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IHSA tournament profits tumble as employee salaries rise

7 months ago Chicago Sun-Times

Legislative hearing on organization's operations set for Tuesday

From Chicago Sun-Times:

Even as pack-the-house players like Derrick Rose, Jabari Parker and Marcus Jordan led their teams to state titles in recent years, the Illinois High School Association has seen revenues and profits from its marquee state boys basketball tournament plummet.

Between 2006 and last year, profits from the tournament fell by 29 percent, government records filed by the IHSA show. Revenues — mostly from ticket sales — decreased by 17 percent between 2009 and last year.

IHSA spending on salaries and employee benefits, meanwhile, is up 21 percent in just one year’s time, according to the private, not-for-profit group’s most recent filing with the Internal Revenue Service.

The mix of declining boys basketball tournament revenues and escalating personnel costs has some coaches and school administrators befuddled.

“We have had the greatest high school players in the country over the past five years,” says Tyrone Slaughter, boys basketball coach at Whitney Young High School, Class 4A state champions this year and in 2009. “And they are making less money? That doesn’t make sense.”

Slaughter sees it as a sign that the association, which faces a state legislative hearing Tuesday, is “stuck in the old way of doing things.”

The IHSA oversees sanctioned high school sports and academic contests involving more than 800 member schools statewide. It’s come under fire in recent months for its handling of high-profile decisions involving athletes’ and teams’ eligibility.

Behind the scenes, a larger, if less public, debate has been building over the nearly $11 million the association takes in and spends each year.

Some school administrators are questioning whether they should get a bigger slice of the pie from ticket revenues, sponsorship deals and broadcast rights to IHSA events. And they’re finding support from state lawmakers, who point out that, even though the IHSA isn’t funded by taxes, more than 80 percent of its members are taxpayer-funded public schools. 

Examining the IHSA’s finances over the past 10 years, the Chicago Sun-Times found:

◆ Personnel costs are on the rise. Of the nearly $11 million the IHSA spent in the 2012-13 school year, nearly $3.1 million went for “salaries, other compensation [and] employee benefits,” according to its most recent IRS filing — a 21 percent increase over the $2.5 million-plus the organization spent the year before. IHSA Executive Director Marty Hickman had no explanation for this, other than to say that “salaries and benefits would have increased at a much more moderate rate” and he would need to discuss the matter with the association’s accounting firm.

◆ It’s facing skyrocketing expenses for pensions, paying hundreds of thousands of dollars a year into its $8.7 million pension fund — for which it isn’t required to identify pensioners or the amounts they get. Last school year, the IHSA paid $425,000 into the plan, which paid out $590,911 to retirees. The rise in pension expenses — projected at more than $7 million over the next 10 years — prompted it to switch employees to a 401(k) plan as of July 1, 2008.

◆ The boys basketball tournament — the IHSA’s signature event — made $1.1 million last year, $463,799 less than it did in 2006, when it turned its biggest profit. That 29 percent decrease came as Illinois teams, in particular Rose’s and Parker’s South Side alma mater, Simeon, were attracting national attention.

Boys basketball tournament revenues, the amount the IHSA took in from the event, totaled a little more than $2 million last year. That’s 17 percent less than when revenues hit a high of $2.45 million in 2009.

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