Skip to content

August 10, 2020

6

Where Does $100 to NPR Go?

by Anne Paddock

NPR (National Public Radio) – the radio station that people love to love – is a non-profit, tax-exempt 501 (c) (3) organization that works with its member stations to foster a more informed public by providing a deeper understanding of events, ideas, and cultures.

Based out of Washington, DC, NPR is also noteworthy for its on air fundraising although most people would be surprised to learn that public support in the form of contributions, gifts, and grants is not the number one source of revenue. Instead, program service revenue (station programming fees, digital media sponsorships, membership dues from member stations, distribution, and digital services) is the primary source of revenue for NPR followed by contributions, gifts, and grants.

10 key things to know about NPR include:

  1. NPR is headquartered in Washington, DC.
  2. Of the 24 directors listed on the Form 990 (2017 for the year ending September 30, 2018), 16 (67%) are male while 8 (33%) are female. NPR’s website reports there are 23 directors (in accordance with the by-laws), 17 (74%) of whom are male while 6 (26%) are female.
  3. NPR has 1,283 employees (as of 2018). 492 received more than $100,000 in compensation.
  4. NPR raised $252 million in 2018; $29 million more or a 13% increase over 2017. $142 million (56%) came from program service revenue while $97 million (38%) came from contributions, gifts, and grants.
  5. NPR also has a foundation called the NPR Foundation , a separate non-profit, tax-exempt 501 (c) (3) that raised $22 million in 2018 and gave NPR nearly $17 million. The foundation operates out of the same address as NPR.
  6. For the past two years, NPR has spent less than the organization raised which is in contrast to previous years when the organization consistently spent more than they raised resulting in the net fund balance decreasing from a high of $175 million in 2012 to a low of $124 million in 2016 before reversing course.
  7. NPR has total assets of $358 million, concentrated in real estate  ($210 million) -mostly land and buildings – and cash and securities ($92 million). Liabilities total $225 million, $171 million of which are tax-exempt bond liabilities.
  8. At year-end (September 30, 2018) had $133 million in net fund balances (note:  the NPR Foundation has about $350 million of net assets).
  9. NPR also provides news and information services outside of the US – primarily in East Asia and the Pacific and the Middle East and North Africa.
  10. NPR did not pay for first class or charter travel, companion travel, personal services, health of social club dues or initiation fees, a residence for personal use or housing allowance, discretionary spending accounts, gross up payments or tax indemnification.

So, if you made a donation of $100, how were these dollars spent? To answer that question, we have to look at expenses. In 2018, NPR reported total expenses of $234 million (not including $10 million in depreciation), which is 93% of revenue. These expenses were categorized as follows:

  • $144 million (57% of revenue):  Compensation
  • $ 22 million (10% of revenue):  Office-Related Expenses
  • $ 22 million (10% of revenue):  Content Acquisition
  • $ 14 million (5% of revenue):  Corporate Sponsorship
  • $ 10 million (4% of revenue):  Fees for Services (primarily other, no detail provided)
  • $  8 million (3% of revenue):  Travel and Conferences
  • $  6 million (2% of revenue):  Interest
  • $  5 million (2% of revenue):  Other Expenses (primarily other with no detail provided, lease and fees)

As illustrated above, the largest expense for NPR is compensation for the 1,283 employees who received $144 million. The average compensation was $112,000. However, only 492 employees (38%) received more than $100,000 in compensation. The most highly compensated employee was the President and CEO, Jarl Mohn who received $665,935.

Using the above information, every $100 in revenue was spent as follows:

$100:  Revenue

-$ 57:  Compensation

-$ 10:  Office-Related Expenses

-$ 10:  Content Acquisition

-$  5:  Corporate Sponsorship

-$  4:  Fees for Services

-$  3:  Travel and Conferences

-$  2:  Interest

-$  2:  Other Expenses

-$ 93: Total Expenses

 $  7: Revenue Remaining:  To Fund Assets

As illustrated above, by far the largest expense for NPR is compensation for the 1,283 employees.  $57 out of every $100 in revenue was spent on compensating employees.  Office expenses, fees for services, travel and conferences, and other expenses use up $19 more.  Content acquisition, corporate sponsorship, and interest use up $17 of every $100.  And, finally $7 out of every $100 was added to the fund balance.

To read the IRS Form 990 (2017 for the year ending September 30, 2018) for NPR, click here.

To read the IRS Form 990 (2017 for the year ending September 30, 2018) for the NPR Foundation, click here.

6 Comments Post a comment
  1. Aug 11 2020

    Yes, I noted in my post a brief discussion of the foundation (see “5.”) and included a link to the foundation Form 990 at the end of my post. I will add a sentence on the foundation assets. Thank you.

    I typically focus on the organization that is the public face (although I often mention an affiliated foundation that may provide funding or hold significant assets) in trying to keep the post as short and to the point as possible. My goal is to help readers who may not have an accounting background or who don’t want to read a 990 understand how donations are spent. Thanks for your comments.

  2. Richard Rampell
    Aug 11 2020

    I believe that it may have been a matching gift. Paul Haaga also did the same. Also, if you follow up on this, you should look at the NPR Foundation 990 as well. NPR’s 990 lists the Foundation’s assets on Schedule D attached to the 990. I just finished reviewing a draft of the 990 to be filed on the 15th of this month and the Foundation assets add about another $300 million. About 2/3 of this amount came from a bequest from Joan Kroc, widow of the founder of McDonalds. The Foundation files a separate 990. Once the tax return is approved by the board members and filed with the IRS, NPR will post both on their website.

  3. Aug 11 2020

    By the way, what were the parameters of the $10 million donation? Was the donation pledged over several years from him personally or through the Mohn Family Foundation or did he write a check for the full amount this past year?

  4. Richard Rampell
    Aug 11 2020

    Understood. Just wanted to add some background not reported on the 990

  5. Aug 11 2020

    I report what the most recent Form 990 reports, which was submitted by NPR to the IRS.

  6. Richard Rampell
    Aug 10 2020

    I am a trustee of the NPR Foundation. Although you report the recently retired CEO, Jarl Mohn’s compensation $666K, what you don’t know is that he recently made a donation of $10 million to NPR. Also, the prior CEO, Paul Haaga, served for 14 months at $1year in salary.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Note: HTML is allowed. Your email address will never be published.

Subscribe to comments

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: