This is a repost from John's 2/19 post at the Stanford Social Innovation Review:
Two February 7th Events – One nonprofit rose over $450 million dollars and the other worked toward a goal of $15,000. Which one is the true nonprofit organization?
On February 7th, the Courage Center held its 4th annual benefit for Camp Courage, which offers safe, accessible, natural environments for children with disabilities. Founded in Minnesota in 1928, the Courage Center is a nonprofit organization that set a goal of $15,000 dollars for its Dance with Courage event.
On the same day, the National Football League (NFL), a registered nonprofit organization, successfully raised an estimated $463 million dollars through its annual Super Bowl event, according to Sports Research Institute. The event was seen by over 100 million people and an estimated 112,000 people were in attendance. Some other interesting facts include:
* The highest donation category for the Camp Courage event was the “Mikhail Baryshnikov” level at $100. The Super Bowl sold 30-second commercial advertising space for approximately $2.6 million dollars a spot.
* The NFL’s CEO Roger Goodell is reportedly paid over $10 million dollars, which is approximately three times more than the top nonprofit CEO salary cited by Money Magazine, James Mongan of Partners HealthCare Systems in Massachusetts. Mr. Goodell makes nearly 44 times more than the CEO at the Courage Center according to 990 records.
* The NFL has 13 subsidiaries, seven of them tax exempt. The smallest of the seven tax exempt subsidiaries are those that are dedicated toward philanthropic causes, including NFL Charities and the NFL Youth Fund. Rick Cohen, in his Nonprofit Quarterly blog The Cohen Report (8/12/08), cited that in the 2005 990, the NFL gave away to charitable causes slightly under $10 million dollars. This is approximately one tenth of 1% of its annual revenue. Foundations are required by law to distribute annually at least 5 percent of their net assets.
* The NFL’s 2009 annual revenue is $7.6 Billion dollars, according to Forbes Magazine. That would make it over $2 billion more in revenue than the Mayo Foundation, the largest U.S. charity cited by Forbes. The league’s least valued team, the Oakland Raiders at $797 million dollars, is greater than many large for-profit companies.
Something is wrong with this scenario. I am not sure if the NFL truly complies with the nonprofit corporation definition of operating for educational, charitable, social, religious, civic or humanitarian purposes.
While the proceeds of the Camp Courage event will be dedicated toward advancing the lives of children and adults experiencing barriers to health and independence, the proceeds of the Super Bowl will go to the NFL’s mission of “promoting interests of its 32 member clubs”. The mission statement originally filed by the NFL is unknown. According to Josh Peter of the New Orleans Times-Picayune, the “NFL said it has lost its copy of the application it filed with the IRS in 1942, and the IRS also said it was unable to find a copy of the application.”
I guess this is equal to the dog eating your homework and so I am sure advancing the interests of the Washington Redskins is equal to the missions of organizations like the Courage Center or smaller “folding-table organizations” that earn their non-profit status each and every day.
I am an avid football fan. I played throughout high school and college. I enjoy a Vikings or Jets game on Sundays. That said, there is something very wrong about the NFL being a tax exempt organization and my greatest challenge is how the nonprofit sector can be manipulated in this way. What is even more worrisome is how much more other tax exempt statuses are being manipulated in this fashion.