University of Iowa projects 'tens of millions' in athletics losses due to the pandemic
Athletic directors at the University of Iowa, Iowa State University and the University of Northern Iowa presented their fiscal year 2021 budgets to the Iowa Board of Regents for approval on Wednesday — and projected grim losses in revenue and severely tightened budgets as a result of the coronavirus pandemic.
"At Iowa, we were riding a great wave of momentum competitively and financially. We have been self-sustaining since 2007, and we were giving money back to the university," said Gary Barta, director of athletics at the University of Iowa, on Wednesday.
"On March 12, that all changed," Barta said, referencing the day when the Big Ten announced that all competitions until the end of the academic year would be cancelled, continuing a domino effect caused by the pandemic that put an indefinite hold on college athletics.
The Iowa Board of Regents delayed approving fiscal year 2021 athletic budgets until September due to ongoing scheduling changes caused by the uncertainty of the pandemic. Other university budgets were approved in July.
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University of Iowa
The University of Iowa is expecting "tens of millions" in losses due to the pandemic, Barta said Wednesday, which he projected could impact the athletics department for over a decade.
The exact figure is up in the air following the Sept. 16 announcement that Big Ten football games can resume, with significant restrictions, on Oct. 23 and 24.
"It will be tens of millions. Not 10, not 20, 30 — it will be, maybe, 40 to 60 million dollars. I know that's a wide range, and I'm doing that intentionally," Barta said.
Big Ten football games will bring back revenue for UI, but not nearly enough to cover overall losses.
Football games this fall will also take place without fans, meaning UI can't count on the more than $20 million in ticket sales it brings in during an average year. UI also generates another $15-20 million from "premium seating," through suites, club seats, and seat donations, which will be lost this year.
The Big Ten has also outlined sweeping medical protocols to accompany Big Ten play, including cardiac screening and daily antigen testing for coaches, trainers and student athletes. Safety protocols will add another expense to the athletic department budget, Barta said.
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This fall's monetary challenges only add to losses accumulated since the pandemic began taking a toll on college athletics last spring. To offset losses, the UI athletics department has cut four sports programs: men's gymnastics, men's tennis, and swimming and diving for men and women.
Barta said the resurgence of Big Ten football this fall will not bring in nearly enough revenue to bring back the four programs.
"Sept. 16 was good news if you're a football student athlete or coach. It was good news for those staff members that were still working here because it lifted the energy — knowing that we could play football. And it was certainly good news to Hawkeye fans who wanted to play," Barta said.
However, the news about Big Ten football didn't fix the problem.
"I had staff members whose positions were being eliminated contact us and ask if they'd be able to stay on. And we had to have that very challenging discussion and say 'No, I'm sorry, this hole is still very deep, and it's going to be impacting us for probably more than a decade as we pay back the deficit.'"
While recognizing the difficulty of the situation athletics departments have been asked to face since the pandemic began, regents still pressed Barta with questions about the decision to cut sports programs.
"Many of us on the Board of Regents are receiving a lot of emails and correspondence from alumni that feel like they maybe should have been involved more before the sports were dropped...In the process, would it have been appropriate to reach out to alumni, or not?" asked Regent Nancy Boettger.
Barta said that the financial challenges were so great that it was not feasible to raise the money needed to keep the programs. He consulted with athletic directors from around the country in making the difficult decision, he said.
Barta also said he did not want to create a false sense of hope that the programs could continue by opening up a dialogue about it.
University of Iowa president Bruce Harreld, addressing Boettger's question, said he and Barta have met with community members who are concerned about the programs being cut and answered their letters personally.
"I responded to one of them last night, saying 'Look, we're not going to put the university at risk,'" Harreld said.
UI has also promised to honor the scholarships of every student athlete in the four cut programs through graduation, should they decide to remain at Iowa.
"I have never had as many people talk to me about the use of being a regent and why we allowed this to happen in the almost six years I've been on," said Regent Patty Cownie. "I know it was probably a really difficult decision for you. But man, there's a lot of anger out there about it."
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Iowa State University
Jamie Pollard, director of athletics at Iowa State University, said his department's fiscal year 2021 budget is down to $78 million, compared to $90 million during an average year.
The athletic department's revenue is projected at around $43 million, putting the school at a $35 million deficit. That deficit is based on a projection, Pollard said, and could change as the year goes on.
ISU athletics underwent a 10% pay reduction, eliminated all bonuses, and took a 20% cut on all operating costs.
"The good news is that we don't feel we have a short term cash-flow problem," Pollard said. "We have the ability to be able to work our way through this."
In a worst-case scenario, if the school had to pay back the $35 million deficit over time, Pollard said the department feels comfortable being able to do so through additional cuts.
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University of Northern Iowa
The University of Northern Iowa's athletics budget has been reduced to $12.7 million from about $14.4 million. Losses in revenue tally up to about $2.7 million.
"There continues to be a lot of uncertainty about where things are going to land," said David Harris, director of athletics at UNI. "And while we are now getting more information about where things are going to be from a scheduling standpoint, there's still a chance that things won't come across... exactly like we planned. And in a year like this, that has a significant budget impact."
Losses in ticket sales are projected at about $800,000, a 47% decrease compared to ordinary circumstances, and losses from concessions are estimated at $160,000.
Harris pointed out that all of the numbers from Wednesday's presentation presented a snapshot of the budget "at one point in time."
"If you look at our ticket sales and our concessions, those things are contingent on having fans at our games, but also adhering to the governor's proclamation about six feet of distancing being necessary at those games," Harris said.
UNI has cut expenses, too, to keep up.
Athletics staff members above $41,000 in annual salaries took between a 5% and 12.5% one-year pay cut. The department also reduced operating budget costs by about $600,000 to save money, or a 34% percent decrease, among other budget costs.
UNI is also trying to make up the gap with added sources of revenue.
Last week, the school also announced the "UNI Fight Initiative" to raise funds for the department. So far, the campaign has raised about $400,000.
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