Show Me the Money: USTA Financial Data

I have noticed that I have been inflicting a lot of conversation about this site’s current topics on those around me on a fairly relentless basis. It’s just where my head is at right now. This week as one of my drill groups was waiting for our court to open, the subject of Community Tennis Associations (CTAs) was raised.

When I commented that CTAs were required to be incorporated as non-profit organizations, an attorney in our group shared that in his experience working with non-profits can be shockingly contentious. He told us that we would be amazed at how worked up people sometimes get over relatively small sums of money in non-profit settings.

Small sums? This naturally made me start to wonder about the financial relationship and linkages between the USTA Section Offices and the CTAs in their jurisdiction. I had only taken a few steps down that path before I realized that I needed to focus first at the USTA Section Office level. Since I am in Texas, naturally that is the one that I examined.

Non-profit organizations are required to file IRS Form 990 every year which is open to public inspection. (Forms for 2019 are generally not yet available due to the COVID-19 tax filing extension, so I am relegated to looking at stale 2018 data.) USTA National, USTA Texas, and all of the CTAs are independent non-profit organizations. As such, they are required to file Form 990 with the IRS. They are also required to make these forms available for public examination. Hey, that’s me!

When I was in business school, one of my most influential professors constantly preached that if you really want to understand an organization, you have to follow the money. A non-profit organization, by definition, was created to promote a specific cause. The public mission statement is one thing and the money that is spent is something else. Theoretically, there should be close alignment between the two and most of the time it is.

I should pause right here and say that for the National USTA and USTA Section Offices, I have little doubt that the alignment between stated objectives and finances is tight. Even with that assumption in place, examining the financial data can illuminate the details about implementation of the stated objectives.

In 2018, USTA Texas reported revenues of $6.17 and expenses were a little over $6 million. Revenue minus expenses comes in at about $146 thousand. That is a much higher volume of cash than I would have anticipated or guessed.

The majority of the USTA Texas revenues came from tournaments and leagues which are combined as a single line item at a little over $2.2 million. Membership dues pulled in an additional $726 thousand. Comparing that number to form 990 for the USTA National, membership dues were $18.5 million. I am assuming that the Texas Section office receives a portion of the membership dues based on member participation. It is approximately 4% of the overall USTA membership fees.

The CTAs that received grants from USTA Texas in 2018 were the Abilene Tennis Association, Arlington Tennis Association, Capital Area Tennis Association (Austin), Dallas Tennis Association, Fort Worth Tennis Association, Houston Tennis Association, San Antonio Tennis Association, and the Waco Tennis Association. The amounts ranged from $5,250 to $22,150.

There are a lot more CTAs in Texas than the ones that received grants from the USTA Section Office. I have sampled enough 990s from those organizations to have a sense of the alternate revenue, but that is a topic for a future time.

Up until this point, I had been viewing the relationship between USTA National, the USTA Section Offices, the USTA CTAs, and the players primarily through the lens of authority and jurisdiction. There is also a financial relationship that can’t be completely neglected.

I am challenged to frame out what I learned from this exercise. Examining the 990s certainly game me a much sharper sense on the finances associated with the USTA promotion of tennis. It also makes me realize what an advantage organizations without a public obligation to promote and grow the game enjoy. Think UTR.

1. USTA Texas, IRS Form 990, 2018.
2. United States Tennis Association, IRS Form 990, 2018.