NAR’s discretionary spending is unparalleled among housing groups

Earlier this week the National Association of Real Estate Agents(NAR) has made headlines for the extravagant benefits and compensation its executives and volunteer leaders receive.

A New York Times The investigation detailed the lavish benefits enjoyed by trade group executives, most notably former CEO Bob Goldberg, who had three memberships at exclusive country clubs, paid for first-class airfare for personal travel, a $1,500 monthly car allowance, free babysitter for his dogs Tuffy and Fonzie, and tickets to “Hamilton” at the height of the musical’s popularity. These niceties were in addition to a salary of $1.2 million per year, which later increased to $2.6 million, according to NAR’s 2022 Form 990which was submitted in November 2023.

Other NAR executives who earned more than $1 million in 2022 include Mark Birschbach, the senior vice president of strategic business innovation and technology, and Shannon McGahn, the senior vice president of government affairs.

Voluntarily elected leaders also received elective benefits and swollen bank accounts. According to the 990 form, 2022 NAR President Leslie Rouda-Smith earned $413,566, while President-elect Kenny Parcell pocketed $256,956, First Vice President Tracy Kasper earned $181,362 and Treasurer Nancy Lane earned $212,356.

According to Form 990, all elected leaders worked an average of 30 hours per week for the trade association.

The New York Times spoke to seven nonprofit attorneys who claimed benefits at NAR were excessive. The lawyers also said the trade association may be in violation of tax law, given its status as a non-profit trade association.

“It is highly unusual — I would even say virtually unheard of — for volunteer leaders and officers to receive compensation at that level,” Jeff Tenenbaum, a nonprofit attorney in Washington, D.C., told the newspaper. “Many of us in antitrust law have always wondered, ‘How can they get away with this?’”

Using NAR funds for personal gain can be an offense known as “private insurance,” even if the expenses are related to business travel. Private insurance could cause NAR to lose its tax-exempt status.

Although the trade association declined to comment on the matter, 990 documents clearly show that compensation for NAR executives and leaders is not in line with other housing trade associations.

Association of Mortgage Bankers

Just like NAR, the Association of Mortgage Bankers (MBA) has leadership staff and a board of directors, which has its own leadership team. But unlike NAR, the compensation of the trade group’s leaders looks very different.

Although MBA President and CEO Bob Broeksmit earned $2.04 million for his work directly related to MBA in the 2022-2023 fiscal year, according to the 2023 MBAs Form 990, Matt Rocco, who served as chairman of MBA’s board of directors in 2023, took home $12,566. The MBA clarified that the reimbursement was for costs incurred specifically in the discharge of his duties as an MBA officer.

Other MBA officials who received compensation included chairman-elect Mark Jones, who worked an average of seven hours per week for the association and incurred $3,670 in expenses for the year, immediate past chairman Kristy Fercho (averaging one hour per week), who was reimbursed $6,892 and Vice-Chairman Laura Escobar (an average of four hours per week), who was reimbursed $1,623.

Although NAR’s paid volunteer leaders all worked an average of 30 hours per week for the organization, MBA’s 990 shows that chairs like Rocco only averaged four hours per week on MBA-related work, which might be more reasonable. workload for an uncompensated volunteer position.

American Land Title Association

In stark contrast to NAR, the American Land Title Association (ALTA), which also has elected volunteer leaders, including a president, who serves a one-year term, does not compensate any of its officers, including those who serve as president, president-elect, treasurer, committee chairs or governors.

According to the trade group’s fiscal year 2022 Form 990which was filed in September 2023 and is the most recent form publicly available, 2022 ALTA President Jack Rattikin III worked an average of two hours per week for ALTA and another two hours per week at related organizations. According to the filing, elected officials spend an average of one to two hours per week at ALTA and an average of one to four hours per week at other related organizations, including things like their state or local land ownership association.

ALTA declined to comment and would not clarify whether officers were reimbursed for expenses incurred while working for ALTA, such as travel expenses.

In addition to the fact that the volunteer leaders are not compensated, the salaries paid to ALTA managers are also much lower than those earned by c-suite managers at other trade associations. In 2022, ALTA CEO Diane Tomb took home $756,697 for an average of 40 hours of work per week at ALTA. Compensation for other executives ranged from $127,567 to $516,544.

National Association of Home Builders

The trade group that advocates for homebuilders, the National Association of Home Builders(NAHB) has approximately 140,000 members, about one-tenth of NAR’s membership, but the association still compensates its board of directors’ volunteer leaders. NAHB fiscal year 2022 Form 990 shows that board chairman Jerry Konter took home $41,121 in 2022 for an average of four hours of work per week, while John Fowke, the former chairman, took home $47,830, also for a weekly average of four hours of work. The trade group’s first, second and third vice presidents also received compensation of $34,226, $29,614 and $25,968, respectively. According to the NAHB, these payments are annual allowances to cover operating expenses incurred in performing duties associated with their role as senior officers of the NAHB. The association noted that these roles are all volunteer positions. Chairs are elected annually by the NAHB leadership council, which consists of more than 1,700 NAHB members, according to the trade group. The rest of the board is also voluntary and receives no compensation.

Among the trade group’s executive leaders, NAHB President Gerald Howard received the largest compensation package in 2022, taking home $1.774 million. Other top earners include James Rizzo, the group’s chief legal officer, with $575,375, treasurer and CFO Eileen Ramage, who earned $502,687, and James Tobin, who serves as executive vice president of government affairs and chief lobbyist, and $529,915 deserved.

Valuation Institute

Tops at approximately 16,000 membersthe Valuation Institute (AI) is much smaller than the approximately 1.5 million member NAR, but, like NAR, it compensates for the elected volunteer leaders.

According to AI’s fiscal year 2022 Form 990, Jody Bishop, the organization’s 2022 president, earned $148,525 in exchange for working an average of 40 hours per week for AI. Other compensated officials include newly elected President Craig Steinley ($104,600), Vice President Sanda Adomatis ($94,600) and former President Rodman Schley ($94,524). According to the 990 form, all three agents worked an average of 20 hours per week on AI-related activities.

But while AI’s elected leaders were compensated more generously than those of other, larger trade groups, its executives were paid less. AI CEO Jim Amorin took home $498,511 in 2022 for an average of 50 hours of work per week, while CFO Beate Swacha earned $253,925, and general counsel Jeffrey Liskar made $326,920.

American Chamber of Commerce

Although it is not a trade association for the housing construction sector, the American Chamber of Commerce is one of the few industry associations with comparable weight and influence to NAR. The group, which claims to have members from over 3 million companies advocates for policies across the country that help businesses and the economy.

The organization’s most recent Form 990 is from the 2022 financial year and shows that the board of directors of 111 directors, all of whom work an average of one hour per week for the group, are not compensated. CEO Suzanne Clark, who took over as longtime leader Tom Donohueearned $5.9 million in salary from the nonprofit, plus $423,000 from related organizations.

The second highest salary earner was Agnes Warfield-Blanc, who earned $4.4 million in 2022, while executive vice president and COO Justin Waller, executive vice president and chief policy officer Neil Bradley, intelligence chief Myron Brilliant, chief legal officer Harold Kim, executive vice president David Hirschmann, senior vice president of policy Martin Durbin and chief communications officer Michelle Russo all earn between $1 million and $2 million a year.

The House did not respond to HousingWire’s request for comment.

Jeff Andrews contributed reporting.