WHYY’s Bill Marrazzo problem

The missing ingredient at WHYY

Stop the presses. “WHYY chief paid more than peers in public media,” announced the Philadelphia Inquirer’s front page on Saturday. The story reported that William J. Marrazzo, president and chief executive of Philadelphia’s public TV/radio outlet since 1997, had received $757,164 in total compensation in 2015, tops among his public TV peers in Boston, Washington, and Dallas, “as WHHY added to a run of profitable years while the others posted losses.”

Marrazzo: Where's the passion? (Photo via princetonchamber.org.)

To which you might well ask: What else is new? And why shouldn’t the head of a not-for-profit organization be rewarded for turning a profit? Especially when his TV station delivers stimulating programming, hard-hitting journalism, and, y’know, provocative criticism that keeps millions — OK, hundreds — of Philadelphians glued to their sets…

Never mind.

Passion but not money

As local grouches like the Inquirer, Philadelphia magazine, and yours truly have pointed out for years, Marrazzo makes more money than just about anyone in public broadcasting while delivering much less. If you’re looking for balanced budgets, Bill Marrazzo is your man. But if you’re looking for a quality alternative to commercial broadcasting — the presumed mission of public radio and TV — you'd best look elsewhere.

As print journalism has declined in the face of Internet competition, many dedicated journalists, armed with passion if not money, have struggled to fill the gap. Increasingly these days, journalism is going the nonprofit route, with sites like the Pulitzer Prize-winning newsroom ProPublica.org; the Marshall Project, a site that focuses on the criminal justice system; the Center for Investigative Reporting; and the Tampa Bay Times, which has operated for decades under the nonprofit Poynter Institute For Media Studies. Philadelphians can turn to not-for-profit sites such as Billy Penn, Hidden City Philadelphia, the Philadelphia Citizen, and of course, Broad Street Review. WHYY, by contrast, has hundreds of employees and an annual budget of more than $30 million, but no apparent motivation to fill the void left by the for-profit sector — which was, after all, the original justification for public broadcasting.

'Fresh Air' host Terry Gross's WHYY tenure long predated that of Marazzo. (Photo via Creative Commons/Wikimedia)
'Fresh Air' host Terry Gross's WHYY tenure long predated that of Marazzo. (Photo via Creative Commons/Wikimedia)

Not until 2008 — more than 10 years after Marrazzo arrived — did WHYY pay serious attention to journalism, with the hiring of former Inquirer editorial page editor Chris Satullo to run its bland newsworks.org. Satullo was dismissed in 2015 for reasons that remain unclear.

To be sure, WHYY radio is well known for its national interview shows Fresh Air, hosted by Terry Gross, and Radio Times, hosted by Marty Moss-Coane, but both of those predate Marrazzo’s tenure.

The smell test

You can’t blame Marrazzo alone for his priorities. Marrazzo’s pay raises, as WHYY’s then-chairman Jerry Sweeney explained in 2008, were determined by “a very specific set of metrics . . . things like increasing audience share, converting to digital technology, and bringing the budget into line.”

As I pointed out in BSR back then, “In their negotiations with Marrazzo, the WHYY trustees have cluttered their minds with a series of bureaucratic tests to justify Marrazzo’s pay package while blithely ignoring the only test that really matters: the 'smell test.'”

Not much has changed since then. According to Saturday’s Inquirer, the WHYY board now sets Marrazzo’s compensation “with the help of a consultant who creates an index of pay at public media organizations, nonprofit educational institutions, and cultural organizations in the Philadelphia region, such as the Philadelphia Museum of Art and the Philadelphia Orchestra.”

Unique combination

Do you get the feeling that nobody at WHYY read my column back in 2008? Or could it be that WHYY’s directors, lacking a financial stake in the operation, have little incentive to engage in hard-nosed bargaining with Marrazzo? Or both?

The Philadelphia Museum of Art and the Philadelphia Orchestra are world-class institutions — that is, they attract a global clientele. WHYY has never been mistaken for a world-class operation. Is there no consultant capable of pointing that out?

Let the record show that Marrazzo’s rare combination of connections in municipal government (he was Philadelphia’s water commissioner), in business (he was CEO of Roy F. Weston Inc., an environmental consulting firm), and Philadelphia’s cultural community (his wife, soprano Randi Marrazzo, is a co-founder of Lyric Fest) renders him a potentially valuable civic resource. Let the record also show he’s a superb fundraiser, as he has demonstrated at WHYY for nearly 20 years. But the critical question remains: to what purpose?

Our readers respond

Robert Zaller

of Bala Cynwyd, PA on July 12, 2017

Enjoyed your takedown of WHYY.  I stopped listening to their radio the day they took classical music broadcasting off the air in favor of "Car Talk."  Their TV — reruns of Lawrence Welk and the Three Tenors — was embarrassing long ago But my bigger objection— bigger even than Marrazzo's salary, or for that matter John Fry's at Drexel, where I teach — is to government broadcasting as such. 

