Huge Salaries for L.A. Treatment Executives Challenged

Tarzana Treatment Centers, an L.A.-based nonprofit drug-treatment program that receives millions in annual government contracts to provide services, is raising eyebrows because of its top executives’ generous salaries, compensation packages and business arrangements, the Los Angeles Times reported on June 11.

The program, which gets 85 percent of its funds from taxpayers and is the largest user of public funds in Los Angeles County, has a $45-million annual budget and paid its chief operating officer, Albert Senella, $428,057 in 2007. That was well above the salary for the medical director of Harbor UCLA Medical Center, the highest-paid county employee; the medical center has a budget 12 times the size of Tarzana’s.

Scott Taylor, Tarzana’s CEO, made $330,732 for 32-hour work weeks.

“These people are making what for-profit people make,” said Steven Winston, who makes $173,000 and is the highest-paid executive at the New York-based nonprofit treatment center Daytop Village. “It’s anathema to what real nonprofits and real charitable organizations do.”

“How many more services could be provided to people who need them” if the executives’ salaries were lower? asked Ken Berger, head of the charity watchdog group Charity Navigator.

Along with their salaries, Senella and Taylor got hundreds of thousands more in deferred compensation, according to tax filings. The men also have ownership stakes (along with two other board members) in six properties that are leased by Tarzana as its headquarters and treatment sites. In 2007, the four men received more than $2.27 million in rental payments.

According to tax filings, Tarzana paid Taylor, who is a lawyer, an additional $237,956 in 2007 for legal services.

Tarzana executives said the pay reflects decades of successfully pursing government grants and expanding services. While the center is a nonprofit, “We are allowed to make money as individuals,” said Senella.

A majority of what Senella and Taylor earn comes from a group of patients who pay out-of-pocket or with insurance, the county confirmed. That represented $7 million of Tarzana’s $45 million revenue in 2007.

Tarzana treats about 6,000 patients annually. Senella heads the California Association of Alcohol and Drug Program Executives, and Tarzana has won praise for the efficiency of its operations.

“Everyone agrees that they are one of the better providers in the area,” said John Viernes Jr., director of the Los Angeles County Alcohol and Drug Program Administration. “We don’t tell them what to pay their executives.”