National Governing Bodies: A TFAA Reader Weighs In

This perspective comes from George Perry of Atlas Coaching and Performance – Thanks George!

Last week I went to the UPS Store to send my spring textbooks back to Amazon.  I gave myself an extra 15 minutes or so because we were running a subject that morning and I didn’t want to be late.  After 90 seconds at UPS and a 2-minute ride across campus, my schedule cushion quickly became white space.  In the extra time I realized my error: I had based everything on going to the Post Office instead of UPS, and the latter’s efficiency surprised me with an extra 10 minutes of downtime.

Having lived in my fair share of zip codes, I’ve come to accept that a trip to the post office will likely end with me walking out, muttering obscenities and asking, “How is this place still in business?”  Easy – by law, the Postal Service is protected from competition.  A series of laws going back to 1872 prohibit any private company from delivering first-class mail (letters) or delivering anything to a mailbox: what are known as the “letter monopoly” and the “mailbox monopoly.”  Better yet, the Postal Service itself interprets the extent of these monopolies, and therefore, how much they will permit competition at the edges of their domain.  FedEx and UPS have been “allowed” to carry packages and documents, but are still forbidden from delivering magazines and birthday cards to your mailbox.

Every 2 years, another monopoly – one that oversees a family of monopolies – grabs our attention for 2 weeks: the US Olympic Committee and its constituent national governing bodies (NGBs).  Much like the Postal Service, the USOC is a “federally chartered corporation” that wields “exclusive jurisdiction… over all matters pertaining to US participation in the Olympic Games.”  The USOC may even one-up the Postal Service, as the USOC enjoys, by law, “perpetual existence.”  The Olympics and Amateur Sports Act of 1978 also authorizes the USOC’s monopolistic progeny, the national governing bodies.  The USOC can “[recognize] only one NGB for each sport,” and each NGB has the exclusive power over the conduct and composition of that sport for international competition.  Any disputes within an NGB, including an attempt to replace an NGB, are referred either to the NGB itself, or to the sole appellate jurisdiction of the USOC.

For all we hear about monopolies in the news and in high school history class, the US has had very few true monopolies.  A careful review of my pocket Constitution turned up no uses of the words “sports,” “athletes” or “athletics.”  You may be thinking, “Come on, G, the government doesn’t subsidize the athletes, they don’t regulate apparel companies or training gyms, so where’s the party foul?  Is this really worth your libertarian time?”

Put yourself in the athlete’s position: if you have an issue with your NGB and cannot resolve it internally, your only recourse is to go to the NGB’s parent NGB.  The process and the results are every bit as incestuous as you might imagine.  You can’t take your business or your talents elsewhere, because by law there is no “elsewhere.”  Any attempt to work outside or around the system will be stymied because, again by law, the only proscribed remedies are through the internal mechanisms.  And if you’re not in a professional sports league, the people you’re confronting and challenging are the same ones you rely on for permission to earn your paycheck.  You might as well try to get a postal employee fired for gross incompetence.  Good luck.

One of the biggest stories of the last year in American pro track and field has been the battle between the athletes and the USATF over the rights to wear sponsorship logos during competition.  This confrontation has energized creative efforts by athletes to find funding, has generated discussion and grass-roots activity across all levels of the sport, and has exposed the true workings, nature and motives of the national governing bodies.  Over the next few weeks, we’ll be producing a series of essays on the role of national governing bodies in professional and Olympic sports; the collusion between national and international governing bodies; how the sponsorship / logo issue demonstrates the pitfalls and inevitable consequences of the current NGB system; and what the future of American track and field might look like.

The sponsorship logo issue has brought the role of national governing bodies (NGBs) to the forefront of discussion in track and field, along with sometimes undesirable attention to the sport from news, business and sports outlets.  The battles between athletes and NGB over something as seemingly simple as an endorsement on a uniform represent much of the dysfunction in American track and field, and do little to reverse the sports’ waning popularity as a professional spectator sport.  Since all Olympic sports operate under the same NGB framework, two important questions are why did this conflict arise solely in track and field, and could it happen elsewhere?

