★ The Sports Examiner: Chronicling the key competitive, economic and political forces shaping elite sport and the Olympic Movement.★
★ To get the daily Sports Examiner Recap by e-mail: sign up here! ★
≡ USA TRACK & FIELD ≡
USA Track & Field posted its 2023 financial statements and IRS Form 990 tax return on Tuesday, 24 December, with the statements confirming a staggering drop of $13.46 million in net assets over two years:
● 2021: $8.53 million in USATF net assets shown
● 2022: $548,002 in USATF net assets shown
● 2023: –$4.93 million in USATF net assets shown
● Loss of $13.46 million from 31 December 2021 to 31 December 2023
The 27-page financial statements start with a cover note that addresses the financial downturn:
“The 2023 Audited Financial Statements include both cash and non-cash transactions which impact the decrease in net assets. These include a decrease in value-in-kind (non-cash) assets (approximately $3.0M) and a decrease in cash (approximately $1.8M, driven by one-off operational expenses, as approved by the Board of Directors.
“This includes residual obligations related to 2022 World Athletics Championships, including expenses related to the 2023 Diamond League Final; prepayment of housing for coaches and team staff for the 2024 Olympic Games; expenses related to training facility track improvements for the 2024 Olympic Games; significant increase in insurance costs without concomitant increases in member fees; legal fees related to unplanned litigation; and the USATF Grand Prix series.”
The drop from 2021 to 2022 was from a $9.9 million subsidy paid to the Oregon22 organizers for the World Athletics Championships held in Eugene.
The expense side of the USATF activities statement showed less spending in 2023 than in 2022, thanks to a much lower cost for the World Championships in 2023 (Budapest: $1.46 million) vs. 2022 (Eugene: $7.75 million). But overall spending – mostly for elite-athlete competitions – has ballooned over the past two years:
● 2021: $35.52 million total ~ Olympic year
● 2022: $45.58 million total ~ Worlds in Eugene
● 2023: $42.17 million total ~ Worlds in Budapest
● 2021: $11.16 million for Elite competitions ~ Olympic year
● 2022: $20.92 million for Elite competitions ~ Worlds in Eugene
● 2023: $15.81 million for Elite competitions ~ Worlds in Budapest
Note 1 to the financial statements added some detail to the added expenses in 2023:
“[S]ignificant funds were invested in the Diamond League-2023 Prefontaine Classic which provided vital competitive opportunities to prepare athletes for global competition. USATF’s expenses highlight critical, board-approved investments such as the USATF Grand Prix meets. These events provided prize money, travel support and world-ranking opportunities for athletes, resulting in many of those athletes competing in the 2023 World Championships and qualifying for the Paris 2024 Olympic Games (ultimately resulting in a record medal count for USATF).”
Comparing the 2021 costs to 2023 (ignoring spending on a home World Championships in 2022):
● 2021: $2.192 million in Services and Professional fees
● 2021: $4.379 million in Grants and Support payments
● 2021: $1.606 million in Travel
● 2021: $1.172 million in Supplies and Shipping
● $9.349 million for these four categories
● 2023: $5.005 million in Services and Professional fees
● 2023: $4.037 million in Grants and Support payments
● 2023: $2.852 million in Travel
● 2023: $1.937 million in Supplies and Shipping
● $13.831 million for these four categories
That $4.482 million cost increase accounts for most of the losses in 2023.
In terms of revenue, the statements note that 53% of USATF revenues ($19.45 million) came from one sponsor (Nike) and 16% from the U.S. Olympic & Paralympic Committee grant of $5.827 million. That’s 69% from two sources
With the difference in accounting methods between the Federal Form 990 tax return (mostly cash) and the financial statements (accrual), the financial statements show a higher revenue total for 2023: $36.71 million vs. $35.01 million on the tax return.
Even so, USATF revenues in 2023 remained in the same narrow range – excepting the pandemic year of 2020 since the decades-long, current Nike sponsorship package came into effect in 2014 (figures from financial statements):
● 2014: $35.05 million
● 2015: $30.40 million
● 2016: $38.43 million
● 2017: $33.67 million
● 2018: $36.71 million
● 2019: $37.24 million
● 2020: $23.30 million (Covid impact)
● 2021: $35.52 million
● 2022: $36.54 million
● 2023: $36.71 million
If inflation is taken into account, the situation is even worse. One dollar in 2014 is worth about $1.33 today, so the $35.05 million revenue from 2014 represents $46.61 million in 2024. But USATF revenue has advanced by just 4.7%.
The federation nevertheless made it through 2024. It had $11.89 million in cash and investments at the end of 2023 and $3.1 million remaining on an $8.0 million line of credit. But it is hardly comfortable.
In Note 1 of the statements, a sentence was added noting:
“Management and the board of directors have introduced a range of revenue-generating and cost-cutting initiative to address its financial position as part of its post-2024 Olympic Games and 2025 business strategy.”
In this regard, on 9 November 2023, USATF announced that chief executive Max Siegel was given a contract extension through 2028.
¶
Even in the protective language of its own financial statements, USATF is in financial difficulties, presenting the new Board and new President Curt Clausen with substantial challenges.
It’s worth comparing the situation of the two major U.S. Olympic medal-producing federations, USATF and USA Swimming. The swim federation lists audited financial data back to 2017 and released its 2023 financials earlier this year:
● 2017: $43.09 million revenue
● 2017: $75.86 million in assets
● 2017: $57.71 million in reserves
● 2023: $45.23 million in revenue
● 2023: $70.39 million in assets
● 2023: $45.02 million in reserves
The swimmers have had their own tribulations over finance, but receive a majority of their funding from memberships have more than 375,000 members, and is still quite healthy financially. But its revenues have also not kept pace with inflation.
USA Swimming’s chief executive, Tim Hinchey, who joined in 2017, was dismissed in August over a lack of trust within the organization, especially from coaches. The organization is looking for a new chief executive now.
¶
★ Receive our exclusive, weekday TSX Recap by e-mail by clicking here.
★ Sign up a friend to receive the TSX Recap by clicking here.
★ Please consider a donation here to keep this site going.
For our updated, 885-event International Sports Calendar for the rest of 2024, 2025 and beyond, by date and by sport, click here!
