PGA Tour Commish Monahan’s Comp Soars as Legal Fees Jump 10x

PGA Tour Inc.’s legal expenses jumped more than 10 times from 2021 to 2022—from $2 million to $20.7 million—according to its most recent tax return. This is a small glimpse into the mounting cost of the group’s protracted legal battle with Saudi-backed upstart LIV Golf.

The nonprofit’s IRS filings, which were obtained by Sportico, offer new insight into the financial health of the PGA Tour as it began its legal battles with LIV Golf. The fiscal year spans the 2022 calendar year, so the numbers all pre-date the June 2023 announcement that the PGA Tour, main European tour and LIV would try to merge their commercial assets. That agreed framework halted the legal fights, but talks are still ongoing on a final agreement and a potential second round of litigation lurks in the shadows.

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The $20.7 million in legal expenditures include only the first five months of the PGA Tour’s main fight with its Saudi-backed rival—LIV golfers sued the PGA Tour in August 2022, and the Tour countersued shortly after. It also includes costs related the Department of Justice’s review of the agreement. The figure is more than the nonprofit reported in legal fees in the previous 14 years combined ($20.2 million). By comparison, the NCAA, another nonprofit sports entity besieged by legal challenges, reported $52.9 million in legal fees in 2022, as it was defending itself against multiple antitrust lawsuits.

The legal costs were a large part of what drew the PGA Tour to agree to the three-way merger. Two days after the announcement, commissioner Jay Monahan told employees that the Tour had spent $50 million in its legal fight, and needed to tap into its $100 million in reserves.

“We cannot compete with a foreign government with unlimited money,” Monahan told staff, according to The Wall Street Journal. “This was the time… We waited to be in the strongest possible position to get this deal in place.”

Monahan’s overall compensation in 2022 was reported as $18.6 million, up from $13.9 million in the 2021 document. The commissioner’s 2022 haul includes a $1.8 million base salary, $9.2 million in bonus and incentive compensation, and an actuarial estimate of $7.4 million for non-cash benefits that he will receive after he retires, according to the Tour.

Overall, the PGA Tour reported $1.9 billion in revenue in 2022, up from $1.59 billion the previous year, thanks to new multibillion-dollar TV deals. Expenses rose as well, with the organization reporting $1.87 billion in costs, up from $1.55 billion in 2021.

Sovereign wealth’s increased interest in global sports has been one of the biggest stories of the past few years, with the financial tolerance of many of those funds playing a central role in disrupting sports like soccer and golf. PIF, the Saudi sovereign fund behind LIV, reported roughly $600 billion in assets under management last year. That’s 30 times the annual revenue of the NFL, the world’s richest sports league, and significantly higher than the net worth of every NFL owner combined.

The PGA Tour's tax returns also details more than $5 million in severance payments to former employees. They include $2.1 million to former CFO Kenneth Sharkey, $1.5 million to former executive vice president Jeanne Lightcap and $1.1 to former CMO Ty Votaw.

The PGA Tour is one of the last major American pro sports organizations still operating as a federal nonprofit. That status drew additional scrutiny in the wake of the proposed agreement with LIV, with a bill proposed in Congress to end corporate tax exemptions for pro sports. Rep. John Garamendi (D-Calif.), who introduced the bill in June, told Sportico that the legislation was motivated by Saudi Arabia’s human rights abuses. However, the bill has yet to even be voted on in the House Committee on Ways and Means.

Michael McCann contributed to this report.

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