Journalism is one area in which I believe in competitive private enterprise, the fiercer the better. Maybe the BBC works for Britain, but there's never been anything like that here, and the middlebrow, play-it-safe programming and commentary on PBS is a waste of taxpayer money at best and a species of indirect propaganda at worst. 

Journalism should police itself by rigorous professional standards and competitive self-criticism, but there should never be any pretense that there is a neutral, objective source that you can unproblematically "trust."  That's really the unspoken premise of public broadcasting, and it's also where propaganda begins.

Author's Response

In theory, I agree with you— especially when your theory is applied to places like Greater Philadelphia, which enjoy a robust variety of media voices. On the other hand, I once undertook a two-week project that required me to spend hours each day in my car while driving across southern Illinois, Missouri, Kansas, Nebraska, and Wyoming. In such cultural wastelands, was I grateful for the companionship of public radio? Believe it.

K. Palmer Hartl

of Society Hill/ Philadelphia, PA on July 13, 2017

This seems an update to the 2008 piece, as the author indicated. This observation seemed to go nowhere then, and I am not sure it will go anywhere now. I think it identifies a general problem with CEO salaries. Boards are complicit. In many cases it is a crony system.  Many of the people who sit on this board are friends and connected generally in the Philly area. CEOs become part of the club.
 
I think the real issue may be: How do we value the contribution of a CEO to company success?
 
I remember after the 2008 crash, the New York Times columnist Paul Krugman said that until we solve outrageous CEO compensation packages, we will not solve the economic stability problem.  

I also heard an interview the other day with a person who has written about the end of the loyalty paradigm  and the loss of benefits by American workers.  When asked when this changed, the author said that he believed it was when CEO salaries started to be linked to the stock price. At that point, the motivation was to get the stock price up and be damed with what that meant in terms of other stakeholders and their importance to the organization. Cost control was a key part of getting the price up, and benefits are expensive.  There is hardly a single defined benefit pension plan left outside of government employees, and even there it is going away.
 
In Bill Marrazzo's case, it would be interesting to know Terry Gross's compensation. She is the main national talent that WHYY has. I will bet it is not equal to his.

Author's Response

As a former clergyman turned management consultant, you are perhaps ideally suited to define what constitutes "success" for a not-for-profit institution. If a church produced a balanced budget but little else, would it be deemed successful?  

Wayne Thomas

of Philadelphia, PA on July 14, 2017

The WHYY situation is far from unique. The WHYY trustees, like boards everywhere, use consultants to aid them in setting the CEO's salary. They look at comparable salaries and tell the consultant they want to be in the upper half of the salary range. Their belief is that you cannot attract top people if you pay a substandard salary. Obviously every organization cannot be in the "upper half"; therefore, CEO salaries have tended to increase.  


There is nothing wrong with compensating CEOs for meeting budget performance objectives. Your argument should be with the WHYY trustees and the objectives they set. If you object to "things like increasing audience share, converting to digital technology, and bringing the budget into line" and believe instead that the CEO should be paid based on something else, you should define it and state how it is to be measured. While a "smell test" might make amusing journalism, it does not provide any objective criteria for determining compensation.

Author's Response

The late Washington sage John W. Gardner observed that when it comes to recruiting key executives, there are only two qualities for which an organization should be willing to pay almost any price: Taste and judgment; “Almost everything else can be bought by the yard.” These, I readily agree, are not objective criteria. But why have a board at all, if not to make subjective judgments? Everything else can be handled by computers.

Wayne Thomas

of Philadelphia, PA on July 17, 2017

Subjective criteria may be appropriate for the policy-setting body (i.e., the board of trustees) when deciding objectives the organization should accomplish. But when it comes to determining whether or not a CEO has met his specific goals and is therefore entitled to a bonus, only objective criteria can be used.  

Richard Goldberg

of Old City/ Philadelphia, PA on July 17, 2017

I agree with Dan that Marrazzo has not achieved the basics. Just because WHYY is the most profitable of major-market public radio stations is not a measure. In fact, his salary is almost 50 percent of WHYY's profits. While his programming contains some of the most successful public syndications, he is not their originator, nor is he anything but a caretaker.
 
Compensating the CEO of a major nonprofit should have nothing to do with profitability. In fact, WHYY is basically devoid of any originality, other than "Fresh Air" and "Radio Times." The lack of originality and innovation does not deserve to be rewarded with the highest compensation of a CEO in the category.

Tom Goodman

of Center City/ Philadelphia, PA on July 26, 2017

It's quite clear Robert Zaller (above) stopped listening to NPR years ago. He hasn't a clue about the values of "Morning Edition," "All Things Considered" and "NewsWorks Tonight."

"Fierce competition" is not the root of good journalism, as Fox News has amply demonstrated. Rather, committed journalists and editors who want depth rather than headlines or propaganda are the keys to good journalism. NPR has these qualities.

Zaller's criticism that NPR aims for a trustworthy neutrality further underscores how an admitted non-listener (How does he arrive at this conclusion? Perhaps he is a closet listener?) is the one who cannot be trusted!

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