‘No playbook’: App State Athletics out roughly $1.5 million due to COVID-19
April 11, 2020
App State Athletics will navigate a difficult financial landscape due to COVID-19, one that involves the loss of roughly $1.5 million.
Each year the NCAA gives about 60% of its revenue back to Division 1 conferences and member institutions. The cancelation of spring sports due to COVID-19 means that figure is notably smaller this year.
On a Zoom conference call Thursday, App State Athletic Director Doug Gillin was blunt when it came to the financial future of App State Athletics.
“We’re working on all scenarios,” Gillin said. “I hate to put like a percentage on it in terms of ‘this is what athletics, from a budgeting standpoint, could become,’ and certainly our budgets will be lower moving forward.”
App State will receive a lower payout from the Sun Belt Conference this year because the conference decided to save money for next year.
In 2019, the total operating expenses for athletics was $37,773,447. The previous year, the operating expenses were similar, according to App State’s NCAA financial reports.
The $1.5 million loss is about 4% of App State Athletics’ total budget.
Gillin said athletics is not at the point of salary reduction yet, but has “considered all models.”
“We’re absolutely keeping our finger on the pulse of what’s going on around the country and we’re absolutely in unprecedented times for which there is no playbook,” Gillin said.
Other schools across the country have been preparing for the financial hardships. The University of Wyoming’s athletic director Tom Burman announced on Twitter he would reduce his salary by 10% until Dec. 31.
Iowa State announced a temporary pay reduction for coaches and certain staff, which will save the department more than $3 million. The school will also suspend bonuses for coaches for a year.
With the NCAA granting another year of eligibility to seniors playing spring sports, App State faces the other expense of seniors on scholarships coming back. Gillin said scholarships would be honored.
“Philosophically, we thought it was the right thing to do for student athletes and spring sports,” Gillin said. “And now we’re working with all of our coaches to see what our financial exposure with that will be based on who’s coming back.”
Gillin said about 50-75% of the student athletes who can come back and play another year will. He also said the total number of athletes coming back and the expense will be more definitive next week.
“I told our coaching staff the very first day, this is going to be painful. We’re all going to have to be in it together,” Gillin said.
Looking ahead to the start of the 2020-21 academic year also means football. And for universities across the country, football is one of the biggest money makers.
For App State, a best or worst case scenario hinges on football, which had a $7,241,789 operating budget in 2019.
“When you talk about worst case scenarios, you’re talking about not playing football in academic year 2021,” Gillin said. “Best case, we’re kicking off on Sept. 5 against Morgan State.”
Gillin said somewhere in the middle — an abbreviated season — could still work, but it would be “painful, but the pain is less.”
“I’m hopeful that we’ll be playing college football and all of our other fall sports sometime in academic 2021,” Gillin said.
Despite the struggles surrounding COVID-19, Gillin said he couldn’t be more proud of the way coaches, staff, university leadership and the community have reacted.
“I do believe that adversity brings opportunity. I do believe adversity reveals character,” Gillin said. “I couldn’t be more proud to be a member of the High Country community.”
Mu Chao • Apr 20, 2020 at 9:40 am
Here’s a thought:
How about the football coach takes a one-year pay cut. Pay him what a lecturer with a Masters degree earns: $40K a year to teach full-time at the university, with a year-by-year contract (i.e. zero job security!) That alone would free up ~33% of their lost income. If that’s too little for the coach then maybe he and the administration can explain how their faculty, you know the folks that actually provide the primary service for the university, are supposed to survive off it…
Hell, a one-year moratorium on Athletics would free up millions. If the university were simply to redirect the >$1,000/per student/per year that is spent on Athletics, and directed that towards university operations, not only would we make up for every penny that’s been lost due to COVID-19, we’d actually come out a couple million dollars ahead.
Until Athletics can prove that they are capable of breaking even WITHOUT millions in subsidies from students and taxpayers (majority of whom get *nothing* in return), they do not deserve a single penny in assistance.
Sandi N. • Apr 13, 2020 at 7:30 am
As you point out, the $1.5 million loss is a mere 4% of the total athletics budget. They are banned from traveling right now so they are likely saving that same amount they just lost.
Who does pay for the athletics budget? STUDENTS and TAXPAYERS! Student fees and taxpayer dollars compromise millions of dollars each year. Athletics does not bring in nearly as much as it spends. But thanks to the fees they charge the students they have plenty of money.
DJ Waldy • Apr 12, 2020 at 9:31 pm
Is the AD serious? They are saving much more than $1.5 million in the lack of travel, recruiting, practice and games. They are probably rolling in the cash with all the university and taxpayer subsidies they receive every year when they have very few expenses. The question is, when they are enjoying a highly paid vacation, why are they not reducing their budget to help the university out with a budget crisis? Academics and faculty are forced to take cuts while athletics, coaches and Doug Gillin receive fat paychecks and spend super scarce university funds on athletics pet projects. In the middle of a crisis, are they still spending $2.5 million to move dirt in the stadium to make it louder? What the heck is this campus thinking?