Tax Docs: USSA Chief Got Five Percent Pay Cut in 2010

United States Ski Association (USSA) Chief Executive Officer Bill Marolt took a five percent cut in base compensation and benefits in the 2010 fiscal year, according to federal tax forms recently released by the Internal Revenue Service.

In both 2010 and 2009, Marolt received a $250,000 bonus from USSA and its affiliate organizations. In the last fiscal year, however–which ended April 30, 2010–his base pay decreased from $309,947 to $269,258, while his benefits and nontaxable compensation increased from $92,000 to $98,553.

A spokesperson told FasterSkier that Marolt declined to comment on his salary, and he did not respond to an email.

But in an interview, USSA Board Chairman Dexter Paine, a former alpine racer who now heads his own $2.7 billion private equity firm, said that the decrease was a reflection of across-the-board salary cuts instituted by the organization in January, 2009, at the peak of the financial crisis.

Those cuts have since been eliminated, according to Paine. “We actually returned everyone [in 2011] back to the level that they had prior to the pay cuts,” he said.

But in the mean time, Marolt was buffered from the reductions by his $250,000 bonuses. Marolt also receives non-monetary benefits, like the use of two Audi cars, and the tax forms show that USSA executives are offered first-class or charter travel for themselves and a companion.

As is the case every year, it was the USSA board that made the decision on how much to pay Marolt.

“We have a board,” Paine explained. “That board is made up of approximately 20 people, approximately a third athletes, a third people from the industry, and a third outside board members. We [also] have a compensation committee. That compensation committee sets goals and objectives for Bill.”

If Marolt meets the objectives, then he is rewarded with a sizeable bonus. For the 2010 fiscal year, the goals were to run a budget surplus, and to achieve particular performances at the Olympic Games. Since Marolt accomplished both – thanks in part to the success of the American nordic combined team – he was awarded the $250,000.

Acording to Paine, USSA settled on that figure, as well as the base salary, using a study that examines the compensation for leaders of other organizations, including CEOs in private industry, athletic directors, and college coaches.

“That’s what Bill did before he came to us, so we think that’s a quite comparable data point,” Paine said. “We look at compensation for heads of other national governing bodies.”

Documents from the IRS show that Marolt’s total compensation is higher than that of any other CEO for a winter Olympic sport organization, including that of Dave Ogrean, the executive director of USA Hockey. USA Hockey had 585,000 members to USSA’s 30,000, and collected $33.8 million in revenues in 2010 compared to USSA’s  $19.7 million, while Ogrean received approximately $335,000 for his work.

As for athletic directors, the best-payed can make in the $1 million range. But salaries fall sharply away from the football- and basketball-centric conferences like the Southeastern Conference, Atlantic Coast Conference, Big 12, and Big 10.

The University of Utah, for example, has an athletic budget of over 26 million dollars, and employs roughly 160 staff members (USSA employs 200). Despite the big budget, athletic director Chris Hill had a salary of only $314,768 in 2009; the big bucks were reserved for the football coach, who was paid over a million dollars.

Paine, however, stood by Marolt’s figure.

“[Marolt] is well compensated—certainly not the highest-compensated national governing body member out there—but in terms of performance, I’d argue that he’s the best-performing CEO of any NGB,” Paine said, citing Marolt’s success as a fundraiser for the U.S. Ski Team.

“For another example, the head of USA Tennis…made a million three last year. The temporary head of the USOC [U.S. Olympic Committee], Stephanie Streeter, made over a million dollars. Quite frankly, we think that the group I just talked about is a relevant group, in terms of comparisons,” Paine said.

USSA pays four other employees over $100,000. They are led by Chief Financial Officer Mark Lampe, who receives $112,077 from USSA and $131,596 from related organizations. Others include Vice President of Events Calum Clarke, Controller Chris Sampson, and Vice President of Marketing Edward Morris.

The Big Picture: Programs

While Marolt’s compensation decreased slightly, USSA’s overall financial standing appears to have been steadily improving over the last few years. In the 2010 fiscal year, revenues increased from $18,484,671 to $19,766,542, according to tax documents.

