" who still get every benefit that was offered in the past. It's worth looking into.
ReplyDeleteIs there a limit as to how many $70,000 country club membership fees a suit can have? Does Dubow have two (locally and his vacation home locale)?
ReplyDeleteThe further embarassment about this benefit is that the IRS regards these relocation fees as a business tax deduction, so all American taxpayers are effectively paying these relocation costs and country club fees for millionaires. Yet more reasons for tax reform: write your member of Congress if you don't like it.
ReplyDeleteSo what are we to make of all this, it's disturbing. I realize companies offer these perks to attract talent but it's not about the perks as much as it is about excess under certain conditions. You don't pay out millions to execs when revenues are falling and thousands of employees are losing their jobs. I once heard that a former ceo, John Curley wouldn't accept a salary above $800,000 and back then Gannett was an earnings juggernaut so he could have easily gorged himself at the trough. Don't know if that's true but if so it sounds like his character. Jim, wonder if this could be verified from old corporate filings. If its true, guess we don't have anyone left in the leadership ranks with that type of gravitas.
ReplyDeleteWe once were giants...
I wasn't a "local" exec, so no country club memberships. But was treated well with relo, etc. Lots of bonuses, even after the layoff. Overall, that's how it should be for the people they ask to move around and solve problems. Not too much, not too little. But now I'm out in the cold like anyone else.
ReplyDeleteDidn't McCorkey have five country club memberships? And doesn't he still have three? At least that's what I heard when I was at the House of Payne recently. But the real good news, I suspect, is that if they are at the country club slicing balls they can't be slicing budgets or things like that, right?
ReplyDeleteGood reporting Jim, as usual. To 10:28 and your class warfare comment, it IS class warfare and the middle class is losing. By all means defend another perk for those who can afford that kind of a loss (it's called capitalism and free market place) while asking the regular working people to endure furloughs, wage freezes and God knows what ever else they're dreaming up. And the money saved doesn't go into the company, as it should, but in to the pockets of failures who have no business plan except to cut. When Forbes magazine calls the company out, as it did for executive compensation, that's a problem, even you can't ignore, troll.
ReplyDelete10:26 or King of the Lemming Trolls, you sound like the head of the Communist party. Listen Comrade if you are such an intelligent innovative leader why arent you running a company? Those who cal lead, the rest post on blogs! Respect and dignity comrade
ReplyDeleteYour question "Why aren't you running a company?" is missing that very important qualifier: "into the ground."
ReplyDeleteCalling people communists -- OMG, I hope Joe McCarthy isn't reading this blog!! -- doesn't distract from the odious fact that laying off people to line your pockets has a very un-American stench to it.
I think "King of the Lemming Trolls" would make a terrific title for a sci-fi/fantasy novel.
ReplyDeleteTo 10:26pm, don't bother debating 11:08pm/9:41am, because this person chooses hyperbole over fact. I keep suggesting this person go elsewhere but apparently this is their job, counterintelligence to keep the masses from recognizing failed leadership when we see it.
ReplyDeleteAs I recall, didn't Gannett build a house on Lake Tahoe for Al Neuharth? And, later, didn't Tom Curley sell the corporate helicopter when he found its primary use was to fly Doug McCorkindale to golf courses? Nice perks.
ReplyDeleteI was with Gannett for 20+ years and all I got for free an occasional slice of birthday cake.
11:22 Interesting story, but: You must be referring to John Curley. His bother, Tom, was publisher of USA Today, and would not have had authority to sell a helicopter used by Doug McCorkindale.
ReplyDeleteJohn preceded Doug as Gannett's CEO.