“I am overwhelmed by the magnitude of this change,” Hirshland wrote. “It is significant.”
The USOPC had employed around 500 people, and Hirshland said this month the USOPC was working on an “expense reduction plan” that would be unveiled by June 1. In her memo Thursday, she said “the revenue we projected to collect this year, and in future years, would decline.”
“As a result of that, we decided to proactively reduce our expenses by 10-20% over the 2020-2024 time frame to ensure we will be able to deliver against our mission and serve Team USA athletes for years to come,” she wrote.
The USOPC was expecting a windfall of nearly $200 million this summer, its share of U.S. media rights that NBC pays to the International Olympic Committee. That money will not arrive until the conclusion of the Tokyo Games, which have been postponed to 2021. The coronavirus pandemic also is affecting agreements with corporate sponsors, a key revenue stream.
“It has become clear that it will take months, and not weeks, for us to return to full operation,” Hirshland wrote, “particularly at our training centers in Colorado Springs and Lake Placid. We are adapting, even more than we had imagined, to a new way of operating and we cannot predict how long it will take before we have clarity on what the future holds.”
The memo does not specify which positions were eliminated, but Hirshland indicated the cuts were strategic, aimed at minimizing the impact on athletes preparing for Olympic competition.
The postponed Tokyo Games and economic downturn rocked the Olympic movement in the United States. With events postponed or canceled throughout the spring and summer, revenue streams dried up. Most of the national governing bodies received federal payroll loans but are still projecting to lose millions of dollars during the crisis. Max Cobb, head of the USOPC’s National Governing Bodies Council, told The Washington Post this month that lost revenue could reach $100 million.
The Colorado Springs-based USOPC is expected to have a virtual town hall Tuesday to discuss how it will move forward with a significantly smaller staff.
“At the end of a difficult day, and a tough month, we must all be asking ourselves if something that feels so awful is necessary and right,” Hirshland wrote to her staff. “I believe that these actions are the right ones. All of this will make the difference. Because it isn’t one thing that will determine our success. It is the right combination of mission, values, strategic focus, discipline, talent, and fiscal responsibility and efficiency that will define our success.”