NOTHING CHANGES AT THE USTA, SO THE SPORT IS DOOMED BY THE SAME USTA. by Javier Palenque
Javier Palenque
GLOBAL BUSINESS CONSULTANT | FAMILY BUSINESS EXPERT | GLOBAL BUSINESS TRADE EXPERT
Ten years ago the NYT published an article called "A board woven with conflicts" in which the inside dealings of the USTA were exposed to the press. Today things are not much different other than the fact that all that the Chairman and CEO have accomplished are:
There is only one solution for tennis to be saved, and that is for the Chairman and board and CEO to resign. But since it is a closed club of incapables, they will take the sport down with them and never allow dissent to challenge their limited thinking. If you do not believe me, all you have to do is to read the article from 2014 and reach your own conclusions. The same themes are touched a decade ago. The problem today is that the average coach's age is 65 and the average tennis player's age is 65. That is retirement age, and the board, still does nothing about it.
I hope the PR person publishes this article while claiming unheard of growth amongst people that don't play and funds that never help anyone other than themselves.
I say NO to ineptitude and YES to growing the game.
I can be reached at jpalenque@yahoo.com
A Tennis Board Woven With Conflicts
By Mary Pilon and Andrew W. Lehren
Jeff Williams, the longtime publisher of Tennis Media Company, sits on the board of directors of the United States Tennis Association, the sport’s governing body and the organizer of the star-studded United States Open.
Williams’s company is also the U.S.T.A.’s single largest contractor, having received $2,782,700 in 2012, a relationship that the U.S.T.A. has not clearly disclosed in its public filings.
When this year’s Open begins Monday, the U.S.T.A. is almost certain to be criticized over the sad state of American tennis. No American man has won a major singles title in more than a decade, and only one American player, Serena Williams, the No. 1 women’s player, is ranked in the top 10 in the world in singles.
The U.S.T.A.’s finances are an issue, as well.
An examination of those finances by The New York Times shows that several of the group’s current and recent board members have benefited from U.S.T.A. grants and contracts, raising questions about the unofficial perks available to the men and women at tennis’s highest rungs.
The Times reporting shows that:
■ The Junior Tennis Champions Center in College Park, Md., received more than $840,000 from the U.S.T.A.’s charitable wings over the last three years. Ray Benton, a U.S.T.A. board member, is the chief executive of the center.
■ John Korff, who owned the New York City Triathlon, sat on a U.S.T.A. board that approved a $50,000 grant to Life Time Fitness, a health club chain. Months later, Life Time bought Korff’s company for an undisclosed sum.
■ Katrina Adams, the first vice president of the U.S.T.A. board, is also the executive director of the Harlem Junior Tennis and Education Program. That group has received at least $217,550 from the U.S.T.A. and its charitable operations in the nine years since Adams joined the U.S.T.A. board.
Chris Widmaier, a spokesman for the U.S.T.A., acknowledged that the U.S.T.A. sometimes contributed money to its members’ causes and companies. But he said that was unavoidable in the small world of elite tennis.
“You’d be kind of hard pressed to find someone with that kind of tennis expertise that might not have interacted with the U.S.T.A. at some point,” Widmaier said.
Board members said that they had played no role in steering money to their own organizations and that in many cases the financial arrangements had predated their time on the board.
Gordon Smith, the executive director of the organization, defended its board as a group of impassioned advocates for the sport.
“A lot of people who are involved in the U.S.T.A. are willing to do things because they love the game, not because they’re trying to get something out of it or because they want to get some funding,” he said. “That’s not the issue.”
The U.S.T.A. is classified for tax purposes as a 501(c)6 organization, meaning it is not a charity but rather a nonprofit group, akin to a chamber of commerce or the N.F.L. That means the organization is largely exempt from paying federal taxes on about $213 million it generates in revenue, much of which comes from the United States Open, by far the group’s biggest event.
The U.S.T.A.’s national board sits above three national charities dedicated to goals like player development and helping disadvantaged athletes. It also oversees 17 regional chapters, as well as a lower level of state and local boards. Most of those organizations are set up as distinct nonprofit groups.
Experts on nonprofit groups said that the cozy connections at the U.S.T.A. raised concerns about conflicts of interest on the board, particularly because the organization had not clearly publicly disclosed any of the relationships.
“You begin to ask questions,” said Frances Hill, a professor at the University of Miami School of Law who has studied tax-exempt organizations. “Aren’t there any people out there who understand tennis who don’t need to have a deal and can just serve on this board and maybe get some tickets?”
The U.S.T.A. spends roughly $200 million a year on salaries, grants to tennis organizations, operating costs and outside contracts. But The Times was able to determine that at least $3.1 million of that annually goes to organizations with ties to board members.
No one received more from the U.S.T.A. than the Tennis Media Company, the publisher of Tennis magazine and Tennis.com, the country’s most widely read tennis media outlets, with an audience of 30 million.