“I think that we started to see revenues come back,” Paine told FasterSkier. “This year, revenues were up, and they are budgeted to be up slightly again next year, but sports marketing dollars remain very tight. I think it’s the last piece that comes back…There have been slight increases, so we’ve been able to increase our athletic spending.”

In 2010, domestic athletic support decreased from just over $4 million to $3.75 million, while grants to the ski and snowboard national teams dipped to $6.2 million from the previous year’s $6.9 million. However, on the whole, program spending increased by some $400,000.

One reason that was possible in 2010 was the Vancouver Olympics.

“The money that we got from the USOC was up slightly last year, because it was an Olympic year,” Paine explained. “But those moneys remain essentially flat.”

In the future, though, the USOC money will be stretched even more thinly. At least three new ski and snowboard events have been added for the Sochi Olympics: women’s ski jumping, and men’s and women’s ski halfpipe have been approved, while men’s and women’s slopestyle was tabled at the spring meeting of the International Olympic Committee, but could be reconsidered again before 2014.

“We get new sports and no new money, which means that you end up spreading dollars over more athletes, and it’s just a real challenge,” Paine said. “Every year, we have to figure out where we are going to allocate dollars among all the different programs.”

Aside from USOC money, USSA generated $3.4 million in revenue from memberships and fees, and as well as some $961,000 from event registration. Sponsorships brought in over $7.4 million–but in its annual report, USSA showed that it spent more than 20 percent of its budget on sponsor and donor fulfillment.

“It’s certainly a challenging environment, from a revenue perspective,” Paine said. “We continue to work very hard to expand our sales marketing base, and expanding our foundation, which is where we raise money from donors. But certainly, the environment is still challenging out there.”

Goals for the Future

In order to continue receiving his large bonuses, Marolt will have to keep meeting USSA’s objectives.

The main thing, Paine said, is to keep raising money.

“Our goal is to continue to generate more revenues,” he told FasterSkier.

Specifically, USSA is focusing on fundraising for two major projects. The first is an early-season training site at Copper Mountain in Colorado, which will serve the alpine, freestyle, and snowboard teams.

“We are close to putting that deal together. By November 1, we’ll have an automated snow system, and all the necessary safety, communications and timing equipment to have a world-class downhill speed center like no other around,” Marolt told Ski Racing Magazine at the 2011 USSA Congress. “What we will have will be a game changer, to have an opportunity to be on world-class snow by the first of November until the middle of December for the elite programs, and then after that, it will be totally for the development programs.”

The second focus, which is more relevant to the nordic program, is a continuing commitment to education.

“One of the areas that Bill has really focused on is getting athletes access to education while they’re competing, through a program we have at Westminster, as well as other universities,” Paine told FasterSkier.

Several of the nordic athletes are taking classes at Westminster College in Salt Lake City, which provides full tuition to U.S. Ski Team athletes, and Torin Koos is taking advantage of a similar deal with the University of Utah.

USSA also offers a tuition reimbursement program for athletes attending other schools. For language learning, specifically, athletes have free access to Rosetta Stone online courses, and USSA pays for interested skiers to attend ten-day intensive language classes with Dartmouth College’s Rassias Program in Hanover, NH.

“We now have 68 athletes who are going to school at the same time that they’re competing, which is a dramatic increase over when Bill [arrived],” Paine said.

“And we want to increase that even more, so our next step is going to be to raise endowment money to be used for education… The stronger the alumni base of our organization, the stronger our organization will be, going forward. To the extent that we can do more for our athletes, regardless of what sport they’re in, the better job we do serving them.”

While the combination of education and collegiate skiing has been a hot topic in the nordic community over the last few years, Paine was clear that as far as he’s concerned, there’s no reason to eschew school, and he added that USSA is dedicated to making education possible for its skiers.

“It keeps athletes from being forced to make that decision of: ‘Do I go to school, or do I compete?’” he said. “I grew up ski racing, and I wasn’t good enough to have to make that decision, but I made the decision to go to school, and certainly knew lots of athletes who were in a difficult position, trying to figure out, ‘geeze, what do I do?’”

–Nathaniel Herz contributed reporting.