Another deficit
Nuñez: Virus is big reason for expected $3.5M shortfall
More red ink for UNM Athletics’ budget; coronavirus’ impact is a big reason
The financial bite the world’s COVID-19 pandemic will take out of Lobo athletics appears to be significant.
In fact, University of New Mexico athletic director Eddie Nuñez on Friday confirmed the total deficit for Lobo athletics by the end of fiscal year 2020 (ending on June 30) is projected to be about $3.5 million on what is roughly a $32 million budget.
Both Nuñez and documents reviewed by the Journal that will be part of a presentation at Tuesday’s UNM Board of Regents Finance and Facilities meeting indicate the department is attributing about $3.2 million of that shortfall directly to the pandemic.
UNM is projecting a $1.2 million shortfall in “NCAA/Mountain West Conference” revenue sharing distribution — something the Journal reported in late March when the NCAA announced, as a result of cancelling its men’s basketball tournament, that it was cutting its annual distribution to its 350 Division I members by roughly 62.5%.
UNM is also projecting a $1.97 million shortfall on its budgeted line item of “Special Events,” which had been called on to bring in north of $3.5 million this fiscal year. That includes significant shortfalls from the following cancellations or alterations of events due to COVID-19:
■ The NMAA’s state high school boys and girls basketball championships (fans were not allowed into Dreamstyle Arena - the Pit the final three days and UNM gets significant revenue streams from parking, concessions and a percentage of ticket sales);
■ No PBR rodeo event this spring in the Pit;
■ No parking revenue for Albuquerque Isotopes baseball or New Mexico United soccer;
■ No facility rental or parking and concession revenue from the annual state high school track & field, state softball and baseball championships played at UNM.
“They’re a big revenue and funding opportunity source for us, for sure,” Nuñez said of the canceled high school tournaments. “But we
also realize these events are their primary money makers. This really hurt them — we realize that — and we’re all in this together trying to work through this.”
DONATIONS: UNM says having to cancel an annual spring Lobo Club fundraising gala and golf tournament that have been major contributions in recent years will also hurt the budget. MULTIMEDIA RIGHTS/SPONSORSHIPS/LICENSING: UNM last year shifted its partnership from Learfield, which would have guaranteed between $2 million and $2.5 million, to OUTFRONT, which gives UNM far less guaranteed money, but the opportunity to make a higher percentage of sponsorship sales throughout the year.
Nuñez has defended the decision, while acknowledging this year that line item could come up short in part because a late start on the deal and the loss of sponsorship opportunities in the spring. Final numbers there aren’t yet in, though they aren’t expected to exceed a shortfall of $500,000 on what was a $4 million budget projection.
TRAVEL: While there isn’t as much travel for the spring due to the canceling of spring sports, most travel packages were already paid for by UNM, according to Nuñez. He said much of the travel costs will be credited for future use, but not recouped for this fiscal year.
TICKET SALES: UNM is expecting around a $150,000 shortfall in ticket revenue projections. While men’s basketball still is bringing in an estimated $3.5 million in ticket revenue (football brought in about $950,000 and women’s basketball under $400,000), the second half of the season tale-spin for Lobo men’s hoops did contribute to what projects to be about $100,000 shortfall of projections.
FURLOUGHS? Nuñez said that while he’s looking at everything to tackle the department’s budget concerns, salary cuts or furloughs would likely need to be an “institutional level decision” and not just within his department.
SUSTAINABLE? Last August, UNM announced at a Regents meeting that athletics technically made its 2019 fiscal budget, but that was with the aid of unbudgeted main campus or land sale transfers of roughly $1.8 million.
Friday, Nuñez said the department was on a good path toward financial stability this year before mid-March.
“We were moving in that direction,” he said.
But he also said, and has before as did his predecessor Paul Krebs, the current model of college athletics is likely “unsustainable” at UNM if there aren’t significant changes to university or state support for the program compared to Mountain West Conference peers.