UW could pursue a loan to help offset lost revenue
MADISON – Led by the Big Ten and Pacific 12, athletic departments across the country are studying ways to offset the potential loss of millions of dollars in revenue in the wake of most college football games being postponed until at least the second semester of 2020-21.
The options include: reducing salaries, cutting sports and securing loans.
Pacific 12 members were the first schools known to pursue loans.
According to the Mercury News, the
Pacific 12 plans to offer a maximum of $83 million to each league member at a rate of 3.75% over 10 years.
Iowa is the first known Big Ten school to pursue a loan. Athletic director Gary Barta told reporters Monday the school is pursing a loan of about $75 million. Barta recently announced the school is cutting men's and women's swimming and diving, men's tennis and men's gymnastics.
Wisconsin athletic director Barry Alvarez is adamant UW officials have not discussed cutting sports despite the potential loss of $100 million in revenue without football this fall.
However, a Big Ten source said Tuesday that UW is open to the possibility of securing a loan to help offset the losses.
A UW spokesperson said Tuesday he was not able to discuss the matter.
UW announced in May the athletic department's 25 highest-paid employees would take voluntary pay cuts of 15% for six months. Alvarez has said UW could utilize its reserve fund. That stood at $190 million at the end off the 2018-19 fiscal year.
Big Ten officials are working on plans to stage a modified season that could begin as early as January.
Broadcast revenue from staging a modified season, plus tapping into the reserve fund plus securing a loan could help UW offset much of the projected lost revenue.
According to UW's latest financial report to the NCAA:
The football program produced about 58% of the department's $157.7 million in revenue in 2018-19.
Football generated $45.6 million from media rights, $24 million in ticket sales, $9.4 million from bowl distributions, $8.3 million from contributions related to the program and $5.3 million from program sales, parking fees and concession sales.