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Senator suggests possible end of USOC’s tax-exempt status

October 4, 2018

A senator floated the idea of revoking the U.S. Olympic Committee’s tax-exempt status if it fails to effectively combat the sex-abuse problem in Olympic sports.

At a hearing Wednesday, Sen. Richard Blumenthal, D-Connecticut, said the USOC’s tax-exempt status and antitrust exemption could be at risk when Congress revisits the law that governs the federation.

Blumenthal also suggested the position of athlete advocate and inspector general be added to the USOC. The federation has an athletes’ ombudsman position and recently revealed plans to give athletes more-accessible avenues to report abuse and other wrongdoing.

Leaders of four Olympic sports federations — figure skating, bobsled, weightlifting and swimming — appeared in front of a Senate subcommittee in the latest in a series of hearings to discuss their response to the sex-abuse crisis.

Blumenthal suggested Congress would make revisions in the Ted Stevens Olympic and Amateur Sports Act to “make sure the USOC is held to a higher standard of accountability.”

The USOC does not receive government funding and is a nonprofit, which makes it exempt from taxes. Judges also have ruled that the Ted Stevens Act has given the USOC antitrust immunity. Revoking the USOC’s tax-exempt status could potentially take a huge chunk out of an operation that brought in $336 million during the last Olympic year (2016) and uses much of that to provide assistance to athletes, either directly or through sports federations that train them.

As part of her first address to the U.S. Olympic family, new USOC CEO Sarah Hirshland said last month that athletes needed to be better represented in the decision-making process in Olympic sports.

Blumenthal grasped on that idea and asked the sports leaders if they’d be willing to increase athlete representation on boards and committees to 50 percent or more; the general standard is about 20 percent. But he was met with resistance.

“It comes down to the competence of the board,” said USA Bobsled and Skeleton CEO Darrin Steele. “A competing athlete is looking at four-year increments, and it’s difficult to think about long-term strategy when you’re actually in midst of the competition.”

US Figure Skating president Anne Cammett agreed.

“Part of what you have to look at is the learning and life experiences that come with developing from a young person to an adult,” she said. “I think you need a good balance of life experience and knowledge.”

Cammett piggybacked on Blumenthal’s calls for change, saying the U.S. Center for SafeSport, established to investigate abuse cases in Olympic sports, needs more funding and would also benefit from subpoena power to conduct its investigations.

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