Because USPSA is largely funded by membership dues and entry/classifier fees paid by the shooters, the most important part of our examination of USPSA’s finances is how they’re spending that money. Yesterday’s post covered USPSA’s revenue streams, so today we should look at where it’s all going.
Expenses are reported on the form 990 in two places – the first is a section that has the organization (in this case USPSA) list their four largest program service expenses, the revenue generated by those expenses, and a brief description of them. For example, on the 2013 return it lists National Championship Matches as costing $576,114 to put on, and generating $357,440 in revenue. From this we can deduce a couple of things: first that the “Entry Fees” revenue item definitely includes classifier fees, and secondly that USPSA loses money on the Nationals.
Unfortunately, the expenses reporting is fractured, because if you scroll further down the report, there’s no line item on page 10, Statement of Function Expenses for “Nationals.” Statement of Function expenses is where traditional expenses are reported, things like compensation of key employees, comp of all other employees, office expenses, travel expenses, etc. For example, in 2013 USPSA spend $210,000 on compensation for Directors and key employees, and $287,000 on salaries for all other employees. That makes a total of $497,825 on employees, not including payroll taxes, 401k contributions, and “other employee benefits.” Sticking with 2013, USPSA also spent over $300,000 on office expenses, and another $300,000 on travel.
Looking at key salaries for the moment, everyone knows that the Area Directors are not paid employees of USPSA. They serve on a volunteer basis. The Key Employees/Directors that do receive compensation are the President of USPSA (currently Phil Strader), the Executive Director (Kim Williams), and the Vice President (John Amidon). Their salaries on the 2013 return are reported as $55,000 for the President, $56,844 for John, and $98,760 for Kim Williams. I don’t think anyone would begrudge Phil and John their relatively small salaries, considering the amount of work that goes into both of those positions. I do wonder about the ED’s salary – in his last year as Executive Director, Dave Thomas was making basically the same amount as Kim Williams is in her first year as ED. I’m not saying that the salary is too high, but that does strike me as odd that a new employee would be hired at basically the same rate as the long-tenured outgoing employee.
Now, here’s where things get confusing – as I mentioned above, there’s no line item for “nationals” on page 10 of the report. So we have to assume that the $500k spend on Nationals is a combination of all these factors; and I’d be willing to further assume that a decent sized chunk of that is travel. But this raises the question: why can’t USPSA run a profitable Nationals? Every single other return shows USPSA losing money on the National championships as well. But here’s the further interesting part – sponsorships aren’t recorded on this form separately, so there’s no way to tell if USPSA isn’t reporting the cash donations given to Nationals by various companies to sponsor the match. It’s feasible that because of the way those are set up, it’s not considered reportable revenue; which would mean that it’s impossible for shooters and members to get a true picture of 1) How much Nationals costs to put on and 2) whether or not USPSA loses money on it.
In order to keep this posts short, I’m going to break the examination of expenses down into a couple more parts. Tomorrow we’ll look at “Program Service” expenses; which are listed on page 2 of the report, and on Monday we’ll take a deep dive into salaries, office expenses, etc.