Gov. Jim Justice’s nonprofit that operates the Greenbrier Classic PGA Tour golf tournament is about $11.6 million in the hole as of 2016, tax documents show.
Despite its steady losses, Old White Charities has allocated an average of about 4 percent of its total spending to charity between 2010 and 2015.
In total, between 2010 and 2016, OWC has reported donating $4.9 million to various charities and has received $16.5 million itself in gifts and grants.
While The Greenbrier resort did not host a tournament in 2016 due to the deadly flood that killed roughly two dozen people, 2016’s heavy financial losses continued a pattern of hemorrhaging money since OWC first put on the event.
Nonprofits, specifically 501(c)(3) organizations, are required to file their tax returns annually with the Internal Revenue Service, which makes them publicly available. OWC’s 2016 report was recently filed with GuideStar, which curates information about charitable organizations. Older filings were accessed via ProPublica’s Nonprofit Explorer tool.
OWC is a tax-exempt entity, under section 501(c)(3) of the Internal Revenue Code.
“Old White Charities Inc. is organized exclusively for religious, charitable, scientific, literary, or educational purposes including the making of distributions to organizations that qualify as exempt under section 501(c)(3),” its mission statement reads. “Old White Charities Inc. intends to operate ‘The Greenbrier Classic’, a professional golf tournament and distribute the net proceeds to organizations that qualify under section 501(c)(3) of the Internal Revenue Code.”
The documents show OWC has only turned a profit in 2010 — in which its roughly $30.3 million in revenue yielded $82,000 in profit — and 2012. It took on heavy losses in 2011 ($5.4 million), 2013 ($2.5 million), 2015 ($3.1 million) and 2016 ($4.7 million).
While the first tournament brought in $30.2 million in revenue in 2010, that number declined to $19.6 million in 2011 on down to $10.7 million in 2015. However, OWC’s 2010 revenue numbers were buoyed up by a $1 million government grant and nearly $15 million in grants, contributions and gifts from other parties.
Elmer Coppoolse, chief operating officer of The Greenbrier resort, said the losses are the result of a lack of sponsorship for the tournament.
“It means we need more sponsors,” he said. “Every year, there’s a big effort in place to attract more sponsors. Hopefully that will start to happen.”
He said if those new sponsorships roll in, the tournament will be able to donate more money. However, he praised Justice and his family for reaching into their own pockets to both eat the losses on the tournament and continue to donate hundreds of thousands to charity each year.
“For right now, we are trying to attract sponsorships so that as much money as possible can go to charities,” he said. He added that the tournament makes certain charitable moves that are not reported, such as selling tickets to other charities at half price, which then sell them at full price.
The organization’s 2017 filing is not yet available. However, Coppoolse said the tournament brought in about $5 million in revenue and spent about $9 million putting on the tournament. He also noted that the resort only re-opened the golf course two days before the 2017 tournament, after repairing the damage incurred during the flood.
During three tax years, OWC reported intermittent spikes in travel spending. In 2012, OWC spent $2.7 million on travel, more than three times what it donated to charity that year. In 2011, it spent $1.9 million on travel, just less than three times what it donated that year. In 2014, it spent $1.4 million on travel, compared to the $806,351 it donated.
Coppoolse, who began working as chief operating officer in 2016, said 2017’s travel expenses were slashed to about $10,000. He said in the past, Jim Justice has — “maybe to a fault” — gone out of his way to bring in celebrities for media days and musicians for concerts, but he did so for the sake of the tournament.
“There are all kinds of circumstances where Jim goes out of his way to make it easy for people to get here,” he said.
Country music stars Keith Urban, The Band Perry, Miranda Lambert and Blake Shelton played at the tournament in 2015.
Looking at the big picture, Coppoolse said Justice has taken repeated personal financial hits to create and retain a PGA Tour tournament in West Virginia — a major boon for the state. He said the national exposure the tournament yields for West Virginia is invaluable, and builds a more positive brand for the state.
“When you just look at the numbers, it doesn’t tell the whole story,” he said. “The national TV exposure is huge on this, and it’s all positive.”
The Charleston Daily Mail reported in 2015 the economic benefits spill over outside The Greenbrier and into surrounding businesses in Lewisburg as well.
The filings also show OWC owes millions to The Greenbrier resort, along with some of Justice’s coal and agriculture companies.
In 2016, OWC reported it owed “Greenbrier Hotel” $4.58 million, Justice Farms $350,000, and “JCJ II” $1.4 million. The charity also reported $6.3 million from Southern Coal — a Justice company — as an asset, as well as $225,000 from Bluestone Resources, another Justice company.
In 2015, OWC reported owing Kentucky Fuel more than $3 million and owing “GHC” $10.3 million. It also reported as assets $6.3 million from Southern Coal and $1.7 million from “JCJ.”
Coppoolse said he had no idea why the charity took on those assets and liabilities.
Laura Neal, the senior vice president of communications for the PGA Tour, declined to comment for this report, citing Tour policy of not commenting on the financials of host organizations.
Justice purchased The Greenbrier resort in 2009.
Along with cash flow problems, OWC has also racked up a bill of legal fees stemming from lawsuits alleging it failed to pay its contractors for work.
In March, OWC and Greenbrier Hotel Corporation signed a consent judgment order approving a settlement requiring them to pay $667,000, plus interest, for allegedly failing to repay Special Event Services Rental for borrowed equipment that was damaged on the day of the June 2016 flood.
That was two days after the two entities signed another consent judgment order approving another settlement requiring them to pay out $820,000 plus interest to Select Event Group Inc.
These came on top of a summary judgment from a federal judge upholding a circuit court decision requiring OWC, not its insurer, to pay out about $192,000 as the result of a hole-in-one challenge it put on for the tournament. However, a related suit between OWC and Bankers Insurance is ongoing.
On the two consent judgments, Coppoolse said they are the result of a delayed insurance reimbursement.
“We are waiting for an insurance settlement, and that’s the reason why we have to enter into these arrangements, because we have advanced money to restore The Greenbrier, and it hasn’t been reimbursed to us yet by the insurance companies, and we are waiting for the moment to come where they will finally square up with us,” he said. “When that happens, all these things will be repaid and that’s the understanding we have with these companies.”
He declined to comment on the ongoing litigation in the hole-in-one suits.
Despite the legal and fiscal woes of the charity, Coppoolse said The Greenbrier resort itself is in good financial health.
“We of course are dealing with the monies that we need to get back from the insurance company, which puts a real stress on our cash flow, but we are otherwise financially healthy,” he said. “If we could just get that money squared up with them, then we would be in perfect shape. But of course that has a huge impact right now on what we are able to do cash-flow wise.”