In 2012, for roughly $2.8 million from the U.S.T.A., Tennis Media sent copies of the magazine, along with a digital package, to the organization’s 780,000 members.
Williams said that even though he was an active U.S.T.A. board member, he had played no role in the decision to send the organization’s funds to his company.
“Getting into the weeds of who gets a grant and how much, I stay out of that,” Williams said. “The relationship between Tennis magazine and the U.S.T.A. was one that existed long before I joined the board.”
Widmaier said that Williams played a crucial role on the board but that he kept his roles as board member and media executive separate. “Having an expert in media is helpful to us,” Widmaier said. “He does not interact with staff as it relates to the business of Tennis magazine and the U.S.T.A.”
To see where some of the organization’s funds are spent, visit the Junior Tennis Champions Center, one of the largest recipients of U.S.T.A. money.
The exclusive training center has a first-class pedigree and is often lauded for working with underprivileged athletes.
It was founded by Kenneth Brody, an investment banker who was appointed by President Bill Clinton to head the Export-Import Bank of the United States. Benton, the center’s chief executive, knows many people in the sports world, having been a founder of ProServ, once a leading sports agency that represented Michael Jordan, Boomer Esiason and Dave Winfield.
Junior Tennis Champions is one of the largest and most established of the many training centers financed by the U.S.T.A.
On a recent afternoon, the 32 indoor, outdoor, hard and clay courts were buzzing with young players in tennis whites. A flat-screen television in the lounge showed professional tennis matches, while the names of junior champions who have graced the courts lined the halls. The freshly manicured lawns were as spotless as the impeccably maintained courts.
Two large U.S.T.A. charitable organizations, U.S.T.A. Player Development and U.S.T.A. Serves — which are overseen by the national board, on which Benton sits — have given Junior Tennis Champions $840,000 over three years.
Benton said that he had not been involved in the decisions to fund the center. The national board oversees the lower-level boards but does not decide how boards of the two charities distribute their funds, he said.
The center relies on revenue from people paying for the use of its tennis courts and on grants from organizations like the U.S.T.A. Benton defended his program as an elite organization and a worthy grant recipient that will have four competitors in this year’s United States Open Junior Championships.
“We’ve been one of the top training centers in the country for years,” Benton said.
Benton is not the only U.S.T.A. board member whose interests have aligned with the organization’s grant distribution.
Harlem Junior Tennis has received $217,550 since 2005, when its executive director, Adams, a former professional tennis player, joined the U.S.T.A. board.
But Adams said she had had nothing to do with those grants. Her work on the board did not include any role in the grant distribution process, she said, and the Harlem program received U.S.T.A. money before her involvement with the organization. “The board is very separate from those programs,” Adams said.
John Korff founded the New York City Triathlon more than a decade ago. In 2012, he was on the U.S.T.A. and Player Development boards. That same year, Player Development gave a $50,000 grant to Life Time Fitness, one of the nation’s largest operators of tennis facilities.
About eight months later, Korff sold the triathlon to Life Time Fitness for an undisclosed sum.
Korff, who left the U.S.T.A. board shortly after the grant to Life Time Fitness was awarded, dismissed the timing as coincidence. He said the triathlon negotiations had not begun until after he left the tennis boards.
“There’s no insider trading, or whatever you would call it,” Korff said.
“You would never want to mix your business and their business,” he added. “I cannot think of anything that would be more unconscionable.”
Korff cautioned that the appearance of conflict was unavoidable in the small world of competitive tennis.
“You think there’s a million people, but when you are involved, you realize everyone could fit under one tent,” he said. “It’s kind of a small thing.”
“Does the board suffer from insularity? A little bit,” Korff added.
The New York Times Company is a corporate sponsor of the United States Open.
The U.S.T.A. has annual revenue of about $213 million, but critics argue that the money has done little for American tennis. The days of American tennis supremacy — Chris Evert, Jimmy Connors, John McEnroe, Andre Agassi, Pete Sampras — seem like a distant memory.
The last American man to reach the singles final at Flushing Meadows was Andy Roddick in 2006. Serena Williams, who has won the tournament five times, is the only legitimate American singles contender at this year’s Open. Williams and Roddick did not rise through the U.S.T.A.’s player development program, but with independent coaches.
The U.S.T.A., meanwhile, continues to thrive financially. ESPN will pay $825 million over 11 years for the television rights to the Open. Some courtside tickets cost more than $1,500, and luxury suites go for tens of thousands of dollars. Blue-chip companies like JPMorgan Chase pay millions of dollars to sponsor the tournament.
In a lease arrangement with New York City, the U.S.T.A. pays $400,000 a year, plus 1 percent of its revenue — a total of roughly $2.5 million last year — for the city’s 46.5-acre Billie Jean King National Tennis Center in Queens.
Smith, the U.S.T.A.’s executive director, said, “the city has the best deal of anybody.”
He added that the organization’s board members provided crucial services.
“Just because they have an interest in tennis doesn’t mean that they don’t bring tremendous knowledge from other walks of life that they’re interested in,” he said.