Yurachek: Deficit to close fiscal year
The University of Arkansas stands to lose potentially millions of dollars related to athletic event cancellations prompted by the coronavirus, Athletic Director Hunter Yurachek told UA System trustees Wednesday.
At the same time, the university plans to refund its season-ticket holders for the spring sports events have been cancelled, a cost of $1.75 million.
Yurachek won’t know for a few weeks just how much revenue will be lost from diminished SEC distributions, he said, but right now schools are looking at losing $2 million to $3 million each.
Prior to cancellations, Yurachek expected about $45 million from the SEC.
The university will break even on refunds and possible repayment of sponsorships when factoring in less money
spent traveling and conducting other activities, Yurachek said. But it will have a deficit overall because of the loss of SEC funds.
“So we’re looking at deficit as we close out this fiscal year,” Yurachek said. “It would be hard not to have a deficit.”
College athletic conferences across the nation — although not all — have canceled spring sporting events to prevent the spread of the coronavirus. The NCAA canceled its men’s and women’s basketball tournaments — a blow to fans, schools, cities and businesses that make money off of them.
Still, financial challenges may be exacerbated at the system’s smaller universities’ athletic departments, System President Donald Bobbitt said. Several people audibly agreed.
UA’s athletic department is the only one, in the system or statewide, that operates on enough revenue to not need student fees as a supplement.
Yet, Yurachek isn’t certain how the school will go about accounting for an added year of NCAA eligibility for spring athletes in terms of its scholarships. He said he thinks the NCAA likely will allow schools to offer more scholarships, but that doesn’t solve the problem.
“What the NCAA won’t provide is the funding for those scholarships,” Yurachek said.
The university offers scholarship renewals in the summer.
“I think it would be a challenge to pull those scholarships back for anyone other than our incoming freshmen now,” Yurachek said.
Board Chairman John Goodson said trustees plan to meet remotely with more frequency to discuss the financial strain on system schools and programs caused by public health measures taken to curb the coronavirus spread. He asked Yurachek if he knew yet what his revenue and expenditures may look like for the upcoming academic year.
Yurachek said he can’t forecast that now.
He noted that certain revenues are related to events from years prior.
March Madness, for example, pays out about $810 million to NCAA member schools but is five years in arrears. So what the NCAA will be able to pay out for basketball revenue is unclear, he said.