DENVER — At least 70 percent of U.S. Olympic sports organizations have applied for government funds during the coronavirus pandemic, a stark financial reality that underscores the frailties within the world’s most dominant Olympic sports system.
The Associated Press surveyed 44 of the country’s national governing bodies — the organizations charged with operating programs from the grassroots through the Olympic levels in sports that run the gamut from badminton to basketball.
All but four of the 36 governing bodies that responded said they had applied for assistance from the Paycheck Protection Program. Not all the organizations revealed how much they received, but those that did have been approved for a cumulative total of about $12 million.
Beginning in July 2021, when the delayed Summer Olympics are scheduled to start in Tokyo, U.S. governing bodies will send a total of around 1,150 athletes to two Olympics and two Paralympics over seven months. While World Cup champion skier Mikaela Shiffrin, record-setting gymnast Simon Biles and the U.S. basketball teams are among those on solid financial footing because of their star power and marketability, the United States will depend on dozens of lesser-known athletes to dominate the medals table in Tokyo and at the scheduled 2022 Winter Games in Beijing. It puts the U.S. Olympic and Paralympic Committee and the governing bodies on an urgent track to fund all the potential medalists, many of whom haven’t been able to train properly for months.
“There’s a very, very real and dire financial situation in sport,” said Sarah Hirshland, the CEO of the USOPC, which oversees the governing bodies. “And certainly, the sports organizations we work with closely are feeling revenue pain. And it’s immediate.”
The results of the survey were eye-opening, not only because of the sheer number of governing bodies that applied but also because the requests for federal money counter the long-held and distinctly American tradition of not using taxpayer money to pursue Olympic glory.
Sports federations in most other countries are buttressed by government financial assistance. The U.S. team, which has amassed a world-leading 653 medals in Summer and Winter Games since 2000, relies on broadcast fees, sponsorships, charitable donations, and revenue from programming and memberships.
But without the revenue generated by normal day-to-day business — to say nothing of an NBC cash infusion of at least $170 million that would’ve gone into the USOPC coffers this year had the Tokyo Games not been postponed — the financial model of the U.S. Olympic sports system is imperiled.
Last month, Hirshland said the USOPC board was aiming to trim this year’s expenses by as much as 20 precent. It has committed to sparing the governing bodies from the cutting block for 2020 but also warned that a full cancellation of the Olympics — a possibility not being ruled out — would be “devastating” for U.S. sports.
The level to which governing bodies rely on USOPC funding varies, based largely on their size. Even without any USOPC-related cuts in 2020, some of these organizations are teetering on the edge of financial solvency. They’re missing millions in revenue from events, membership dues, clinics and other fee-based operations that keep organizations and their sports running. A survey earlier this year estimated they would endure a collective revenue shortfall of $121 million from February through June because of coronavirus-related shutdowns.
“We all are exposed, but to be really candid, it’s probably what it should be,” said Max Cobb, president of US Biathlon, who also leads the National Governing Bodies Council in the United States. “We’re all nonprofit organizations. We put all the revenues back into our sports programs. In only a few cases have (governing bodies) been able to develop a significant contingency fund.”
A number of governing bodies didn’t divulge the full details of their government funding requests in the Associated Press survey. Those that did received amounts ranging from $2.5 million (US Ski and Snowboard) down to $75,000 (USA Badminton).
A plurality of those that responded received loans in the middle six figures. Those amounts reflect the modest sizes of the organizations, many of which have fewer than a dozen employees who are responsible for all aspects of their sports, from nurturing Olympic dreams to tending to the grassroots that grow in towns and cities across the country and, eventually, produce Olympians.
• USA Cycling, one of the first governing bodies to announce it was cutting staff, did not give a dollar amount in the Associated Press survey but said it received enough from the government to cover four weeks of staffing and overhead costs.
• USA Swimming received $1.6 million to cover payroll. That governing body is reliant largely on membership-related fees and doesn’t expect to know the full impact of the coronavirus until the fall, when the bulk of its membership renewals come up.
• USA Gymnastics made an undisclosed number of furloughs and cut pay, but because it is in bankruptcy in the aftermath of the Larry Nassar sex-abuse case, it was not eligible for the federal program.
The USOPC, always wary of asking the government for cash, directed governing bodies to look into securing money from the government program. All efforts, Hirshland said, have been geared toward “supporting sports at a community level and supporting the (grassroots) pipeline” that leads to elite sports.
The push for government help in Olympic circles is part of a larger debate as to whether sports should be going after this money at all, given the massive devastation in the economy. The NBA’s Los Angeles Lakers received a $4.6 million government loan but gave it back after public backlash.
Olympic organizations don’t have the huge, long-term TV and sponsorship deals that make pro teams and leagues profitable. Annual revenue for an average NBA team in 2018-19 was $292 million. Only three national governing bodies cleared more than $50 million in 2018.
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