During the morning hearing on the 91 House Bill on the Senate Finance Committee, the fact that the North Carolina High School Athletic Association received a loan under the 2020 Payroll Protection Program was raised as a matter of concern.
Sen Thom McInnis (R-Richmond), who was one of the lawmakers investigating the NCHSAA, said the PPP loan was worrying.
“They took out a PPP loan with $ 40 million in the bank and I was shocked again when I realized what they were thinking because we had a lot of citizens and a lot of small businesses in this state who could not get a PPP loan because the money ran out.” McInnis said.
It was previously reported that NCHSAA received a $ 176,200 PPP loan in April 2020, shortly after the PPP loans became available. It was used to maintain 19 jobs at the NCHSAA during the pandemic.
WRAL has confirmed that McInnis’ Iron Horse Auction Company, Inc. has also received a PPP loan. The Rockingham-based company received a $ 172,600 loan and was also forgiven. The loan was used to support 11 jobs at the enterprise.
NCHSAA Commissioner Ku Tucker said in previous interviews that NCHSAA took out a loan to prevent layoffs and layoffs. The NCHSAA sport was closed in March 2020 due to the pandemic and did not resume until November 2020, which meant that NCHSAA had no revenue streams. The regulations prohibit NCHSAA from using other funds, such as a donation fund, to pay staff salaries.
The NCHSAA also said the $ 40 million figure is roughly equal to its total assets. The association does not have $ 40 million in cash to spend.
Based on its most recent audited financial position since June 2020, there is a total of $ 15.8 million in limited donation funds that are open-ended, with donors indicating how they can be spent. This money cannot be spent or distributed.
The $ 10.7 million is the money shown by the board of directors, which was funded through a $ 1 surcharge for playoff games, 25% of game donation revenue, and interest earned on fixed assets. Playoff and donation ticket surcharges have been suspended indefinitely. It’s also a fund that raised $ 4 million for pandemic relief for selected schools.
NCHSAA holds $ 13.9 million in non-earmarked funds. This includes two years of operating reserves, investments, and things like an office building, equipment, and vehicles.
The Senate Finance Committee gave HB 91 a positive recommendation Thursday morning. The bill will now be referred to the Senate Rules and Operations Committee.
Most state associations received PPP funds
In a previous interviewDr Karissa Niehoff, executive director of the National Federation of Public High School Associations, said nearly all state associations across the country received money in the form of PPP loans.
“In a case like the one we just experienced, we had a pandemic – or is still closing down – many of our state associations without healthy standby accounts are really in trouble,” she said. “Without a PPP program, they may not open their doors next fall. So we want to see 501 (c) (3) with healthy reserves, with a healthy fund strategy. “
HighSchoolOT found public records that 44 out of 51 state associations received PPP loans. Several government associations have received multiple loans, including for specific regions within their associations.
The California Federation of Interschools and its regions received 13 loans totaling $ 2,177,060 – more than any other state association. The Minnesota High School League came next with $ 1,690,120 in PPP funds, followed by the Ohio High School Athletic Association at $ 1,149,575.
40 out of 51 state associations received more PPP funds than the NCHSAA. The NFHS also received two PPP loans totaling US $ 1,480,000.
Travis Fine, a reporter for WRAL State House, contributed to this report.