The National Rifle Association of America shrank significantly through the first eight months of 2021, according to detailed financial records obtained by The Reload.
The contraction came in membership, revenue, and program services across the organization. The group’s income missed the mark against its own budget projections and against what it brought in over the same period in 2020. At the same time, spending on legal services exceeded both. Legal fees ballooned more than $6.5 million from 2020 to a total of $31.1 million or about 20 percent of the group’s expenses.
The amount spent on lawyers was more than ten times the amount the NRA spent on programs aimed at education and training, competitive shooting, law enforcement, community engagement, the NRA Range, NRA Firearms Museum, and school security combined. Legal fees were the second largest expense for the organization behind costs associated with getting and keeping members.
The gun-rights group’s membership fell to its lowest point since 2017. Its revenue dropped to $165.2 million—missing its own projections by $19.4 million. That brings revenue to nearly half what it was in 2018, thanks mostly to a drop in membership dues. Spending is down even further: In 2018, the group spent more than it brought in, but it has paid down $14 million of its debt and run a slight surplus through August 2021.
“They’ve cut back those expenses to the point where it’s sustainable but they’re a much smaller organization,” Brian Mittendorf, a professor of accounting at The Ohio State University who has followed the NRA’s financials for years, told The Reload after reviewing the numbers. “Their budget is sustainable, but at what point do members see a huge chunk of the money is going towards legal costs and the primary programs have really been gutted?”
Amy Hunter, director of NRA Media Relations, said the report showed the organization is in a favorable financial position and maintains its influential position in national politics.
“The subject matter here is an outdated, unaudited financial report,” she told The Reload. “Naturally, the NRA is not inclined to discuss non-public business strategies with those outside the organization. In any event, the NRA report is, as objective observers agree, very positive. We sank an ATF nominee who was adverse to the Second Amendment. We are winning many battles to elect pro-Second Amendment lawmakers. We are driving the passage of constitutional carry – the gold standard of self-defense. And we are confronting a New York Attorney General who openly vowed to destroy our organization. With respect to legal fees, we are defending the interests of our members against people who portray them as terrorists and criminals. The NYAG called the NRA a ‘terrorist organization’ and a ‘criminal enterprise’ before she was even elected – without a shred of evidence to support her claims.”
She said many of the struggles faced by the NRA in recent years have been the result of the pandemic.
“With respect to questions comparing figures from a pre-pandemic 2018 to 2020 (figures during a worldwide pandemic), the NRA, like many others, continues to confront this global pandemic that forced the cancellation of many events and impacted revenue streams,” Hunter said. “The safety and well-being of our staff and members is paramount. Through it all, the NRA has emerged stronger – better positioned to fight for its members and their freedoms. The Association and its patriotic members deserve an enormous amount of credit.”
The numbers are laid out in the most detailed financial accounting of the leading gun group ever made public. The NRA’s August 2021 financial statement package, prepared by NRA treasurer and chief financial officer Sonya Rowling for the NRA Finance Committee, was created on September 14, 2021. It provides deep insight into the internal operations of the NRA’s 501(c)(4) and limited insight into its affiliated non-profits, including the NRA Foundation and Political Victory Fund PAC, that make up the overall organization. The document was provided exclusively to The Reload by a source and was verified by a separate source with knowledge of the group’s finances.
While a slew of internal NRA documents showing the personal information of many staffers was stolen and distributed online by ransomware hackers last year, this document was not part of that hack. It contains no personal information of NRA staff or members.
The contraction of the organization through the first eight months of 2021 accelerates a trend that dates back to 2019 when news first broke of allegations CEO Wayne LaPierre and other leaders had used the nonprofit’s coffers to fund lavish personal trips and luxury wardrobes. While election cycles generally create ups and downs in revenue and spending for political groups, the NRA has seen consistent declines in revenue and membership since these corruption allegations landed in the news, leading to a suit from New York Attorney General Letitia James (D.). The declines also reflect the coronavirus pandemic’s sizeable impact, the high cost of its failed bankruptcy maneuver, and how multiple legal fights with former contractors or donors have drained the NRA’s funds.
The shrinkage threatens the NRA’s position as the most influential gun group in the country, even though it still remains the largest by any standard. The NRA’s struggle has often been a selling point for gun-control groups hoping to capitalize on Democratic control of the federal government. It has also led smaller gun-rights groups to inch in on the NRA’s lobbying efforts and siphon off major industry donors.
However, the group’s membership decline has not yet led to significant increases in support for gun control or movement on federal legislation, which has stalled despite aggressive support from President Joe Biden. The group also remains highly relevant in Congress and at statehouses across the country, as evidenced by its efforts to enact permitless carry paying off in five states last year. LaPierre even appeared alongside Texas Governor Greg Abbott (R.) as he signed the Lone Star State’s permitless-carry bill.
Additionally, the group’s political arm actually brought in and spent more money in the first eight months of 2021 than it did in 2020. The NRA Institute for Legislative Action (ILA) saw revenue climb by $1.9 million to nearly $25 million. ILA’s spending on special programs grew by $4.2 million to $20 million. Publications also rebounded with a $750,000 increase in revenue and nearly a million dollars in expense cuts.
Mittendorf said the fact that the drop-off across the organization wasn’t worse is a sign NRA members are willing to give the organization latitude to solve its problems.
“Though member revenues have dropped, the revenue base has thus far remained surprisingly robust,” he said. “Given the controversies and admitted financial issues, one may expect more drastic revenue drops than have been seen. This suggests the loyal membership base creates an opportunity for the organization to stop the bleeding and restore both revenues and core programs.”
However, he said a turnaround needs to come quickly if the NRA wants to avoid even more severe problems.
“The organization’s approach to its finances does reverse the deficits it had accumulated post-2016,” Mittendorf said. “Yet, the alarms for long-term success remain: Drastic declines in spending on core operations create the potential for a revenue ‘death spiral’ in which cuts in core programs scare off members, which in turn necessitates further cuts, and a downward cycle of this sort can be hard to reverse.”
UPDATE 2-3-2022 11:30 AM EST: This story has been updated to include comments from the NRA.
