Four members of Congress have written to IRS Commissioner Doug Shulman asking him to investigate potential tax irregularities by three tax-exempt groups that run college football bowl championships.

The letter came on the heels of a legal complaint filed by Playoff PAC, a group that opposes the Bowl Championship Series, against the Arizona Sports Foundation, also known as the Fiesta Bowl; Orange Bowl Committee Inc.; and Sugar Bowl (see Groups File IRS Complaint Against Bowl Game).

Reps. Joe Barton, R-Texas, Gene Green, D-Texas, Jason Chaffetz, R-Utah, and Cynthia Lummis, R-Wyo., wrote to Shulman referring to Playoff PAC’s report on the BCS organizations.

“This report was released to the general public, and we understand that the report offers documentation of possible Internal Revenue Code violations related to unreasonably high compensation, ‘private inurement,’ unpaid tax for ‘excess benefit transactions,’ undisclosed lobbying expenditures, political intervention, and spending on questionable items,” they wrote.

The complaint alleges that Sugar Bowl’s top three execs received $1,225,136 in fiscal 2009 on revenue of $12.7 million, meaning that just three people took almost $1 of every $10 the bowl earned. Fiesta Bowl CEO John Junker received $317,717 in the fiscal year ending 2009 for working just 21 hours per week from the Arizona Sports Foundation, that bowl’s lead entity. Junker’s total compensation package from all Fiesta Bowl-related entities was $592,418 for FYE 2009, nearly quadruple the CEO pay at similar-sized charities.

The Fiesta Bowl gave two bowl executives $240,000 in unsecured interest-free loans, reportedly to pay for their personal memberships in a private golf club, according to the complaint. Sugar Bowl executive director Paul Hoolahan received $645,386 in FYE 2009, a year in which the Sugar Bowl lost money despite receiving a $1.4 million government grant. Hoolahan collected $25,000 more than the Rose Bowl’s top three executives combined.

BCS Bowls use charitable funds to fly bowl execs and spouses first-class, pay private club dues, and foot the bill for employees’ personal income taxes. The Orange Bowl, for example, spent $756,546 on travel in FYE 2009 for its employees, according to the complaint.

The lawmakers urged the IRS to review the report and scrutinize the three BCS Bows’ records to ascertain whether any violations occurred.

“We believe it is important for these BCS Bowls to be fully transparent and compliant with the law,” they wrote. “As public charities that take in millions of dollars each year, they receive significant tax exemptions and benefits that must not be abused.”

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access