UPDATE: This post has been updated with responses to inquiries from a PGA Tour spokesperson.
The PGA Tour paid $284 million in compensation to its more than 1300 employees in 2023, a 30 percent rise from 2022, and $103 million, or a 57 percent boost from 2021. The higher number is included in the Tour’s 2023 tax return, or Form 990, which the pro golf association filed last month and sent a copy to Awful Announcing at our request.
Commissioner Jay Monahan is listed in the tax return as earning $23 million, up from $18.6 million in 2022 and $14 million in 2021, according to a review of those years’ Tour tax returns. But these figures are inflated by IRS reporting requirements, a Tour spokesman wrote and the more accurate figure for 2023 is $14.1 million.
“As reflected above, in accordance with the disclosure requirements to Form 990, the 2023 Form 990 includes both compensation earned and received by Commissioner Monahan in 2023 ($14,136,393) and also includes estimates of amounts earned and deferred to future years by Commissioner Monahan in 2023 ($9,156,952),” the spokesman wrote. “Included in the deferred compensation is an actuarial estimate related to his post-retirement benefits ($2,476,952) that he is not entitled to receive until he retires, along with long-term incentive compensation ($6,680,00) that he is eligible to receive in future years. These two amounts ($9,156,952) were not cash compensation received by the Commissioner.”
In other words, the IRS requires the Tour to include as compensation money that will be paid out in the future.
The accelerated pay was largely due to upper echelon PGA Tour staff, with payouts to officers, directors, trustees, and key employees rising 77 percent to $116.4 million, according to the form 990s for 2023 and 2022.
According to a PGA Tour spokesperson, much of the pay increase was due to the increased purses on tour since PGA Tour players also double as directors. “The increase is primarily because Player Director earnings paid by PGA TOUR, Inc. for tournament winnings, events and other programs are required to be reported on the Form 990, which increased ~$43 million year over year, representing ~80% of the increase. It is important to note that PGA TOUR, Inc. directors, including Player Directors, are not compensated for performing board service, other than reimbursement of documented expenses to attend board meetings. The increase is also the result of increases in employee headcount and related benefits and payroll tax expenses related to those employees required to be reported.”
The pay rise in 2023 came amid a stormy and tumultuous year for the PGA Tour, one which saw a brutal legal battle with the LIV Golf tour, and then, as it turned out, a premature partnership announcement with the Saudi-backed rebel tour. Criticism rained down on the PGA Tour after that announcement, in part the trigger for Monahan to take unscheduled time off for medical leave.
Another landmark occurrence happened in 2023 – the PGA Tour lost money, at least according to the tax return. The Tour took in $1.828 billion in revenues, $62 million less than expenses. Going back to 2015, the Tour had reported an eight figure surplus each year. In 2022 for example, the figure was $32 million.
On the losses in 2023, the spokesperson cited a lack of Presidents Cup revenue, increased purse sizes, and the ongoing legal issues with LIV Golf. “The overall loss is a result of decreased revenues associated with 2023 being a non Presidents cup year, and certain non-recurring payments for rights and royalties, as well as increases in player compensation, and other player benefits paid by PGA TOUR, Inc. The investment write-off was the result of a restructure of corporate subsidiaries of PGA TOUR, Inc. which were inter-company in nature and did not impact free cash flow generated by the business.”
“There were outside legal costs incurred during 2023 related to ongoing PIF discussions as well as costs incurred related to the standing up of PGA TOUR Enterprises.”
The Tour is clearly in no financial peril; hardly. It has net assets of $1.2 billion, and in January sold for $3 billion part of a new commercial and licensing arm to a group of wealthy investors.
Revenue in 2023 fell to $1.83 billion from $1.9 billion. Player payouts rose more than $50 million, and as noted above, compensation costs for Tour employees rose.
