There’s no denying it: College sports programs at all division levels are hemorrhaging dollars right now.
With budget and potential program cuts on the horizon, peel back the financial statements of many athletic programs and there are several ways they could go about addressing the budget shortfalls COVID-19 has presented.
On March 26, the NCAA announced an amended budget approved by its Board of Governors to cut its annual distribution to Division I conferences to $225 million. That’s just 37.5 percent of its typical $600 million budget that was set to be distributed to those institutions at the end of the 2019-20 academic year.
“Some are genuinely trying to balance their budgets, and then others will use the moment to downsize to engage in a strategic decision,” said Ellen Staurowsky, Drexel University’s athletic administration program director.
“This also provides an opportunity to think critically and rationally about where money is coming from and where it is going.”
The University of Louisville was the first program to publicly acknowledge its financial hardship after cutting 40 positions in its athletic department and furloughing an additional 45 people. Old Dominion University has also dropped its wrestling program due to losses in revenue during this time.
Next month, we’ll have a clearer picture on the depth of financial hardship permeating across all NCAA colleges and universities when schools will send their annual athletic budgets to their board of trustees for approval.
Looking at the University of Oregon’s athletic expenses for 2018, the school only profited off of two of its 17 varsity sports — football and men’s basketball. The remaining 15 sports in its athletic department don’t rake in a profi. For 2019-20, 36 percent of its expenses were allocated toward coaches salaries, 37 percent to operations, and 11 percent went to scholarships. There is a possibility that coaches and athletic directors — similar to NBA players — will take a pay reduction of some sort. All of Oregon’s athletic programs generated revenue during 2018, and that year, the university received $1,961,462 from the NCAA distribution.
“The big thing is if you have a sport that is a revenue generator or has the opportunity to be a revenue generator and in some cases profit, that would be a sport you’d like to keep,” Tony Weaver, a former Athletic Director at University of North Carolina at Greensboro and chair of the Department of Sport Management, at Elon University said.
“Tradition and history obviously affects athletic departments’ decisions as well.”
Weaver says he envisions many schools’ decisions will come down to four factors: the success of the program, how easily it is for their school to recruit for the program, if the program has had a progression of success, and if the program has an established competition structure in the NCAA.
“All of this becomes personal,” Weaver said. “You never want a student athlete’s career to end this way. Athletic directors don’t wake up thinking, ‘I’m going to save money and cut a program, and that way, our teams, our coaches, don’t get to participate anymore.’ That’s not what you want to do.”
Oregon, for example, spent $997,019 in 2018 on solely football recruiting and $286,799 on men’s basketball — both of which are nationally ranked programs. Because of COVID-19, they likely aren’t using a dime of that money with no traveling. Another piece to this puzzle is factoring in the debt that many athletic departments already have on their hands. For some schools, even though they have profit-generating sports, they still might find themselves in the hole at the end of the year, and that is without a pandemic.
For example, Clemson University’s athletic department had a $1,883,002 profit in 2019 while Oregon’s athletic department netted a $13,550,435 debt in 2018.
Some programs like the University of Delaware men’s basketball, and University Notre Dame women’s basketball have placed a self-imposed hiatus on recruiting during this pandemic, which means they’re no expenses right now. Many schools turning to Zoom and Facetime calls to connect with recruits will benefit from the elimination of that expense.
When things are back up and running, it’s plausible that what typically was deemed an insignificant budget turns into a new normal for athletic programs if they present comparable results to post COVID-19.
Another piece to this puzzle will be student enrollment for the fall. Division II schools rely on student tuition more than Division I schools.
Brandon Davis, San Francisco State’s Associate Director of Athletics, says they expect student enrollment to be down, adding that they have already found ways to cut out what is “luxury,” including additional out of conference games, travel expenses, etc. He is also looking at what can “be put off for another year.” He says they don’t expect to cut any programs.
With every school facing some financial burden due to this pandemic, it’s pretty clear we will be looking at a completely different college sports landscape when this is all said and done.