MONEY & BUSINESS
GAME OVER? LAWMAKER TAKES FRESH AIM AT NFL’S NONPROFIT STATUS
BY ERNIE SMITH / FEB 3, 2015
NFL Commissioner Roger Goodell, shown testifying on anti-doping measures in 2009. (Brendan Hoffman/Getty Images)
Newly minted House Oversight and Government Reform Committee Chairman Jason Chaffetz wants NFL Commissioner Roger Goodell to explain why the league should continue to be treated as a nonprofit by the Internal Revenue Service. The question comes at a time when the league is already burdened with high-profile scandals.
Just because the biggest congressional critic of the National Football League’s nonprofit status has retired, that doesn’t mean that the issue is dead.
In fact, just-departed Sen. Tom Coburn (R-OK) may have simply passed the ball to the other chamber. And Rep. Jason Chaffetz (R-UT) is aiming for the goal line.
In one of his first moves as chairman of the House Oversight Committee, Chaffetz has pledged to take a fresh look at the rules that allow the NFL and the National Hockey League to be treated as 501(c)(6) nonprofits under federal law, despite the fact that the leagues generate billions of dollars in revenue each year.
Speaking to CNN on Monday after the Super Bowl, Chaffetz said he wants NFL Commissioner Roger Goodell to testify on the issue in front of Congress.
“Was that a nonprofit event going on or was that a for-profit venture? It’s a for-profit venture,” Chaffetz said. “You tell people that the NFL is a nonprofit entity and they just start laughing and giggling. But it’s not fair. If there’s another side to that, then let the commissioner come in and make that case.”
The NFL notes that it pays taxes on revenue-generating activities, like ticket sales and television rights, and that only the league office is tax-exempt.
Chaffetz picks up where Coburn left off. In 2013, the former senator proposed legislation called the PRO Sports Act, which would have required sports leagues earning more than $10 million per year to pay taxes on their revenue. The bill died in the Senate, with no further action taken. (Taking on the NFL isn’t always popular. Bloomberg Business called Coburn’s bill “A Republican Senator’s Lonely Mission to Make the NFL Pay Taxes.”)
Rep. Jason Chaffetz says he’s not focused on the NFL’s scandals, just its nonprofit status. (photo by Michael Jolley/Flickr)Rep. Jason Chaffetz says he’s not focused on the NFL’s scandals, just its nonprofit status. (photo by Michael Jolley/Flickr)
SEASON OF SCANDALS
Chaffetz’s push comes at a time when the NFL is dealing with a number of scandals. Among them: the fumbled handling of a domestic violence incident involving former Baltimore Ravens star Ray Rice; questions regarding whether the league is doing enough to deal with player concussions; criticism of the league’s drug policy; and an ongoing murder trial involving Aaron Hernandez, a former player for the current Super Bowl champs, the New England Patriots. (Speaking of the Pats, there’s also Deflategate.)
Based on who’s talking, many fans believe these scandals have Goodell in danger of losing his job.
But Chaffetz says his goal is not to put the league on trial for its handling of those controversies. “The NFL is going to have to sort that out,” Chaffetz told CNN. “And the fans are going to have to push them that direction. That spotlight is pretty bright on them right now. I don’t know that we would add additional light to that.”
