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It’s that time of year. The NHRA has to release their tax returns for last year and we at DRO have to take a look at them and pass the information on to our readers. Sometimes the figures upset our readers and this year’s will be no exception. Having said that, we suggest you take the numbers in this year’s returns with a grain of salt as they really don’t reflect what the NHRA and the rest of us have experienced since October of 2008!
NHRA’s tax return actually makes for some pretty interesting reading if you have already read the Playboy interview and your latest copy of Garage magazine.
As we always do, let’s take a look at how Tom Compton and his team did with the business in 2008 compared to 2007. Total revenues for 2008 were reported to be $122,564,365. That number in 2007 was 121,549,701. That would be less than a one percent increase in revenues.
In 2008 Tom Compton and most of the Board of Directors (with the single exception of Dick Wells) got modest raises over their 2007 salaries. Compton’s total financial compensation went from just over $744,000 in 2007 to just over $771,000 less than a half of one percent of what he was paid in 2007.
All of the members of the Board of Directors got about the same percentage of raise for 2008. Only Dick Wells took a hit as his total earnings dropped from $110,500 in 2007 to $104,500 in 2008.
This year’s tax return did have some information not published in previous tax returns and that is the base salary plus other benefits for all members of the board and the salaries of other management team members.
While looking over those pages, one salary really stunned me. Dan Olson Director of Fuel and Car operations had a base salary of $205,000 and with deferred payments his 2008 salary was over $240,000!
The other thing that really got my attention was that bonuses are a way of life if you work in the NHRA management. Tom Compton’s year-end bonus for 2008 was a quarter of a million dollars on a base salary of $460,000. In addition to Compton getting a bonus, so did all of the Board of Directors except Dick Wells and Dallas Gardner.
The sales staff naturally got large bonuses, which is pretty standard, but NHRA’s general counsel (lawyer), public relations head, and event managers were awarded bonuses of $40-50,000! In all, the management team of the NHRA took home salaries in excess of $2 million. Nice work if you can get it.
Despite the fact that most of the Board of Directors got raises as did many of the other key employees, the actual payroll for the officers, directors and key employees was about $50,000 less, probably because Wally Parks was no longer on the payroll.
There are some other salaries listed that caught my eye, including independent contractor announcer Bob Frey’s (not enough), a couple of additional lawyers (always too much) and the guy who parachutes the flag into every national event ($100,000+ which is not nearly enough for jumping out of a perfectly good airplane 24 times a year.)
Some expenses I noted just puzzled me. The NHRA spent 24 million dollars on advertising and promotion and within a couple of hundred dollars of the same amount on Prize money and Trophies. Does that mean that the NHRA averaged spending $1,000,000 to advertise and promote each of their 24 races in 2008? NHRA’s 2007 tax returns show just them spending just over $11,300,000 on advertising and promotion. Since the 2008 return is structured different from the 2007 perhaps some line items are now combined but if not that meant NHRA doubled their advertising budget from 2007 to 2008.
It’s hard be sure I’m reading it right, but it appears that the total cost to the NHRA for the TV broadcast remained at about $13,000,000 with a slight increase in 2008. The revenue from ticket sales was up a couple of million dollars, which was a good sign that Compton and his crew did their job in 2008, and they were rewarded for their efforts. That the way it is supposed to be, isn’t it?
In looking at these figures (and if you really want to read the whole thing anyone can get a copy of NHRA’s tax return since they are a not for profit corporation just by asking and paying a small fee), NHRA did well in 2008. We won’t get the 2009 numbers until this time next year but you can bet that the NHRA took a big financial hit. It will be interesting to read that when the time rolls around.In the meantime I’m sending in my membership renewal money again. The last few years we members sent NHRA over $4,000,000. I like to think I’m paying their salaries -- and that allows me to criticize them when I feel like it.