from The New York Times:

Lawmakers Seeking Cuts Look at Nonprofit Salaries

State and federal officials are starting to take their knives to the pay of leaders of nonprofit groups they do business with to help share the pain of tighter budgets.

… On Capitol Hill, four senators this spring refused to approve a $425 million package of federal grants for the Boys & Girls Clubs of America after staff members looked at the organization’s tax forms as part of a routine vetting process and were surprised to learn that the organization paid its chief executive almost $1 million in 2008 – $510,774 in salary and bonus and $477,817 in retirement and other benefits.

… Another senator, Charles E. Grassley, Republican of Iowa, has told Treasury Secretary Timothy F. Geithner that he is concerned that the Internal Revenue Service is not tough enough in policing pay in the nonprofit sector and that regulations governing compensation are too weak.

“I’ve asked him to review these regulations to see how they can be made effective,” Mr. Grassley said. “What’s there now doesn’t seem to be working.”