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April 14, 2017

Where Do Dollars to the NRA Go?

by Anne Paddock

The NRA – National Rifle Association of America – is a 501 (c)(4) which differs from a 501 (c)(3) in four ways:  the organization can engage in unlimited lobbying as long as the lobbying pertains to their mission, participate in political activity, endorse or oppose political candidates, and donate money and/or time to political organizations.

Contributions made to a 501 (c)(4) are not tax-deductible which means the NRA relies primarily on other sources for income: member dues, program fees, other contributions and grants, royalties, related organizations, investment income, sale of assets, advertising, subscriptions, and other sources.

In 2015, the NRA reported total revenue of $337 million, which came from the following sources:

  • Member Dues and Program Fees:  $180 million  (53% of total revenue)
  • Contributions, Grants, and Related Organizations:  $95 million (28% of total revenue)
  • Advertising:  $25 million  (8% of total revenue)
  • Royalties and Subscriptions:  $20 million  (6% of total revenue)
  • Sales of Inventory:  $14 million  (4% of total revenue)
  • Other Sources:  $3 million  (1% of total revenue)

Reported expenses were $300 million (excluding non-cash depreciation expenses) which is 89% of total revenue, are summarized as follows:

  • Additional Membership Expenses (no detail provided):  $68 million (20% of total revenue)
  • Compensation, Benefits, Pensions for 842 employees:  $54 million  (16% of total revenue)
  • Compensation, Benefits, Pensions for 10 key executives: $10 million (3% of total revenue)
  • Advertising:  $36 million  (11% of total revenue)
  • Printing, Publications, and Fulfillment Expenses:  $35 million (11% of total revenue)
  • Additional Training and Community Service Expenses:  $33 million  (10% of total revenue)
  • Office, IT, Insurance, Occupancy, Etc:  $21 million  (6% of total revenue)
  • Other Expenses (Unexplained), Interest:  $17 million (5% of total revenue)
  • Travel and Conferences:  $15 million (4% of total revenue)
  • Fees for Services (Legal, Accounting, Lobbying, Fundraising):  $11 million  (3% of total revenue)

Important points to consider:

The most highly compensated ten staff were men who were paid more than $10 million, with the highest compensation package ($5.1 million) provided to Wayne LePierre, the CEO. Chris Cox was provided a total compensation package of $1.5 million. The remaining 8 executives received compensation between $313,074 – $633,948.

101 employees received more than $100,000 of reportable compensation.

The NRA spent more than $15 million on travel and conferences. In the disclosures, the NRA reports they use first class or charter travel and pay for health or social club dues or initiation fees.

The five highest compensated independent contractors were:

  • InfoCision (Membership Processing):  $20 million
  • Ackerman McQueen (Public Relations and Advertising):  $14 million
  • Postmaster (Postage Shipping):  $10 million
  • Communications Corp of America (Fundraising Printing, Mailing):  $9 million
  • Valtim Inc. (Fulfillment Center):  $8 million

The NRA used 2 paid solicitors for fundraising:  Allegiance of Fairfax, VA who collected $24.5 million and was compensated $480,000; and InfoCision who collected $9.2 million and was paid $4.5 million leaving $4.7 million to the NRA. The fees paid to InfoCision equate to 50% of what they collect which is high.

The annual membership fee in 2015 was $35 (although some members paid less or more, depending on when they joined and the duration of their membership) was spent as follows:

 $35.00:  Membership 

-$ 7.00:  Membership Expenses

-$ 6.65:  Compensation and Benefits for Employees and Executives

-$ 3.85: Advertising

-$3.85: Printing, Publications, and Fulfillment

-$3.50: Additional Training and Community Service Expenses

-$2.10: Office, occupancy, IT, insurance, etc.

-$1.75:  Other Expenses (unexplained), Interest

-$1.40:  Travel and Conferences

-$1.05:  Fees for Services (Legal, Accounting, Lobbying, Fundraising)

-$31.15  Total Expenses

$ 3.85:  Amount Remaining (placed in fund balance)

The NRA reported total assets of $215 million, most of which were in cash and securities ($86 million), land, buildings and equipment ($39 million), accounts receivable ($64 million), and inventory ($11 million).

Liabilities totaled $139 million and primarily consisted of accounts payable and accrued expenses ($79 million), secured mortgages ($29 million), and deferred revenue ($27 million).

The net result is that the NRA has $75 million in net fund assets which was an increase of $33 million over the previous year (due to spending only $300 million of the $337 million the organization collected).

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