 |
||||||||
 |
||||||||
|
||||||||
Back
|
Senior aid group told to trim costs
By CURTIS KRUEGER
© St. Petersburg Times, Neighborly Senior Services, which sends meals and aides to the homes of thousands of Pinellas County residents, has laid off more than 100 workers in the past three months because of budget woes. But even as this non-profit group was slicing its front-line staff, a government agency was questioning the salary paid to the group's president, and threatening to reduce money for salaries, travel and other expenses for those at the top. "There were some costs in there that we did not feel were appropriate," said Sally Gronda, after reviewing the group's budget. Gronda is executive director of the Area Agency on Aging, which contracts with Neighborly Senior Services to provide state and federally funded programs such as Meals on Wheels and in-home care designed to keep people out of nursing homes. One of those costs is the salary of Fred Buchholtz, Neighborly Senior Services' president and CEO, who said he is paid $120,000 a year. He said he also receives a benefits package worth 35 percent of his salary, which would amount to $42,000. He can use that for insurance, pension, other benefits or cash. He also has a company car. But state regulations only allow a CEO to be paid $82,600 from the types of government funds used to support the agency, Gronda said. It's not that a higher salary is inappropriate, Gronda said, just that her agency is not allowed to pay that much for a CEO's salary with the state and federal money it administers. If Neighborly wants to pay more, it must find another source for the amount above $82,600, she said. Gronda stressed that "they have been an outstanding agency" and still are, but she said that certain costs should be trimmed. Gronda has refused to pay for a vice president for quality improvement and risk management, who earns $62,000 plus benefits. And she is troubled by some other budgeted items, such as travel expenses. Buchholtz, his secretary and a purchasing coordinator have a combined travel and training budget this fiscal year of $25,000. Buchholtz acknowledged most of that money is for his use, although he said he is under budget this year. The nine-person finance department has $22,500 allotted for the same purpose. Gronda also questioned $16,000 budgeted for employee and volunteer appreciation gifts. Gronda said she understands the value of training and conferences, but at a time when the agency is laying off staff who actually go to the homes of elders, it makes sense to reduce administrative costs. "You cut administration," she said. "You can't just cut the people who deliver services." Buchholtz said he is responding to Gronda's concerns. The vice president will be let go at the end of this month, he said, and he is making thousands of dollars of cuts in his administration -- some suggested by her, some not. Among the reductions: Cutting $54,000 worth of computers, saving $131,170 by reducing staff in information services and $61,166 by eliminating two positions in human resources; and several others. He said he decided against taking a new company car that his board approved. He said his agency's overall mission is to provide quality services to elders, and that it does so in spite of tight finances -- last year it spent $700,000 more on its programs than it was reimbursed for, he said. "We're not driven by the dollars, we're not driven by profit, we're driven by the mission," Buchholtz said. Records show a few unusual expenses for which Buchholtz has billed his agency. Last year he received $507 for Road Runner Internet service at his home, so he could research matters affecting elderly programs on his computer. He received $250 for membership in the U.S. Airways Club, a valid expense, he said, because it enables him to use the club's facilities as a temporary office in whatever airport he happens to be in. While attending a conference in Philadelphia in late 1998, he went to dinner at Le Bec-Fin, considered one of the country's best restaurants. He billed the agency $164.46 for his meal. He said he did not realize Le Bec-Fin was such an expensive restaurant until he already had arrived, and said he never would have gone along if he had known. This meal came before the layoffs were even envisioned, and Buchholtz said finances were in much better shape at the time. Many of his other meals are more modest, such as a $2.69 double-cheeseburger from Burger King. Gronda was quick to compliment Neighborly Senior Services for high-quality programs and for a pioneering history in serving elders. A 35-year-old agency, it was the first organization in the country to offer federally funded Meals on Wheels and adult day care, Buchholtz said. He joined the agency in its second year as head of the adult day care program and is nationally recognized in the field. The $15-million agency provides more than 397,000 Meals on Wheels per year, more than 224,000 group dining meals, more than 112,000 home health aide visits, and many other services. A complicated budget situation involving state finances forced the agency in March to lay off 25 workers and leave 35 other positions unfilled in a program that sends nurses and housekeepers to the homes of Medicaid-eligible senior citizens. "We feel terrible that in some cases services have been given and will need to be reduced," Buchholtz said at the time. Last month the group announced it was laying off 82 other full-time and part-time employees who provided in-home health care. It said it wouldn't provide the program any longer because reimbursement rates from the federal government were too low, and because of other financial woes, such as declining returns on investments. The program will be contracted out to other home health agencies, and Buchholtz said his agency will make sure everyone receives services with the new companies. After those events, Area Agency on Aging staff took a closer look at Neighborly's budget. That's when they discovered it paid more than allowed for Buchholtz's salary, and the other items that Gronda found troubling. Why didn't the Area Agency on Aging notice these problems earlier? Gronda said their contracts with Neighborly use a "unit cost contracting" system, in which the two groups negotiate a price per meal, or per hour of home health care, that Neighborly should be paid. Under that system, she didn't see a complete budget that explained how much executives were earning. She said she now wants to move back to a "cost reimbursement system," that will provide a clearer budget picture. Susan Tucker, assistant administrator of the Department of Elder Affairs, said the unit-cost system can make it difficult to scrutinize a budget. However, she said the Area Agency on Aging also should have known whether it was overpaying a CEO. - Times staff writer Stephen Nohlgren contributed to this report.
 © 2006 • All Rights Reserved • Tampa Bay Times
490 First Avenue South • St. Petersburg, FL 33701 • 727-893-8111 
|
Headlines From the Times local news desks Mary Jo Melone |
