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SANDY — The founder of The Ark of Little Cottonwood insists she has nothing to hide. She and her sons say everything they've done has been reviewed by nonprofit charity experts and is perfectly legal.
Is their compensation excessive? They say it's not.
On the organization's four-acre estate in Sandy, it costs $15,000 a month for a client to stay. But all the food is from the Utah Food Bank, leftover groceries donated by stores.
The Ark of Little Cottonwood qualifies for free food deliveries and various tax breaks because it's a nonprofit charity dedicated to curing addiction.
The center, founded by Gloria Boberg, treats patients with addictions of all types, including drugs, alcohol and pornography. There's group therapy, counseling, even horse therapy available to help people trying to get their lives back.
"I think we have done a really good job in helping the people in this population," Gloria Boberg told KSL News.
"I would not exist without this program," said Julianne Robinson, a client of The Ark.
"We can never be grateful enough that Julianne came here," the girl's mother, Keri Robinson, added.
The Ark has eight full-time and 12 part-time employees. Boberg is executive director. Her sons Jeremy and Darron manage admissions and the business side, and daughter Laura is a counselor.
It was a family business, later converted to a nonprofit agency.
"All but Laura was hired prior to the nonprofit status," Jeremy Boberg explained.
According to surveys by the Utah Nonprofits Association, $80,000 was the average salary in 2006 for an executive director of a comparably-sized nonprofit agency. It was $117,000 in 2011.
Gloria Boberg's salary was $161,000 in 2008. It declined somewhat during the recession.
"Oh, I'm very worth it," Gloria Boberg said. "I've had a lot of education and training. I've served as the Salt Lake Community College's drug and alcohol prevention specialist. Yeah, I know addictions inside and out."
For secondary management positions, the surveys show average nonprofit salaries in the high $50,000 range. Jeremy and Darron Boberg earned $132,000 each in 2008. They took less during the recession but are expecting raises when The Ark's revenues improve.
The Ark pays over $300,000 a year to lease buildings and grounds, money paid to a company owned by the Bobergs. They say it only covers property taxes and mortgage payments, a situation forced on them by a complicated legal dispute.
"We're wearing several different hats," Jeremy Boberg explained. "We feel that we're on a very appropriate — from what our investigation with other programs (shows), we feel like it's been appropriate."
IRS documents show the three also collect $11,000 to $21,000 each, per year, in "other compensation." They say that's Ark-related car and travel expenses.
University of Utah Professor Steven Ott, an expert on nonprofits, hasn't investigated The Ark, but he says the law gives the IRS authority to crack down if nonprofit salaries are excessive.
The Bobergs insist their pay should be compared with salaries outside Utah, at other high-quality, high- intensity residential treatment programs.
"I've had job offers for more money than I make," Gloria Boberg said.
But Ott believes the Utah survey is a reliable comparison. "I could not think of any better source of information," he said.
"We were working, and still are working more than 60 hours a week," Gloria Boberg said. "My sons are on call 24-7"
"That is typical of people that I know who run similar type organizations in this area," Ott said.
The Ark pays over $300,000 a year to lease buildings and grounds, money paid to a company owned by the Bobergs. They say it only covers property taxes and mortgage payments, a situation forced on them by a complicated legal dispute.
"In order for us to keep this property, we had to become the owners of it," Gloria Boberg explained.
In theory, the Bobergs could someday pay off the mortgage and own an estate paid for with nonprofit funds. They say there's little chance that would happen.
"We're so upside down on this property. It's not even a reality that any of us have ever even looked at," Jeremy Boberg said. "It's just not there. There's no equity in this place."
"The job of a nonprofit is not to support a high mortgage," Ott said, adding that the IRS has established criteria for how nonprofits should operate.
"One of which is that the people making the decision cannot be the people who benefit," Ott said.
The Ark's board of directors currently has five members, three of whom are Jeremy, Darron and Gloria Boberg. They say there once were 10, but they've had trouble keeping board members.
In any case, they say the board has never been a rubber stamp for the Boberg family.
"If a board decision was made, if we need to abstain from a vote or whatever, it's done appropriately," Jeremy Boberg said.
The Bobergs point out they donate more than a half-million dollars worth of free care each year, helping many desperate recover their lives, the mission of their nonprofit agency.
