Senate Judiciary Committee members this week asked the board of the Boys & Girls Clubs of America to explain the organization’s $54 million in offshore investments and $53 million in private equity funds at a time when local clubs across the country are closing due to lack of funding.
According to the Bureau of National Affairs (BNA), the inquiry came from Republican Senators Charles Grassley (R-IA), Tom Coburn (R-OK), John Kyl (R-AZ) and John Cornyn (R-TX) and focused on what they perceived to be a low payout rate to local clubs from the national organization’s endowment funds.
The inquiry follows scrutiny earlier this year of high executive salaries, excessive travel expenses and lobbying fees reported by the Boys & Girls Clubs. There are roughly 4,300 local clubs in all 50 states, and the national charity receives more than $41 million in government grants for its work with about 5 million children each year. A bill reauthorizing a Department of Justice grant program for the Boys & Girls Clubs is pending in the Senate, but the four Republican senators say they need more answers before any additional federal funds are committed.
According to BNA, the board of the Boys & Girls Clubs of America is gathering the information the senators requested and will provide a comprehensive response. The national group had already responded to the senators’ earlier inquiry about executive compensation practices, travel expenses, and so on. BGCA reported that it rigorously adheres to IRS guidance on executive compensation, including using a third party to assess the marketplace and determine comparable salary practices. BGCA also said it does lobby Congress for grant money, but fully complies with the Lobbying Disclosure Act (LDA) in reporting its activities and expenses.