While the Olympic and Amateur Sports Act (OASA) confers a monopoly on each NGB, the NGBs have considerable latitude regarding their structure and governance.  The OASA mandates the NGBs oversee US Olympic participation in their respective sports, and promote the development of their sports across the US.  Hockey and tennis are two Olympic sports that consistently outrank track and field in spectator popularity and professional athlete income, and have very different governance models within the OASA framework.  Comparing these three sports provides a snapshot of different ways sports implement the NGB model, and how the NGBs interact with co-existing professional leagues, the athletes and the sports’ community.

Hockey

Living under the shadow of (and formed over 60 years after) the National Hockey League, USA Hockey maintains low visibility within the hockey community.  While most local hockey clubs affiliate with USAH, numerous semi-pro and development leagues exist without USAH’s sanction or sponsorship.  USAH’s website links to the NHL’s website, but neither the NHL nor many minor leagues link to USAH.  The NHL Players Association (NHLPA), which is independent of both the NHL and the NGBs, negotiates on the players’ behalf, certifies sports agents and ensures all parties’ compliance with the collective bargaining agreement.

Tennis

Tennis may bear the most resemblance to track and field since it is an individual sport with several national and international circuits.  The US Tennis Association presents development circuit and professional tour events, including the US Open Series culminating in the US Open; and partners with the professional World Team Tennis league.  American professional tennis players compete outside the United States in events organized by the Association of Tennis Professionals (men) or Women’s Tennis Association, both of which are independent of the USTA and tennis’s global sporting organization, the International Tennis Federation.  The USTA continues to serve as the players’ association after some players’ unsuccessful attempts to form an independent body.

Track and Field

The USATF is involved at nearly every track and field event in the US, with involvement ranging from course certification, event and club sanctioning, up to event execution.  The USATF presents the US’s only professional track and field and road racing circuits, the Visa Championship Series and the USA Running Circuit.  The US hosts two events each year as part of the Diamond League series, an international professional circuit organized by the global sports organization, the IAAF.  Professional track and field athletes are primarily represented individually through their agents, although the Track and Field Athletes Association is actively expanding its size and stature within the US professional athletics’ organization.

The most important contrast between these sports is the dispersion of responsibility for governance, competition, athlete development and representation.  From the time he leaves his parents’ home to make his way through the development leagues right up through an NHL career, a pro hockey player may never interact with his NGB unless he is selected for a national team.  Any conflicts he may have as a professional will be addressed via his agent and the NHLPA.  Hockey demonstrates how a professional league, albeit one with vast resources and institutional history predating the NGB-era, can exist completely autonomously of an NGB, yet still support the NGB’s primary mission in Olympic and world championship tournaments.

Similarly, a tennis player may be developed by the USTA before graduating to the WTA circuit (although still as a member of and represented by the USTA).  While she lacks an independent players association, her ability to make an honest living as a professional athlete is preserved by the existence of professional circuits outside of the NGB and her retained right to secure – and display – corporate sponsorship.  The independent contractor model for an individual-athlete sport is compatible with national governing bodies and a thriving professional circuit.

Conversely, at both the national and international levels track and field’s governing bodies exercise vertical and horizontal monopolies over the sport.  A track athlete exists under the USATF umbrella nearly every step of the way.  Their only “respite” comes during their college years when they are governed by the NCAA, an organization whose broken governance has repeatedly attained national attention.  When professional track athletes seek relief or redress, the USATF is both their adversary and their legally authorized and solely recognized advocate.  All parties sit on the same side of the table – the USATF’s side, because athletes ultimately have to maintain good standing within the very organization they are confronting.

Track and field athletes lack three structures that appear necessary to ensure their professional well-being: an adversarial resolution process involving a recognized, independent players’ association; an independent professional league; and the legally guaranteed possibility of establishing an alternative governing or competitive organization.  Hockey and tennis show these three structures do not need to be mutually independent of each other, while track and field shows the consequences of them all existing within the same body.  Unfortunately, the Olympic and Amateur Sports Act precludes the possibility of an alternative governing body, while cementing many of the restrictions and institutional norms of the amateur era in track and field.  The lack of a single independent professional league precludes the possibility of multiple upstart semi-pro or development leagues.  Trapped between the law and the USATF’s institutional inertia, players lack both the voice and the exit option necessary to ensure good organizational governance.

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photo credit:  Cayusa

About Tim Huntley

Tim is the former CEO of Ganymede Software. He spends his time advising high tech start-ups, serving on the board for the Track and Field Athletes Association, and writing on his blog, An Entrepreneurial Life.

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