NEW YORK, Feb. 25, 2011 /PRNewswire/ -- On Sunday, February 13th, Educational Housing Services (EHS) was the subject of a published newspaper report that contained numerous factual errors. The company and its Board present the following information to correct erroneous information regarding the company and its president, George Scott.
As founder of EHS, Mr. Scott is responsible for building the company's revenue in 24 years from $0 to $70 million, enabling EHS to provide affordable housing for more than 200,000 students during that time period. Mr. Scott's compensation package is consistent with the industry standard. In fact, the EHS Board retained the consultancy firm of Towers Perrin to ensure that salary and benefits were in line with other similar nonprofits before unanimously setting the terms of his compensation package.
Statements that George Scott has received an average of $1 million in compensation per year since 2007 are false. The figure is inflated. It also incorrectly stated that he did not have a written agreement in 2008.
In reference to a contract awarded to Student Services Inc. (SSI), a company owned by Mr. Scott's wife, the EHS Board conducted a competitive independent bidding process, without input from Mr. Scott. Bids were solicited from Time Warner, RCN, SSI and others. The Board has relied upon its outside legal counsel, auditors and other advisors for nonprofit compliance and appropriate disclosures.
After reviewing the competitive bids, the Board determined that SSI's bid was the superior one, providing the most service at the lowest cost. Surveys of EHS's student residents have indicated their full satisfaction with SSI's services. EHS has consistently adhered to formal processes intended to ensure that it pays no more than fair and reasonable compensation for services rendered.
EHS compensates its board members for their time and expertise. Nonprofit organizations may reasonably compensate board members, particularly where there are significant demands. Among other things, EHS Board compensation is supported by an independent study. As a complex and substantial nonprofit that supplies affordable housing and related services to thousands of students at numerous locations, EHS requires and benefits from knowledgeable board members with diverse skill-sets. EHS's Board is comprised of established individuals, each of whom is accomplished in his or her respective field.
In addition, the EHS Board engaged James Barnes, Board member (and former Board chair), to assist the company on a full-time basis for the better part of 2009. He was handed the challenging task of dramatically reducing EHS' expenses. Mr. Barnes was formerly the vice president of finance and administration at Ashland University in Ohio, and had substantial expertise in facilities management, budgets, cash flow and personnel-related matters. His efforts assisted EHS with putting in place cost-savings measures of more than $1 million. In one instance alone, he saved EHS nearly $250,000 in negotiated-contract reductions with a local university. The company's independent consulting arrangement with Barnes was exceedingly successful, productive and one that would not have easily been accomplished by another consultant.
Over one year ago, the Attorney General's office contacted EHS to request additional information with regard to an annual report filed with the state of New York. EHS promptly and fully cooperated with that request. Since that time, the Attorney General's office has made no further contact and no official action has been taken.
Educational Housing Services (EHS) is the leading third-party (non-college or university) provider of affordable student housing in the greater New York City metropolitan area, providing safe, affordable, quality housing for more than four thousand students annually. It was recently selected one of the "2011 Best Non-Profit Organizations to Work For" by The Non Profit Times.
SOURCE Educational Housing Services